The Competition and Markets Authority (CMA) has launched an investigation into concerns that social media influencers, who can sway the shopping habits of millions of consumers, may not be properly disclosing that they have received money in return for their posts.
The CMA said it had complaints that social media stars are not properly declaring when they have been paid, or otherwise rewarded, to endorse goods or services. Typically, celebrities and influencers have millions of followers who watch their channels to see where they go on holiday, what they wear, which products they use, the books they read and more.
The CMA said it has already seen examples of posts which promote, endorse, or give personal opinions on a product without stating if they have been paid a fee.
Online endorsements from celebrities and influencers can help brands reach target audiences and boost sales.
However, influencers must make it clear in such posts that they have been paid or rewarded to promote, review or talk about a product in their social media feeds under consumer protection law.
As part of its investigation, the CMA has written to a range of celebrities and social media influencers to gather more information about their posts and the nature of the business agreements they have in place with brands
George Lusty, the CMA’s senior director for consumer protection, said: “Social media stars can have a big influence on what their followers do and buy. If people see clothes, cosmetics, a car, or holiday being plugged by someone they admire, they might be swayed into buying it.
“So, it’s really important they are clearly told whether a celebrity is promoting a product because they have bought it themselves, or because they have been paid or thanked in some way by the brand.”
If the CMA finds practices that break consumer protection law, it can take enforcement action – which could lead to naming and shaming of anyone breaking the rules, and potentially prosecutions.
As part of the investigation, the CMA is asking the public to share their experiences. It said that its investigation team would particularly benefit from hearing from people who have bought products which were endorsed on social media.
The Advertising Standards Authority has previously taken action against celebrities who have failed to clarify that they were being paid for posts, such as TV presenter AJ Odudu who tweeted a photo of an Alpro dessert with text describing it as one of her favourite snacks, in line with “key messages” promoted by the brand – without stating that she was being paid.