Arguably one of the most significant commercial impacts of the advent and rise of social media has been the emergence of influencers. Brands have realised the power these individuals have over their audiences and are increasingly allocating bigger chunks of their marketing budgets to this new route to customers.
However, it has been reported that many brands have been paying influencers to advertise their goods or services without disclosing that it is advertising, and regulators have started to clamp down.
If a brand is paying an influencer (whether in cash or product), the influencer must disclose that. Similarly, if a brand has control over an influencer’s content, then that content must be labelled with ‘ad’ or similar; no longer will wording such as ‘sponsored by’, ‘thanks to’ and ‘in association with’ be sufficient.
Influencers may not be alive to the regulatory requirements and/or may not want to label their content as an ‘ad’, but it is the brands and agencies engaging the influencers which face the greatest risk of action from the regulator.
Therefore it is essential that brands and agencies address these issues at the outset and ensure they have appropriate influencer contracts in place.