Consumers are no strangers to seeing products and services being endorsed or promoted by celebrities and other high profile personalities. Whether it’s Cheryl Cole urging you to use a particular shampoo “because you’re worth it”, or Gary Lineker telling you all about a new range of crisps; consumers understand that advertisers use the image, reputation and following of celebrities in order to create a positive association between the celebrity and their product.

The reach of celebrity endorsements has now transcended the more traditional forms of advertising such as television, magazine and billboard advertising to the individual and personal social media profiles and pages of the celebrity endorsers themselves. Some celebrities have hundreds of thousands, and in some cases millions, of followers on the social media platform Twitter, with whom the celebrity is able to communicate instantly in 140 character bursts. This opportunity has not gone unnoticed by advertisers and it has become almost a staple part of a sponsorship arrangement to require a certain number of sponsored tweets.

The difficulty is that, unlike with traditional advertisements and because of the personal nature of social media, it is not always clear to the consumer whether a celebrity is commenting on a product or service because of a contractual obligation or because of a sincere, incidental and genuine appreciation for it.

What does the law say?

UK Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing (CAP Code)1

Since March 2011 the remit of the CAP Code, published by the Committee of Advertising Practice, has been extended to cover promotional messages on companies’ own websites and social media pages under their control. Therefore, when running promotions on their social media pages, or using celebrities or making claims about their products, for example, companies must comply with the provisions of the CAP Code.

In addition to the general provisions prohibiting misleading advertising, the particularly relevant provisions of the CAP Code are found in Section 2 (Recognition of Marketing Communications) which, among other things, provides that:

  • Marketing communications must be obviously identifiable as such;
  • Marketing communications must not falsely claim or imply that the marketer is acting as a consumer or for purposes outside its trade, business, craft or profession; and
  • Marketing communications must make clear their commercial intent, if that is not obvious from the context.

The Consumer Protection from Unfair Trading Regulations 2008 (CPRs)2

In addition to the provisions of the CAP Code, the CPRs, which implement the Unfair Commercial Practices Directive into UK law, specifically prohibit traders from, among other things:

  • Falsely claiming or creating the impression that the trader is not acting for purposes relating to his trade, business, craft or profession, or falsely representing oneself as a consumer.

What can advertisers do?

The CAP Code and the CPRs do not prevent advertisers from using celebrities to endorse products and services on social media platforms; they simply require celebrities and advertisers to be transparent by making it clear to consumers that the marketing messages are paid for.

Facebook

While the CAP Code and CPRs apply equally to promotional messages on Facebook as they do elsewhere, advertisers must also be aware that Facebook’s terms of service3 prohibit users from posting unauthorized commercial communications. As such, advertisers should not consider paying celebrities to promote products or services on their personal Facebook pages regardless as to whether they disclose the commercial nature of the communication or not. Last year Facebook banned Ad.ly from the service for paying celebrities to endorse products in their Facebook page updates.

Twitter

Unlike with Facebook, Twitter currently does not prohibit commercial messages and has therefore become a haven for advertisers desperate to reach a global audience. However, with only 140 characters to play with, it is difficult for advertisers and celebrity endorsers to make it clear that their tweets are promotional/paid for and thus in compliance with the CAP Code and CPRs.

This issue has come to the attention of the Advertising Standards Authority (the independent industry regulator of advertising) twice this year, leading to two different outcomes:

  • In March 2012, in its first investigation involving Twitter, the ASA dismissed a complaint4 relating to a Twitter based campaign run by Mars where Katie Price and Rio Ferdinand were paid to make certain promotional tweets, including:

You’re not you when you’re hungry @snickersUk #hungry #spon

  • A few months later in June 2012, the ASA upheld a similar complaint5 relating to a Twitter based campaign run by Nike where Wayne Rooney and Jack Wilshere were paid to make promotional tweets, including:

My resolution – to start the year as a champion, and finish it as a champion… #makeitcountgonike.me/makeitcount

The ASA found that the Nike sponsored tweets were not obviously identifiable as promotional messages for which Rooney and Wilshere were paid. The subtle and yet fundamental difference between the two campaigns was the inclusion of the hash tag “#spon” within the promotional tweets for Mars. The ASA was satisfied that #spon was sufficiently prominent to make the tweet “obviously identifiable” as a marketing communication and therefore compliant with the CAP Code.

The ruling follows the joint guidance issued in November 2011 by the Internet Advertising Bureau UK and the Incorporated Society of British Advertisers6 which advises advertisers to ensure that Twitter users endorsing products and services disclose the paid-for nature of the tweet by including “#ad” within it.

It is worth noting that Nike appealed the ASA’s decision but was unsuccessful after the Independent Reviewer found that there were no grounds for the regulator to revisit the matter.

Final thoughts

Advertisements and promotions will inevitably become a growing feature within social media and so it is critical that advertisers are aware of and continue to comply with, the CAP Code and CPRs when creating their online campaigns.

Whilst the Nike and Mars decisions may appear to offer an easy solution to advertisers by using #ad or #spon in paid-for Twitter messages, the application of the CAP Code and CPRs to other areas of social media has not yet been tested and as a result advertisers should not apply a one-size-fits-all approach and should seek legal advice where appropriate.