The ACCC has this week started a sweep to identify misleading testimonials and endorsements by social media influencers. It will also look at more than 100 influencers mentioned in over 150 tip-offs from consumers who responded to the ACCC’s Facebook post asking for information.
Most of the tip-offs from members of the public were about influencers in beauty and lifestyle, as well as parenting and fashion, failing to disclose their affiliation with the product or company they are promoting.
“The number of tip-offs reflects the community concern about the ever-increasing number of manipulative marketing techniques on social media, designed to exploit or pressure consumers into purchasing goods or services,” ACCC Chair Gina Cass-Gottlieb said.
“We want to thank the community for letting us know which influencers they believe might not be doing the right thing,” Ms Cass-Gottlieb said.
“Already, we are hearing some law firms and industry bodies have informed their clients about the ACCC’s sweep, and reminded them of their advertising disclosure requirements,” Ms Cass-Gottlieb said.
The sweep is being run over the coming weeks as part of the ACCC’s compliance and enforcement priorities for 2022/23, with the broad aim of identifying deceptive marketing practices across the digital economy.
As part of the sweep, the ACCC team is reviewing a range of social media platforms including Instagram, TikTok, Snapchat, YouTube and Facebook, and livestreaming service, Twitch. The sweep is targeting sectors where influencer marketing is particularly widespread including fashion, beauty and cosmetics, food and beverage, travel, health fitness and wellbeing, parenting, gaming and technology.
In conducting the sweep, the ACCC is also considering the role of other parties such as advertisers, marketers, brands and social media platforms in facilitating misconduct.
“With more Australians choosing to shop online, consumers often rely on reviews and testimonials when making purchases, but misleading endorsements can be very harmful,” Ms Cass-Gottlieb said.
“It is important social media influencers are clear if there are any commercial motivations behind their posts. This includes those posts that are incentivised and presented as impartial but are not. The ACCC will not hesitate to take action where we see consumers are at risk of being misled or deceived by a testimonial, and there is potential for significant harm.
This action may include following up misconduct with compliance, education and potential enforcement activities as appropriate.”
Many consumers are aware that influencers receive a financial benefit for promoting products and services. However, the ACCC remains concerned that influencers, advertisers and brands try to hide this fact from consumers, which prevents them from making informed choices. This can particularly apply to micro influencers with smaller followings, as they can build and maintain a more seemingly authentic relationship with followers to add legitimacy to hidden advertising posts. The ACCC is therefore monitoring a mix of small and larger influencers in the sweep.
This sweep follows a similar initiative carried out in 2022, which focused on identifying misleading online reviews and testimonials posted on business’ websites, their social media pages and third-party review platforms. A report outlining the findings from 2022 will be published in the coming months.
“Online markets need to function well to support the modern economy. Part of that is ensuring consumers have the confidence they need to make more informed purchasing decisions,” Ms Cass-Gottlieb said.
The ACCC will publish the findings of this sweep once the results have been analysed.
Each year, the ACCC announces a list of Compliance and Enforcement priorities. These priorities outline the areas of focus for the ACCC’s compliance and enforcement activities for the following year. As part of the 2022/23 Compliance and Enforcement Priorities, the ACCC is prioritising both consumer and fair-trading issues in relation to issues relating to manipulative or deceptive advertising and marketing practices in the digital economy.
The ACCC is also conducting the Digital Platform Services Inquiry that is focused on the provision of social media services, including sponsored posts and influencer advertising on social media platforms. We will provide the sixth interim report on social media services to the Treasurer by 31 March 2023.
There are also industry led practices and guidelines which provide a standard for Australian influencer businesses and advertisers. For example, the Australian Association of National Advertisers provides guidance on what can be considered clearly distinguishable advertising. The Australian Influencer Marketing Code of Practice also outlines best practice for companies engaging in influencer marketing, including in disclosing advertisements.
Other regulators such as the Australian Securities and Investments Commission, the Therapeutic Goods Administration and the Australian Health Practitioner Regulation Authority are also responsible for regulating influencer conduct in their areas of jurisdiction. The ACCC engages with these regulators to determine which is best placed to take action in relation to any misleading or deceptive conduct.
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