Home News Influencers Are on Notice As a Consumer Protection Organization Focuses on Hidden Social Media Advertisements

Influencers Are on Notice As a Consumer Protection Organization Focuses on Hidden Social Media Advertisements

Influencers Are on Notice As a Consumer Protection Organization Focuses on Hidden Social Media Advertisements

Influencers and content creators on social media have been told by Australia’s consumer watchdog to come clean about their commercial deals and income streams.

The Australian Competition and Consumer Commission (ACCC) will next week launch a national sweep of online platforms such as Instagram and TikTok, and is warning those with large followings to be more up-front about whether they are getting paid for product placement.

South Australian social media influencer Chloe Grayling has built her online following by blogging about living a wholesome lifestyle.

Some of her recent videos include clips of her with her pet Himalayan cows and renovating her 140-year-old cottage on the Fleurieu Peninsula.

Ms Grayling has 60,000 Instagram followers and nearly a million on the video platform TikTok, and these numbers are growing every day.

She takes pride in being transparent when she is paid to promote products, which happens around three to four times a month.

“I’m pretty particular about what I accept as gifts or product partnerships,” Ms Grayling said.

“Quite recently, a few of the platforms have rolled out a tool that tells people that the post is part of a paid partnership, and that shows right at the top of your post so it can’t be missed which is really helpful.

“If that’s not available I would use ‘#ad #gifted’ just to make it really clear to people that it’s something I’ve been provided with in exchange for.”

That attitude has not always been reflected across the industry, nor around the globe.

Last year, American celebrity Kim Kardashian was fined $US1.26 million by the United States Securities and Exchange Commission for not disclosing a sponsorship in an Instagram post.

Australian social media podcaster Amy Taeuber said similar non-disclosures are widespread.

“I think at the moment the influencer space is like the wild west,” she said.

“There are a lot of influencers who are failing to actually disclose if a post is a paid ad.

“There are a lot of things that are happening that are unregulated and I think there’s a lot that needs to change.”

‘Magnifying glass on influencers’

The ACCC has reached out to its own followers on Facebook, encouraging them to dob in influencers doing the wrong thing.

In addition, it will target false statements promoting products, cases in which key information has been omitted, and posts paid for by sponsors that have not been clearly or appropriately labelled.

Under Australian consumer law individuals can face penalties of up to $2.5 million and companies up to $50 million, for breaches.

Ms Taeuber said some influencers avoid posting sponsorship details due to fears about what disclosing commercial deals might do to their personal brand.

She said those using the popular hashtag “sponcon”, meaning “sponsored content”, were still potentially misleading their audiences.

“When I see #sponcon I think, ‘You don’t want to say #ad, because you don’t want to look like a sell-out,'” she said.

But Ms Taeuber said recognition that influencer marketing is “big business” has been growing, and there is now “more of a magnifying glass on influencers” than ever before.

“If better rules aren’t brought in it will get worse and worse,” she said.

“In the marketing space, people are realising how influential Instagrammers and YouTubers are, so they’re using them for big campaigns and their fees are increasing.”

She believes there should be an anonymous option when making a complaint against an influencer.

From free handbags to free holidays

The ACCC is not the only body with influencers in its sights.

The Australian Taxation Office (ATO) has made significant changes to its gift policy, meaning products that have been donated, and then advertised, now have to be declared at tax time.

Tegan Boorman — a lawyer who specialises in social media, and deputy chair of the Australian Influencer Marketing Council — disputed the influencer space was “like the wild west” as a lot of regulations had been put in place in recent years.

She believes the new ATO rules go further than many think.

They encompass everything from “a free handbag” to a “free holiday”, she said.

“It’s really important to be aware of what you’re promoting and if there are any laws or specific guidelines that apply in relation to that,” she said.

“If you’re not sure of those, you should definitely be getting advice.”

Such content also includes paid-for attendance at events or dinners.

“There was this understanding that PR events are OK, and you didn’t need to disclose you were attending a PR event for a free ticket or goodie bag or something like that,” Mr Boorman said.

“[But] I think it’s really important for people to understand, if they have received some sort of incentive to be there and they are going to post that to their audience, they do need to distinguish that from the content they post organically on their accounts.”

‘Great move for everyone’

For Chloe Grayling, the crackdown is also an opportunity that will help businesses take social media more seriously.

“It’s a really positive step for the industry of creators and because it lends legitimacy to an industry that’s come a really long way in the last few years,” she said.

She said while the rules had been “a little bit murky” in the past, greater constraints meant greater clarity.

“Having something that’s really clear and really stable and really easy to access is going to be a great move for everyone,” she said.

“These changes will help influencers be more considered with what content they’re sharing.

“My rule is, I wouldn’t recommend [anything] I watch, read or use that I wouldn’t recommend to my mum or sister.”

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