What do Alexa Chung, Mario Falcone, Binky Felstead, Ellie Goulding, Holly Hagan, Rosie Huntington-Whiteley, Michelle Keegan, Iskra Lawrence, Millie Mackintosh, Megan McKenna, Chloe Sims, Zoe Sugg, Louise Thompson, Dina Torkia, Rita Ora and James Chapman have in common?
Apart from anything else, they were all involved in an investigation – which began in August 2018 – carried out by the CMA to assess whether influencers are clearly disclosing when they had been paid or otherwise rewarded to endorse goods or services and have volunteered to change their practices going forward.
This information was released last week, along with some guidance, which is well worth a read: Social media endorsements: being transparent with your followers. This follows on from advertising guidance co-published by the CMA and the CAP in September which explains how to comply with consumer protection law and the Advertising Codes enforced by the ASA. Also worth a read: Influencer’s Guide.
There is a lot of chat about this on Instagram at the moment and a lot of people are confused. This sort of thing is where the unusual combination (although not as unusual as you might think) of my day job as a lawyer and my hobby of running an interiors instagram account come in rather handy. So I thought I’d set out some FAQ style information. The questions are in bold so you can just skip to the ones you are interested in.
What is the CMA?
The CMA is short for the Competition and Markets Authority. It is the UK’s primary competition and consumer authority (sometimes referred to as a Watchdog). It is an independent department with responsibility for carrying out investigations into mergers, markets and the regulated industries and enforcing competition and consumer law. You may have previously heard of the OFT (Office of Fair Trading) and the Competition Commission but these no longer exist, since the CMA took over their functions in 2014. One role of the CMA is to enforce the law relating to influencers.
What about the ASA?
The ASA is short for the Advertising Standards Authority. It the UK’s independent advertising regulator. Its role is to ensure that the UK Advertising Codes, which lay down rules for advertisers, agencies and media owners, are followed.
Someone also mentioned the CAP …?
The CAP (Committee of Advertising Practice) is the organisation that writes the UK Advertising Codes that the ASA then enforce.
I’ve heard these are just guidelines, is it actually the law or can I take my own view?
The key piece of consumer protection legislation relevant to the CMA’s investigation is the Consumer Protection from Unfair Trading Regulations 2008. That bit is the law. There are also other laws that are relevant to influencer marketing, so it is not just a case of reading one bit of legislation and following that. The guidelines have therefore been produced to help to explain to influencers how to comply with all of the relevant laws.
So yes, they are guideline but unless you are super confident that you understand all of the laws and know better than the CMA and the CAP, the easiest and most sensible thing to do is to make sure you follow the guidelines.
I don’t care about guidelines, tell me what actual law I might be breaking if I talk about how much I love an item that I was given for free six months ago, without mentioning that I got it for free (because I told my followers at the time that it was a gift).
The Consumer Protection from Unfair Trading Regulations 2008 prohibit unfair commercial practices. Paragraph 22 of Schedule 1 makes it clear that it is considered unfair in all circumstances to falsely represent oneself as a consumer. It is reasonable for followers to assume that you have paid for something in exactly the same way that they would have to, unless you say otherwise.
How can I be expected to know all of this?
If you use your social media platform to promote brands, in exchange for payment or free/discounted items you are considered to be an influencer. It is the responsibility of influencers, their agents, and brands to keep up-to-date with relevant consumer protection law as well as any guidance from the ASA and CAP about complying with its Advertising Code.
What is the worst that can happen if I don’t follow the guidelines?
Influencers who breach the regulations could incur both civil and criminal sanctions. The CMA are responsible for bringing any such claims. They could apply to the courts for an enforcement order to prevent infringements. They could also prosecute for contravention of the Consumer Protection from Unfair Trading Regulations 2008. However this is very much worst case scenario and would only be in very serious cases where it was considered that civil action would not meet its objectives.
What is the most likely consequence if I don’t follow the guidance?
The most likely consequence is that a competitor or consumer reports you to the ASA and the CMA. They would write to you with some advice and guidance and ask you to remove or change the non compliant posts. In the case of a serious breach they may start an investigation which could result in a formal ruling against you.
So what should I be doing to make sure that I follow the guidelines?
The key to complying with the CMA and ASA guidelines is to be clear by:
- ensuring that anyone who looks at your post or story (including those who are not familiar with instagram) will know if you received some “payment” in relation to an item featured in that post or story;
- declaring any past relationships involving “payment” with a brand or business, even if the purpose of that particular post or story is not related to that relationship;
- ensuring people know if you are promoting your own brand or event; and
- making sure that if you haven’t used a product or service that you are promoting you say so.
The way in which you do this is up to you but it must be transparent, easy to understand, unambiguous, timely and prominent and apparent without the need for people to click for more information, no matter what type of device they’re using to view the post. This means that the disclosure should be made upfront, not hidden within text or at the end of a post.
If you have relationships with several brands or businesses featured in the same post, make sure you state all of these prominently and clearly.
The simplest and neatest option, in my view, would be to put [AD] prominently and at the start of any post/story, where there is or has been an element of payment in the last 12 months and make sure affiliate links are clearly marked.
If you don’t fancy that, because it feels unclear to you or you don’t want people to think you have been paid actual pound coins when you haven’t, then I think you need to use plain English to explain what the situation is. Again this must be prominent and at the start of any post, not at the end, in small type or hidden in the text.
Perhaps a compromise would be to use [AD*] and then at the bottom of the post or in small writing if it is a story, use the * again to explain the situation in full, which brands you have had a past relationship with etc etc.
What counts as payment? Surely a free poster from a local mum doesn’t count!
The CMA considers payment to be any form of reward, including money, gifts of services or products, or the loan of a product. This would also include a discount that was not available to an ordinary consumer.
What counts as a past relationship?
Anything within the last 12 months.
To my mind, this means that for interiors influencers who get a lot of gifts, almost all of their posts will include a declaration as they will contain an item or items that have been gifted within the last 12 months or an item paid for in full by the influencer but from a brand which has previously gifted an item.
Is there a list of things that definitely would be a breach of the guidelines?
Yes, the CMA has confirmed that all of the following would be insufficient (note this list is not exhaustive):
- tagging a brand or business in either the text, picture and/or video of a post without additional disclosure;
- tagging a gift from a brand in in either the text, picture and/or video of a post without additional disclosure;
- using discount codes in a post without additional disclosure;
- using ambiguous language without additional disclosure in a post (for example ‘thank you’; ‘made possible by’; ‘in collaboration with’; or ‘thanks to…’);
- unclear use of hashtags, for example using #sp; #spon; #client; #collab; etc.
- adding #ad directly after the name of the brand or business (for example #[BRANDNAME]ad)
- when the disclosure (for example #ad, #advert) is not prominent because it is hidden at the end of or among other text and/or hashtags;
- product placement where there is an associated (and undisclosed) payment or other incentive;
- disclosing the a commercial affiliation only on an influencer’s front, home or profile page.
I think that is probably quite enough from me for now. I could definitely go on and haven’t covered every detail by any means but I suspect you are bored by now. I am not an expert but if you have any questions, feel free to ask in the comments and I will do my best to answer.
I realise I haven’t even touched on my actual thoughts about it, this blog post is too long already but in brief, my view is that it is bad news for brands, good news for consumers and about equal for influencers. I have a lot to say and am very happy to discuss in the comments section if you are interested or perhaps I will do another post at some point.
Please note: this blog post does not constitute legal advice and should not be relied upon as such.