OCTOBER 19, 2020 by LARA O'REILLY
Instagram last week agreed to make a series of
changes to encourage influencers to clearly label when they have been paid or
incentivized by advertisers to publish a post, following an investigation from
the U.K.’s Competition and Markets Authority. Experts said they look favorably
on the changes — which are rolling out not just in the U.K., but globally — as
another step towards professionalizing the nascent influencer marketing space.
As part of the package of changes, Instagram’s
“paid partnership” labelling tool — which appears below a user’s name to
display the advertiser relationship — will be extended to all users globally.
Ahead of posting, users could be prompted to
confirm whether they have been incentivized to promote a product. Instagram has
said it will deploy technology and algorithms to assess when users may have not
disclosed their post was in fact sponsored. Labelled posts will not be treated
differently than organic posts by Instagram’s news feed algorithm, according to
the company.
That labeled posts are not treated differently
is significant, said Oliver Lewis, founder and managing director at News UK
influencer marketing unit The Fifth Group.
“Part of the reason labelling is overlooked is
fear around engagement and deprioritizing” posts in the feed,” said Lewis.
For advertisers, Instagram will create a tool
to help them understand how their products are being promoted by users and to
request the removal of unauthorized or inadequately labeled posts. Instagram
will report back to the CMA about the number of instances these suspected
unauthorized endorsements occurred. The tool will also give advertisers more
data — such as conversion and brand-lift metrics — to encourage them to require
influencers to disclose their commercial relationships.
Instagram has committed to making all of the
changes (detailed in this document) by June 2021. In
the meantime, it will provide the CMA with quarterly reports about its
progress.
Instagram’s changes — characterized as
“undertakings” by the CMA — form part of the regulator’s wider investigation
into misleading online endorsements. In January last year, the CMA called out
16 celebrities — including pop singers Ellie Goudling and Rita Ora
and models Alexa Chung and Rosie Huntington-Whiteley — for failing to
disclose that they had been paid or rewarded for some of their social media
posts.
The CMA has not yet disclosed whether its
investigation found Instagram’s practices have breached U.K, consumer
protection law, which holds business, users and social media platforms
accountable for displaying clear disclosures alongside paid-for content.
Influencer marketing is also top of mind for
U.S. regulators. In February the Federal Trade Commission said it would review whether
it needs to update its endorsement guides to reflect new requirements and
penalties for social media companies.
Advertising industry observers welcomed
Instagram’s moves.
“We feel that this is one of many stages of
maturity to follow in the influencer [and] branded content space,” said Paul
Kasamias, managing partner of performance at media agency Starcom, via email.
“This is following a similar pattern to most channels … when they reach a point
of real scale, the market and industry start to question its validating and
ethical [and] moral stance.”
Leo Lännenmäki, cofounder and CTO at
Finland-based influencer marketing platform Matchmade, said other social
platforms will also likely follow Instagram’s lead, or be forced to by
regulators in different jurisdictions.
“The hope is that [labeling] will be
standardized across different platforms,” said Lännenmäki. However, he added,
“I think we are a long way from that: Every platform will still continue to
have their own mechanisms.”
Many of the issues within the influencer
marketing space are often through lack of knowledge and education rather than
creators deliberately attempting to flout the rules, said Phil Smith, director
general of U.K. advertiser trade association ISBA.
“Particularly in that long tail where
transactions can take place on a handshake … this kind of interruptive
education and giving people the information they need at the time in which
they’re making these posts is absolutely right,” said Smith.
Instagram said it is also working with U.K. ad
industry nonprofit MediaSmart to create educational material to help young
people learn more about branded content. The first of these materials is
expected to be available in December 2020, with a bigger push to follow in
January once students return to school after the Christmas holiday.
While Instagram’s forthcoming changes are a
step in the right direction, the overall influencer market still has a long way
to go before it reaches real maturity. For one, it’s not even clear how
reliable the data is about market size, given the number of casual deals that
take place in the DMs.
“I don’t think we have really fully understood
structurally, philosophically and psychologically the role influencer marketing
is playing in marketing,” said Barry Lowenthal, CEO of ad agency The Media
Kitchen.
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