Social media influencers and the law

Posted on Monday February 4, 2019

It was recently reported that various high profile celebrities including Ellie Goulding have agreed to change the way in which they post online. In particular, certain celebrities have agreed to clearly state whether or not they have been paid or received any gifts or loans of products which they endorse.

The news comes following warnings from the Competition and Markets Authority (CMA) that such posts could fall in breach of consumer law and that such endorsements can be misleading. The CMA announced that it has obtained commitments from 16 social media influencers about how they post online. It was also revealed that the Advertising Standards Agency had issued hundreds of warnings to social media influencers in relation to their endorsements of products and services online.

Earlier this month the CMA published new consumer law compliance guidelines for social media influencers, which followed investigations it had made into social media advertising.

The guidance sets out details relating to how social media influencers should make clear that they have been paid for endorsements.

Suggestions in the new guidance include:

  • Making clear that the influencer will be receiving a reward for advertising the product
  • Using indicators such as “#Ad’ or “Advertisement Promotion”
  • Using the Paid Partnership feature when advertising on Instagram
  • Being open about the influencer’s relationship with the brand and stating that the post is promotional in nature

Andrea Coscelli, Chief Executive of the CMA, commented on the issue, noting that social media influencers have a huge impact on what their fans decide to buy. He stated “You should be able to tell as soon as you look at a post if there is some form of payment or reward involved, so you can decide on whether something is really worth spending your hard-earned money on”.

The conduct of social media influencers online is a topic of great concern for regulators, particularly revealed by the recent pledges obtained from celebrities. As such, businesses should ensure that any influencer advertising campaigns which they embark upon comply with the guidance issued by the CMA. It is very important to review the guidance and make sure that social media posts are properly labelled in relation to endorsements.

It remains to be seen as to whether the hashtag “#ad” will be trending following these developments.

We regularly advise brands, social media influencers and sports professionals on the matter of online promotions. See our most recent example at  https://www.mackrell.com/legal-news/rafinha-faces-e1m-fine-for-breaching-contract-with-adidas/ .

For advice on advertising and consumer law, please contact Sej Lamba on Sehaj.lamba@mackrell.com.