FTC is reviewing endorsement rules; watchdog group seeks CGI inclusion

It’s About Time

The FTC’s endorsement guides are up for review. And boy, do they need it.

They were last amended in 2009, and we all know how much has changed since then. Now that the world is hurtling forward on Internet time, perhaps it’s time to reevaluate the FTC’s 10-year review schedule?

Given the glacial review process, Truth In Advertising Inc. (TINA) isn’t going to let this opportunity go by without weighing in. They’ve been a prickly burr on the backside of social media influencers since 2016, when they exposed an undisclosed ad for Coca-Cola in a Selena Gomez Instagram post.

TINA is weighing in on the endorsement guide through the open comment period (you can join in too) with a letter that covers a number of topics: disappearing posts, endorsements aimed at children, and audience expansion through fake accounts. These topics are all worth reviewing, but we want to focus on the strangest, coolest aspect of TINA’s recommendations: How should the Commission rein in virtual influencers?

Turing Fail?

A global takeover by a malevolent artificial intelligence (AI) is a mainstay of science fiction. Generally, the AI that seizes control evolves from a military project — think the Terminator franchise, or Colossus: The Forbin Project, if you’re into the oldies. But what if the impending AI overlord was born in the marketing industry?

Before you laugh, consider that virtual influencers — computer-generated characters used to promote brands and products on social media — are regularly brushing shoulders with our online personae. Lil Miquela, for instance — a virtual influencer created by an independent company — endorses a variety of products. She has 2.4 million followers. She also releases spacey pop music.

Will Lil Miquela and her ilk take over our credit card accounts and start shopping for us? The influencer singularity might be closer than you think. Consider the following stat, outlined by TINA in the press release accompanying its comment: 42 percent of respondents to a recent survey followed an influencer without knowing the account was virtual.

The Takeaway

What does TINA want the FTC to do? Well, it should start by officially adding virtual influencers to its definition of endorsement, the watchdog says. Then, it should make the virtual influencers subject to the same disclosure requirements that real humans are.

These suggestions, however, are simply an extension of existing guidance.

Things get more interesting when it comes to the guidance provision requiring that endorsements “reflect the honest opinions, findings, beliefs, or experience of the endorser.” What can that mean when applied to a virtual influencer? TINA suggests new disclosures to reveal the virtual nature of the influencer, which cannot have “opinions” or “beliefs” in the normal sense of the word.

Read the letter. It’s chock-full of interesting recommendations and contains a helpful historical perspective on influencer advertising.