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FTC Changes

The FTC is Changing Influencer Marketing As We Know It

Photo credit: Wallblog

Photo credit: Wallblog

Transparency is key these days when it comes to walking the line between what is genuine and what is sponsored. Especially when it comes to brand and influencer marketing. You may not have noticed a slight but somewhat drastic change to the way many celebrities and influencers now promote and caption product sponsorships. What is behind all of this recent change?

The United State’s Federal Trade Commission (FTC) for years has been the enforcer of what is called ‘deceptive’ advertising, and they have now set their sights on social media marketing and influencer partnerships. The message from the FTC is clear: Users, influencers and celebrities need to be more clear-cut in their messaging or face steep penalties and potential lawsuits from the government.

Photo Credit: PetaPixel

Photo Credit: PetaPixel

What does this mean for brands that use influencers and celebrities for promote their products? It isn’t clear-cut yet, but it does mean that posts will have a more “sponsored feel’. Frequently used hashtags such as #ad, #sp, #sponsored, are not always enough and it’s a move that could make posts seem much less authentic.

With the steady decline of television marketing, major brands such as Warner Bros. Home Entertainment, Lord & Taylor, Laura Mercier Cosmetics and other companies around the world have poured millions of dollars into social media marketing. According to Captiv8, a company that connects influencers with brands, more than $255 million has been spent in the last few years on social media advertising and influencer marketing.

There is still a huge gray area in terms of what you can and need to post in order to not be considered “deceptive” and no brand is safe. Any compensation, including free products, should be disclosed, the FTC says. Other gray areas include videos and Snapchat, where there’s not an obvious place to put a hashtag, and the videos are only a few seconds.

With the ever changing landscape of social media influencer marketing, both brands and the FTC will need to define straightforward guidelines and definitions of what is authentic and was is a paid product placement. Ultimately, the consumer is the winner in this battle, because if a consumer knew an endorser was compensated in any way, would that alter the view of the endorsement? The FTC says yes.

Like this post? Check out past blogs in the archive below.