Flemish newspaper “De Standaard” reported in late September on the story of a Flemish Youtuber, who encouraged his underage fans in a number of films online to buy t-shirts and hoodies with his logo via his Youtube channel. In itself nothing newsworthy, but the young “entrepreneur” explicitly urged his followers to steal the credit card of their parents or hack their Paypal account to pay for their purchases and that was just a little too entrepreneurial for some viewers who filed a complaint with the “Jury for Ethical Practices in Advertising” (JEP) shortly thereafter. The latter ruled on 12 September that the young man was violating fair trade practices with his message.

More and more Youtubers, vloggers and Social Influencers get an important part of their revenues from advertising and / or merchandising and often they use all kinds of (not clearly communicated) forms of product placement, exaggerated incentives to buy or to conceal sponsor deals. Moreover, it is very often found that selling through these channels does not comply with the rules on distance selling, while without any doubt also forms of e-commerce or social commerce.

Social commerce

Youtube itself, as an online video platform, does not allow to directly sell products to the users / viewers. Most Youtubers use, apart from the Youtube platform, a web page to sell their merchandising effectively or provide the necessary links to the web pages of third parties. Youtube serves mainly as a means to – not always subtly – advertise their products or products of third parties.

We can be brief about this underlying website, which naturally has to comply with all rules concerning distance selling, cookies and data protection (GDPR and local national law).

The question, however, is how to deal with other social and video platforms that allow direct sales. Technology, especially from companies such as Belgian based Zentrick, makes it possible to go directly to a shopping basket via overlayers or pop-ups in a video and thus to realize a sale from the video itself. While looking at a commercial video, a viewer can move the cursor over the screen, and get pop-up information on prices and product information as well as the possibility to click through to an order page …

In that context, there is indeed question of distance selling or e-commerce (social commerce, actually) through the video platform and in that case all rules for distance selling have to be respected from the initial video. For example, certain information must be communicated to the consumer “from the beginning of the ordering process”.

This means that information about the accepted means of payment, the existence of a return right or the identity of the seller must already be mentioned from the beginning of such an interactive video. Problem is of course that these legal mentions do not fit into the visual story that the advertiser is trying to tell. In the case at hand, the vlogger should have reported from the beginning of his video that he accepted payments by credit card and paypal and that buyers had a right to a 14 days cooling off period, as well as address details of the seller, … The spontaneity of his vlog would have been lost from the start…

“Steal your father’s credit card”

YouTube does not allow sales, as already mentioned, but that does not mean that vloggers on Youtube are not bound by rules. They must indeed take into account the provisions of consumer law that deal with unfair commercial practices and in particular the prohibition of unfair, misleading or aggressive commercial practices. It is against one of these rules that the enterpreneurial young man in our example sinned. It is forbidden to incite children directly to purchase advertised products. Exactly that was the reason why the JEP pronounced a conviction in this specific case.

The Belgian Code of Economic Law also contains several rules on advertising, which are supplemented with all sorts of sector codes for which the JEP is competent. One of the basic principles is thlat advertising must always be recognizable as such and that the identity of the advertiser has to be clear.

Conclusion

Social commerce offers great opportunities for creative entrepreneurs, but also outside a classic web shop the rules for distance selling have to be taken into account. After all, these are independent of the medium used and apply to every sale where buyer and seller are not at the same physical location. Moreover, it is very attentive to rules of consumer protection and advertising law on social media and video platforms. Questions about e-commerce or social media?