Feds Warn Social Media ‘Influencers’ To Stop It Already With The Stealth Ads

Like it or not, the fact is that we’ve crossed through the mirror into a world where people are paid lots of money to mention a product, wear an article of clothing, or sip some ab-tightening tea… not because they are famous but because they get paid lots of money to mention products they got for free, wear comped clothing, and drink dubious tea — a well-dressed, flat-tummied, ouroboros shown off in impeccably framed and filtered Instagram shots. You might find it repellant, but it’s legal, so long as all of that cash and compensation is adequately disclosed — a message that a number of “influencers” and their handlers have either ignored or not received.

So today, the Federal Trade Commission announced that it had sent out 90 letters to influencers and their corporate benefactors, telling them to please — for the sake of what goodness remains in this world — follow the flippin’ rules when it comes to paid endorsements.

Since these letters are not official actions, the FTC does not identify the individuals and companies involved. However, a template letter [PDF] provided by the agency does show that the notices address specific instances of possible guideline violations.

More precisely, they address the possibility that certain Instagram posts may have failed to adequately disclose the “material connection” between the advertiser and the influencer (I swear; I lose a month off my life every time I write that word) who didn’t just happen to be talking up their amazing new socks from their favorite store.

The FTC rules require that such connections be “clear” and “conspicuous,” and burying “#ad” at the bottom of a 70-word Instagram caption with a dozen other hashtags is probably neither clear nor conspicuous.

Even you put in a clear disclosure at the end of your Instagram caption, that may still fall short, as the Instagram mobile app truncates captions to only their first three lines. The FTC notes that many people don’t click “more” to read the full caption.

“Therefore, you should disclose any material connection above the ‘more’ button,” advises the letter. “In addition, where there are multiple tags, hashtags, or links, readers may just skip over them, especially where they appear at the end of a long post.”

While the FTC has taken advertisers to task for failing to disclose connections with social media influencers — most notably Lord & Taylor and Warner Bros. Home Entertainment — these secret ads have continued to be a problem, particularly on Instagram.

Today’s announcement is actually in response to a petition filed last year by a coalition of consumer advocates, who pointed to dozens of instances of apparent secret ads from every strata of Instagram influencer, from bona fide celebrities, to celebrity hangers-on, to porn stars, to people who have millions of followers but don’t appear to actually do anything, to professional social media failure Scott Disick.

Public Citizen, which spearheaded that petition, is applauding the FTC letters as a necessary step toward cracking down on this stealthily sponsored tomfoolery.

“We live in an era where celebrities and average citizens are sharing every detail of their lives on social media, from what they ate for breakfast to selfies featuring their ‘favorite’ products. It is often unclear whether an Instagram user is paid to post a product endorsement or if they genuinely use it,” says Kristen Strader, campaign coordinator, Public Citizen’s Commercial Alert. “That’s exactly why brands are using influencer marketing as a primary way to reach young consumers.”

However, Strader cautions that this is all for naught if there is no follow-through: “Until the FTC takes enforcement actions against repeat offenders, the culture around influencer marketing will not change and consumers will continue to be misled.”

The Campaign for a Commercial-Free Childhood was also part of the 2016 petition. In a statement to Consumerist, CCFC points out that this stealth advertising problem isn’t limited to Instagram.

“We’re glad the FTC is encouraging influencers on Instagram to be more forthright, but we hope they expand that initiative to include YouTube and other social media, which reach millions of children,” says CCFC, “and we hope the FTC will take strong action against any influencers who refuse to comply with the rules.”

Want more consumer news? Visit our parent organization, Consumer Reports, for the latest on scams, recalls, and other consumer issues.