Last week Myleene Klass was the latest celebrity influencer to fall foul of advertising rules for failing to disclose social media posts as ads in a triple whammy of rulings by the Advertising Standards Authority (ASA).
A day later, the UK’s competition watchdog, the Competition and Markets Authority (CMA) published new guidance for social media platforms, brands and content creators, outlining its principles to follow so that users are protected and can obviously spot what is an ad, in a bid to hit home to all in the industry that the issue will remain under watchful eyes.
Klass is one of a sizable line of celebrities that have come under fire for failing to disclose content as ads – with the roll call this year alone including Kim Kardashian and former Love Island alum Molly-May Hague. But it’s not just the influencers themselves that can face the rap – the brands they are promoting are often called out.
A handful of incidents may not be the cause for instant alarm. But with consumer trust in brands and their ambassadors at arguably an all-time high, is there a danger that call-outs of this nature can encourage consumers to become sceptical and switch off to anything they may perceive to remotely constitute a marketing message?
PMW spoke to industry insiders to get their take on the steps brands and influencers need to take to ensure transparency, and the potential fall out for the discipline of influencer marketing if that is eroded.
“Failing to clearly label paid-for endorsements erodes trust”
Social media users are becoming more savvy when it comes to spotting a post that is unintentionally or otherwise masquerading as independent content when it is in fact a promotion. But it is an area where the lines can perhaps all too easily be blurred, despite clear rules around labelling and repeated warnings of sanctions against those that flout the rules.
Scott Guthrie, Board Member of the Influencer Marketing Trade Body, is clear on the impact and the dangers for influencer marketing in the future. “Influencer marketing’s success relies on authenticity and transparency.
Failing to clearly label paid-for endorsements or gifts is effectively attempting to hoodwink the consumer. This erodes trust in both the creator and the sponsoring brand. It also does our industry a disservice reputationally.” Guthrie is not alone in his concerns for the industry as a number of celebrities and brands continue to blur the lines.
Nicole Kivel, VP of Strategic Retail, Bazaarvoice said: “This issue is one that will hurt brands and overall consumer confidence. Consumers want to follow individuals they feel like they know and trust, making transparency over brand affiliations essential. That isn’t to say sponsored content has no place in the marketing landscape, but it needs to be clear and serve a real purpose, both in terms of what the product is and which influencer is being used.
“Unfortunately, Myleene Klass is just another in a long list of those who have fallen foul of the regulations, a list which has also included Kim Kardashian in recent months, but it is cases such as these which can devalue the entire concept, undermining trust, and consumer confidence – not to mention the damage it can do to people’s bank balances.”
Kivel points to research from Bazaarvoice earlier this year which found just 16% of UK consumers trust sponsored posts on social media. Two-thirds of those surveyed said they look to everyday influencers that they follow for authentic product recommendations, while only 12% look to celebrities.
“This presents brands with a huge opportunity to utilise UGC throughout marketing efforts, with unofficial ambassadors that are authentic and trusted by followers and customers alike,” she concludes.
“Consumers expect some kind of transactional relationship”
David Berkowitz, SVP of Corporate Marketing and Comms at Mediaocean, points out that consumers can forgive influencers not marking content as ads, as they are almost expectant that any endorsement will involve some kind of deal. But will they forget?
“Consumers are increasingly savvy and likely expect that much of what celebrities and other influencers endorse involves some kind of transactional relationship. It’s rare for someone with a sizable following to tout their favourite book, trainers, or hotel without it being a sponsorship. It’s different from Ben Affleck routinely getting photographed grabbing coffee from Dunkin’ which he manages to regularly, albeit perhaps unintentionally, endorse.
“While consumers tend to be forgiving over influencers’ unmarked paid endorsements, it’s important for both brands and influencers to be mindful of the latest endorsement rules to minimise kerfuffles with regulators and avoid any negative press that follows suit.”
