Influencer marketing is big business, with brands expected to spend more than $15 billion on the marketing strategy by 2022. With growth comes oversight, and the Federal Trade Commission (FTC) has stepped in to help influencers stay on the straight and narrow with the release of a new publication that explains to influencers how they should disclose brand sponsorships.
“Many consumers rely upon influencer recommendations in making purchasing decisions, and they should know when a brand paid an influencer for an endorsement, because it affects the weight and credibility the consumers may give to that endorsement,” said Michael Atleson, a Staff Attorney for the FTC's Bureau of Consumer Protection.
Photo from the FTC
What Is The Purpose Of The FTC’s Guidelines For Influencers?
The FTC guidelines for influencers are essentially meant to enforce Section 5 of the FTC Act, which prohibits deceptive advertising. Although the FTC isn’t “coming after” influencers for making false claims – they are more likely to investigate the responsible advertisers or ad agencies – they do want influencers to adhere to specific guidelines when divulging their relationships with brands.
How Can Influencers Disclose Their Brand Relationships?
Often, when working with brands, an influencer will write #Ad at the end of the post touting the product or service. The FTC is now saying that isn’t enough; the FTC wants simple and prominent disclosures in brand posts or stories.
When working with influencers, brands should discuss ways of disclosing brand/influencer relationships that adhere to the FTC guidelines. Examples include, placing the disclosure in the message itself, instead of at the end, not mixing the disclosure in with a slew of other hashtags and, when making a video, repeatedly mentioning the relationship throughout or having it superimposed over the picture. Neither brand nor influencer should assume audiences know they are partners or rely on platform disclosures as sufficient.
Brands should also make clear that influencers don’t tout unproven claims or endorse the product or service before trying it, both of which violate the FTC guidelines and could lead advertisers to be investigated by the FTC.
When Don’t Influencers Have To Disclose Partnerships?
According to the FTC, “If you [an influencer] have no brand relationship and are just telling people about a product you bought and happen to like, you don’t need to declare that you don’t have a brand relationship.”
Why Is The FTC Issuing Influencer Guidelines?
Social media advertising is expected to top $37 billion globally in 2020. An article from NPR about the FTC guidelines notes that influencers’ financial power will continue to grow with increased social media advertising, and the FTC guidelines are likely in response to that emerging influence. Brands that work with influencers will need to ensure that consumers are aware of those relationships, both to benefit from the value that can come from effective partnerships and to continue building trust with their consumer base.
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