Vying for the attention of consumers, brands are increasingly turning to social media, and in particular, influencers, to reach their target audiences and promote their products in a seemingly genuine way. However, influencer marketing poses a number of challenges, both for consumers trying to distinguish between editorial content and advertising appearing side by side on social media platforms, and for influencers, who have seen their activities become increasingly subject to advertising regulation.
The key laws and regulations applicable to influencer marketing are set out in the Consumer Protection from Unfair Trading Regulations (2008) and the UK Code of Non-broadcast Advertising and Direct Promotional Marketing (CAP Code). The main aim of these regulations and rules is to ensure that influencers correctly label promotional content and sponsored social media posts in a transparent manner.
The UK’s Advertising Standards Agency (ASA) and Competition and Markets Authority (CMA) already published guidance on compliance for influencers in September 2018, January 2019, and September 2019 setting out what constitutes an ‘influencer’ or a ‘payment’ to such an influencer. The guidance also sought to explain that influencers should be clear about their relationship with the brands that sponsor them to avoid giving the impression that they are ‘just a consumer’. The requirement for clear labelling of promotional posts by using #ad, #advert, #prom or similar signposting was also introduced.
Are the new ASA and CMA guidelines a helpful clarification to address influencer concerns?
After consulting with influencers and agencies, the ASA and CMA recently published a condensed version of their guide to disclosure of advertising content. While the new guidance does not include any significant updates or clarifications, the presentation of the content is much more user-friendly thanks to the use of infographics to clarify key grey areas for influencers.
This is a step in the right direction for the regulation of the influencer industry and social media marketing. However, a key criticism of the current framework is the fact that the lengthy notes and guidance on the subject, emanating from two separate regulatory bodies, are confusing for influencers, who do not have the same compliance capabilities as large companies.
This push for clarification from the regulators has been accompanied by social media platforms themselves, who have devised tools to promote transparency and disclosure of brand-sponsored content, such as the ‘paid partnership’ tag on Instagram. Self-regulation has also come in the form of partnerships with the regulators, such as ITV’s partnership with the ASA in creating an ‘advertising survival kit’ for ITV’s Love Island contestants to ensure they are correctly following regulations when posting ad content on social media.
Despite these collaborative steps, influencers are still falling foul of regulators with ex-Love Island contestant Molly Mae Hague one of the latest influencers to have a complaint upheld against her by the ASA. In this case, the ASA ruled that future posts must include tags such as #ad to more clearly signpost partnerships.
While the sector is slowly evolving, there is still cause for concern that the rules are not clear enough. The ASA and CMA have still not provided clarity on the use of specific tools available to influencers on platforms such as the ‘paid partnership’ tag feature on Instagram. This is causing confusion amongst influencers, who may mistake platform disclosure methods as effective regulatory compliance tools without further including the #ad or #advert signposting.
“Make it clear…there really isn’t much more to it than that…”
In addition to the disclosure and transparency requirements, the new guidance highlights that “making it clear it’s an ad is only the beginning” and reminds influencers that any advertising and affiliate marketing that they publish will also be subject to the broader rules of the CAP Code, such as the requirement to substantiate claims and to not mislead consumers. There is also a reminder that influencers will have to comply with further requirements when advertising certain products such as food, alcohol and gambling products.
Nevertheless, certain industries have yet to provide a clear picture of advertising standards for influencers, in what some have called the “wild west of influencer advertising”. This is the case with fintech – challenger banks such as Revolut, Monzo or Starling are increasingly using influencers to promote their brands and services to their young customer base. Financial advertising is heavily regulated, and while the ASA has confirmed it has received multiple complaints regarding fintech use of influencer marketing, neither the ASA nor the Financial Conduct Authority has consulted each other to consider regulation of influencer financial promotion beyond the simple #ad labelling.
Although the new guidance is welcome, there is still some way to go to properly educate influencers on their responsibilities. While it is acknowledged that it would be impossible for the ASA to provide comprehensive examples of all types of influencer marketing activities that may fall foul of the rules, there are clear steps that can be taken to better inform both brands and influencers. In particular, it would be useful to see the ASA work more closely with social platforms to establish disclosure tools that satisfy the CAP Code.