The Competition and Markets Authority (CMA) is expressing concern regarding social media influencers and celebrities not properly indicating when they have been paid to endorse a product or experience. They have launched an investigation into the matter, due to the fact that these people with large internet followings could impact the shopping preferences and habits of potentially millions of people.
Problems arise when these influencers do not clearly disclose that they are being paid by the brand for their opinion and endorsement. According to the watchdog group, they have seen examples of the problematic posts themselves which are left unclear as to whether they reflect a personal opinion or are sponsored by a brand. As part of the investigation they’ve reached out to influencers to “gather more information about their posts and the nature of the business agreements they have in place with brands,” and are asking the public to share their experience with celebrity endorsed products.
Influencers and social media based marketing have been a boon to brands in recent years, as they allow them to reach more targeted audiences and boost overall sales. Under the current consumer protection law, influencers must disclose or make clear that they are being paid for their post, opinion and endorsement. If such posts are not labeled, consumers can be misled to believe that the endorsement represents the influencers own personal opinion or view.
George Lusty, the CMA’s senior director for consumer protection, explained, “Social media stars can have a big influence on what their followers do and buy.” He continued, “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.”
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