CCPC research on social media influencers highlights the need for improvements in labelling influencer ads

Just 10% of Irish consumers trust the information provided by influencers, but consumers overestimate their ability to recognise influencer ads



20 December 2022

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Failure to label content as advertisements is widespread throughout social media influencing, according to a new report published by the Competition and Consumer Protection Commission (CCPC).

In a new report on social media influencers, the CCPC found that just 10% of consumers trust the information provided by influencers. However, while consumers distrust influencers in general, they do appear to trust the influencers that they follow.

Research found that consumers are reluctant to use the word “influencers” in reference to personalities they follow on social media platforms, preferring instead to use terms such as “interactive celebrities” and “people of interest”.

That consumers did not readily agree that such terms were interchangeable with the term “influencer” suggests they may be overconfident in their ability to recognise influencer advertising and may be vulnerable to misleading practices, the CCPC stated.

Poor levels of labelling ads

What’s more, almost 50% (48.4%) of the commercial content reviewed by the CCPC was not labelled as advertising in any way. Poor levels of labelling relating to influencers’ marketing of their own brands was an area of particular concern identified in the research.

The CCPC’s wide-ranging research also reveals that many consumers who bought as a result of influencer promotions feel they were misled in their purchases. However, consumers say they can be reluctant to report such issues to a regulatory authority such as the CCPC, preferring instead to unfollow such influencers.

Consumers raised specific concerns around influencers promoting cryptocurrencies and other financial products, particularly when the influencer had no experience in the area.

Consumers and influencers interviewed for the research agreed that clear guidance would be beneficial for everyone, particularly for more vulnerable social media users (e.g. children and teenagers). This research also suggests that requiring influencers to use a small number of tags, such as #advertisement, #AD and #PaidPartnership, would reduce inconsistencies in labelling methods amongst influencers, particularly for when influencers promote their own brands.

“This research shows that influencer marketing is constantly evolving and as such influencers and consumers alike need clarification in relation to the labelling of social media advertisements,” the CCPC stated.

“Platforms and brands must take greater responsibility for educating and informing their users and consumers, and must support influencers in clearly and consistently labelling paid content. We will monitor social media platforms for progress in this area. It’s crucial that platforms, brands, influencers and agents understand their responsibilities and abide by the law. We will also work with the ASAI to develop guidance which will provide greater clarity in relation to responsibilities and requirements,” the commission added.

Need for transparency and clarity

“Influencer marketing has accelerated exponentially in more recent years, having originally developed in a more organic and unstructured way in the domestic market,” said Orla Twomey, chief executive at The Advertising Standards Authority for Ireland.

“The need for transparency and clarity from influencers regarding social media advertisements is greater than ever and plays an essential part in increasing consumers’ trust in advertising they are seeing and hearing,” she added. “Consequently, and notwithstanding the levels of required disclosure by influencers, it is concerning to learn from this survey that the level of trust that consumers have in information they receive from influencers is as low as 10%.

“The research reveals that while there is a need for more consistency in transparency from influencers with regard to labelling their sponsored content clearly and correctly, there is also demand for more guidance and education for both consumers and influencers alike in this space. We are looking forward to working with the CCPC to develop further guidance,” Twomey added.

*(Source: The research, which took place between October 2021 and April 2022, used a combination of focus groups, surveys, interviews and social media analysis to reach its conclusions)



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