It’s no surprise that a digital marketing publication like ClickZ would release a study asserting today’s consumers are less focused on ads than content. While it makes me worry for future generations, there’s no doubt the Kardashian freakshow moves a lot of merchandise with their tweets and posts.
The ClickZ report includes this particularly aggressive claim: influencer marketing generates $6.50 for every dollar spent.
ClickZ claims a 600% ROI from Influencer Marketing.
While that number seems inflated, there’s no doubt this is an effective platform. Influencers provide direct access to specific audiences unreachable with other media. People prefer to hear from consumers they trust rather than companies. And marketers don’t have to produce anything themselves. Win, win, win!
However, even as this report came out last week, the FTC announced it had sent letters warning 90 Instagram influencers that they must disclose all paid posts, whether that payment came in cash, gifts or free products. The Commission specifically stated that just appending posts with #sp for ‘sponsored post’ wasn’t enough; they want disclosure at the top, above the “More” button.
Two things about this seem odd. First, the FTC sent actual letters? Isn’t that adorably old school?
But more to the point, the letters failed to spell out any penalties. This second point is crucial; historically, the government has preferred to target companies, not individuals. Two years ago, Kim Kardashian made posts promoting the morning sickness pill Diglecis (seriously, who names these drugs?), without divulging they were paid posts. That neatly sidestepped the mandatory publishing of the lengthy risks and contraindications disclosures. The pharma company Duchesnay USA, not Ms. Kardashian, got off with just a warning.
While I’m sure the wording was very stern, that was it; no fine, no nothing.
Further, advertising watchdog Truth In Advertising Inc. filed a complaint to the FTC last year citing over 100 disclosure-regulation violations for Kardashian-Jenner family posts. But nothing happened, nothing changed, and its naive to think it will. When you get famous via a sex tape released by your Mom, you’re not easily cowed into submission.
Yes, many consumers recognize that celebrity brand mentions don’t come for free. In fact, paid influence should be a $1 billion business this year on Instagram alone. With no reason to think this growth will slow, the FTC will have to step up and do something to level the playing field.
The current administration may favor a hands off approach, but given the pervasiveness of social platforms, deregulation can quickly devolve into deception.