Under the Influence: New Guidelines for Social Media Advertising
In this month’s LEGAL.FYI column, Lynne Moss, senior associate at Burness Paull, discusses the growing trend of social media ‘influencing’ and how new regulations require greater transparency.
Love it or loathe it, social media is here to stay. Recent years have seen the rapid rise of social media ‘influencers’ on platforms like Facebook and Instagram, and brands and advertisers have tapped into that trend and are using social media as a powerful marketing tool.
As consumers become weary of the more ‘traditional’ forms of advertising; such as television, radio and even websites, which can be skipped through, brands have had to come up with innovative and more immediate ways to advertise their products.
What is happening?
Social media celebrities and influencers and often sent products, either as gifts with no obligation to post them on their channels or under an arrangement to post certain information about the products in exchange for payment.
The attraction for brands of using influencers is that such promotion tends to look more organic, and it is not as obvious that there is active marketing taking place. However, without clear information that an influencer is being paid to advertise a product, or that there is otherwise some form of business or professional relationship, a consumer might purchase a product because they believe the influencer has paid for it themselves and liked it – unaware that they have, in fact, been paid to promote it.
What is being done about it?
Amid concerns that all of this could affect the mental health and wellbeing – as well as the financial stability – of consumers, the Advertising Standards Authority (ASA) and the Committee of Advertising Practice (CAP), along with the Competition and Markets Authority (CMA) have stepped in.
New guidelines to help influencers and brands understand what they need to do to be more upfront with consumers have been published, but there appears to be confusion about what is required and there is still inconsistency about how ads are being declared.
The ASA and CMA have recently published an Influencer’s Guide, but this also makes it clear that it is as much the brand’s responsibility to ensure that its products are advertised in accordance with the rules. The CMA also announced last week, following an investigation, that it had ordered a number of celebrities and other influencers to label their ads more clearly.
Is this, along with a new guide for social media endorsements, a sign that the CMA is about to get tougher on brands and influencers who break the rules online?
How should an ad be labelled?
Brands who advertise their products in the UK must follow rules set down in the advertising codes (CAP Codes), along with general consumer protection law which is enforced by the CMA. Advertisements must not mislead, harm or offend consumers, and must follow consumer laws.
For influencers, the main points to note are:
- You should make it clear when you have been paid to advertise a product – this includes payment of money as well as gifts and loans of products
- You should say when you have been gifted a product, rather than paid for a product yourself
- You should be clear about any current or past partnership (anything within the last year) with a brand, and
- You should avoid misleading consumers by saying that you are just a consumer yourself, or you have used the service or product if you haven’t.
What should brands be doing?
If you have any form of relationship with an influencer, you have a responsibility to ensure that ads are labelled as such and are not misleading. A consumer looking at an advert should be able to quickly identify it as such, without having to read the whole content, and it should be clear if an influencer has a commercial relationship with you.
Brands should consider doing the following:
- Ensuring your marketing team are familiar with the new guidance
- Having in place clear contracts with influencers which spell out what should be posted and how
- Make sure that the influencer only makes claims about the product which can be backed up, and that the content of an ad follows the rules about advertising certain types of products (such as age-restricted products, foods or supplements)
- Regularly reviewing and auditing the behaviour of any influencers you engage, and have procedures in place to put things right if they are not following the rules.
The ASA and CMA have been promoting the new guidelines on its own social media channels, and appear to be taking regulation of this advertising medium seriously. With the potential for hefty fines and, in some cases, even criminal sanctions, can you afford to be getting it wrong?