With the watchdog cracking down on social media influencers, what are the rules on sponsored content?

When people first began to make money from having a large social media following, there were no rules and regulators had to play catch up

Caitlin Morrison
Thursday 16 August 2018 17:10
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Spend a small amount of time on Instagram, and you’ll soon come across a sponsored post. How will you know it’s sponsored? The celebrity or social media star doing the posting will have flagged it as such, using some sort of variation on #spon, #ad or #collab.

Spend a bit more time on Instagram, and you’ll probably come across a post that isn’t flagged up as an advert, but certainly could be. Sometimes this is because a lot of what you see on social media can seem a bit like spin at the best of times; sometimes it’s because people are not playing by the rules.

That’s why the competition watchdog has decided to wade in. On Thursday, the Competition and Markets Authority (CMA) announced out of the blue that it was launching an investigation “into concerns that social media stars are not properly declaring when they have been paid, or otherwise rewarded, to endorse goods or services”.

The CMA said influencers and celebrities are required under consumer protection law to let their followers know when they’ve been paid to promote, review or talk about a product, and if they’re found to be breaking the law, it will take action.

Beckii Flint is a vlogger with more than 125,000 subscribers on her YouTube channel, and has been posting videos online for “much longer than anyone has been making money out of it”.

When she heard about the CMA’s plans for an investigation of the industry, she says, it sounded “a little bit intimidating”.

Overall, Flint says, the planned probe is a good thing because there are some "creators" (another term for influencers) who “don’t put any effort into disclosing ads”.

However, she adds, it’s not always easy for influencers to be sure they’re following the rules.

When people first began to make money from having a large social media following, there were no rules; regulators had to play catch-up. These days, influencers are supposed to adhere to competition rules and the Advertising Standards Authority (ASA)’s code.

“It’s not ‘rules for vloggers’, it’s the rules for non-broadcasters,” Flint explains.

“You do have to sit down with it and take time to educate yourself, it’s not just one page, it’s pretty hefty. And some parts are difficult to understand.”

In fact, Flint adds, it can be difficult to even find the rules in the first place. She only learned that there influencers were supposed to follow specific regulations when someone else slipped up.

“I was first aware of it when that big campaign – I think it was for Oreos – was in the news, a lot of people got in trouble for that.”

It was indeed an Oreos campaign that first put the spotlight on influencers’ duty to disclose. In 2014, the ASA called out a group of vloggers who took part in an advertising campaign dressed up as a "lick race challenge". None of the videos indicated that there was a commercial relationship between the participants and Mondelez, the owner of the Oreos brand.

The vloggers involved barely got a rap on the knuckles in the end, but the Oreos case is notable as a rare occasion when the watchdog actually publicly censured an influencer for failing to flag an advertisement.

It’s easy to understand why, says James Erskine, director at Social Circle, an influencer marketing platform which manages relationships between brands and “creators”.

“The CMA and ASA haven’t got the bandwidth to look at every post across all social media,” he says. “It’s not easy to police the internet.”

In addition, there’s no real rhyme or reason as to how these posts are policed. Sometimes the regulators will flag a piece of content, sometimes a consumer will, but a lot of the time it relies on influencers policing themselves.

Grey areas like this proliferate across the influencer marketing landscape. For instance, if an Instagram star is paid to promote a visit to Thorpe Park, they should make that clear in their post. However, if the star refers to that visit in subsequent posts but doesn’t include #ad in the captions, are they breaking the rules? At the moment, it’s not clear.

And it’s about to get even more complicated, Erskine says: “You have different platforms experimenting with different ways of disclosing, you have collaborators experimenting.

“There’s no standardised way of showing a paid partnership exists, but there should be.”

Recently, Instagram began offering the option to post something specifically as a paid partnership, which makes clear the commercial relationship and the brand involved.

However, the ASA has not confirmed whether or not that would make a post compliant.

Meanwhile, Erskine adds, there are added difficulties because “different territories will have different rules”.

This is a big problem. Among US influencers, there is a sense that it’s easier to get away with bending the rules, because there is just too much content for anyone to monitor what’s going on. But US influencers aren’t just selling in the States. While regulation may stop at the border, influence certainly doesn’t.

There is a need for “clear, transparent regulation”, Erskine says, and Flint agrees.

“We need one rule,” she says. “At the moment, I don’t think it’s easy to follow, it’s not particularly clear.”

She feels strongly about the issue because, she admits: “When I was younger, I was really impressionable.

“It took me years to realise that if a vlogger has a coupon code then they are probably in partnership with the brand. And it’s important for kids – it’s important for everybody – to know when they are being advertised to.”

It’s not just the followers who will benefit from more clarity on the rights and wrongs of #spon, though.

“As a consumer you see a lot of posts where it’s ambiguous and it’s frustrating and creates distrust,” Flint says.

“You’re risking the audience’s trust for a paycheck, but by doing so you risk losing your audience - which is your career.”

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