The message then? Transparency in posting content is vital, not only to ensure a fair playing field for your audience, but to avoid future scepticism from increasingly aware consumers. The publicity surrounding these rulings may not only hamper the industry, but future offenders will be less able to claim that they’ve made a ‘mistake’ with the examples made of those before them.
“None of us should have to play detective”
The ASA told PMW that because many consumers have less experience with social media ads, lines can be blurred between editorial content and commercial message – which can confuse, and ultimately mislead, followers.
It said: “None of us should have to play detective in working out whether the media that we see, hear and interact with is advertising. We should always know, right from the start, when we’re being advertised to. We can then make an informed choice about whether we want to find out more about what [an ad] is promoting.”
Almost 5,000 complaints were submitted to the ASA about influencer posts in 2021, an increase of 20% year-on-year, and constituting nearly a quarter of all online cases. Not all these complaints necessarily concern disclosure of advertising, but the channel – and discipline around it – is naturally attracting more attention, not least from the watchdog itself. All this means is that there is more opportunity for mistakes to be made, as Klass and those before her have discovered.
“Myleene Klass suffered a trifecta of rulings against her by the ASA,” Guthrie observes. “Two of the rulings focus on the singer promoting her own products – in this case books and bikinis. The CMA’s new guidance explicitly deals with influencers and their own brands explaining ‘if creators own (in full, co-own or in part), or are employed by a brand and use their social media account to promote its products, they must make this known and clearly label these posts as ads’. Klass didn’t. She was clobbered for it.
“The former Hear’Say pop star also fell foul of the regulator for failing to declare her ads were ads when promoting the shoe brand, Skechers. The new CMA guidance reminds us that it’s businesses as well as influencers that can be held accountable for misleading customers.”
Understanding obligations
Kivel comments that the watchdogs have “done well in recent years to catch onto those that skirt the regulations implemented to help influencers stay authentic and transparent.
“However, it's clear that there's still some way to go, especially as some celebrities are still blurring the lines.”
The CMA’s new guidance for brands includes working with content creators to ensure they “understand their legal obligations to disclose upfront and clearly that any content they post for the brand is an ad”, even if the arrangement is informal.
“If you send out free gifts to content creators, make sure you include clear instructions that any content posted as a result must be labelled as an ‘Ad’. This applies, even if you don’t ask for anything in return.”
It also notes that organisations should also make checks themselves on content that refers to their brand or business, warning that “where content is published on the businesses’ behalf, you may be held responsible if it is misleading”.
Brands under the spotlight
Indeed, influencer posts that have fallen through the transparency cracks, including those last week, have resulted in a spotlight on some big brand names – including Next, Skechers and Prettylittlething.com. While there was defence from the brands on behalf of those serving them, the ASA held firm, and held both parties accountable in these cases.
Alongside the published guidance, there is also a set of resources for content creators themselves, as well as a set of six principles for social media platforms, including their responsibility to facilitate legal compliance from brands, and to make it easy for users to report suspected hidden ads easily.
The rules: pure and simple
Guthrie sums it up: “Promotional posts should clearly display that they’re ads using #Ad or #Advert and by staying well clear of hashtags including #gifted, #sponsored, #affiliate, #collab, #PRHaul or phrases such as ‘Funded by’, ‘PR Stay’, ‘In association with’, ‘made possible by’, or ‘ownbrand’. These hashtags and phrases are deemed ambiguous by the CMA. “As well as being clearly labelled as an ad it must be obvious it’s an ad as soon as anyone engages with the content. That means for carousels or sequences - whether videos or photos - where viewers can access individual posts - each item that contains promotional messaging must also be labelled.”
As for future enforcement, the ASA warns that those persistently failing to work within the rules will lead to further sanctions, which in June 2021 included the set-up of a ‘name and shame’ page for consistent offenders.
It says: “Where an influencer/brand appears unwilling or unable to work within the rules that we’ll consider further sanctions, including considering lining up the worst offenders for referral to statutory authorities for consideration of legal sanctions as well as working directly with the host platform to pull the plug on problem accounts.”