Watchdog Launches Investigation On Social Media “Influencers”

An investigation has been put in motion amid concerns social media stars are not making it clear when they have been paid to promote goods or services.

The Competition and Markets Authority (CMA) is investigating into whether social media “influencers”, who can earn thousands from companies for one post, are misleading consumers. They are also concerned that their posts may not be meeting consumer protection law requirements, which is to properly label them.

Another main concern is that followers may place trust in a product endorsed by a celebrity, and may think it is their personal view, rather than a paid promotion. Many brands use online celebrity promotions in order to reach their target demographic and boost sales.

CMA’s senior director for consumer protections, George Lusty, stated: “Social media stars can have a big influence on what their followers do and buy.

“If people see clothes, cosmetics, a car, or a holiday being plugged by someone they admire, they might be swayed into buying it.”

“So, it’s really important they are clearly told whether a celebrity is promoting a product because they have bought it themselves, or because they have been paid or thanked in some way by the brand.”

An example of celebrity endorsements from Kylie Jenner plugging PureLeef. Source: KylieJenner/Instagram

Although many high-profile influencers use the hashtag “#ad” to clarify that they’ve been paid to post about a product, CMA states that a commercial post must be immediately clear when viewing the post, so the hashtag may not be enough.

Certain celebrities, who have not been named by the CMA, are expected to be invited to interviews while the investigation persists into this grey area. The public will also be asked to share their experiences, particularly from anyone who had actually bought the products endorsed on social media.

The Advertising Standards Authority also received many complaints this year, prompting an investigation into influencer advertising. As a result, it issued a number of rulings against minor celebrities for failing to disclose they were being paid to endorse products.

Another case in 2016, involved makeup Instagram blogger, Sheikhbeauty, who promoted Flat Tummy Tea in her posts, describing it as a herbal detox tea.

Social media influencers raising numbers at an event. Source: Financial Review

When researching these posts, the CMA say they have viewed a number of posts which appear to promote or endorse products without clearly explaining if the post had been paid for. It also saw posts where celebrities share their personal opinions, once again without disclosing if they had been paid by the brand.

The CMA are currently investigating to gather more information about the kind of deals they have with brands, and if they find that these practices break consumer protection laws, they could take on enforcement action.

So, always remember that just because your favourite actor or singer is endorsing a certain product, chances are it may just be down to marketing purposes and sponsored content, so do always think twice before you hit that “buy” button.


Story by Emily Clark

Featured Photo Credit: Sky News

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