Why disclosure is good for business in influencer marketing

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Why conspicuous influencer marketing disclosure of any material connection between brand and influencer is good for business.

 

Digital influencers and brand sponsors should be guided by three principles:

 

  1. Disclose clearly and prominently which content has been paid for
  2. Be open about other commercial relationships relevant to the content; and
  3. Give honest opinions on markets, businesses, goods or services

 

Still, many influencers fail to follow the appropriate governance when working with brands on sponsored content. New figures from the Advertising Standards Authority (ASA), the UK advertising watchdog, reveal there were 1,824 complaints about content on social networking sites in 2016, up 193% from 622 in 2012. 

 

Satisfying influencer marketing disclosure regulation is good for brands, good for influencers and good for their audiences. Here’s why:

 

Influencer marketing disclosure: Influencers should clearly and conspicuously disclose their relationships to brands when promoting or endorsing products through social media.

 

Legal requirement to effectively indicate when content is sponsored

 

Brands and influencers are legally required to indicate when a piece of content on social media is sponsored.

 

In the UK the nuances of policing influencer marketing continue to be explored by the Competition and Markets Authority (CMA) and the ASA's regulatory arm, the Committee for Advertising Practice (CAP).

 

CAP issued a fresh set of guidelines for brands and social media influencers in March.

 

A piece of content doesn’t become an advertisement just because it’s paid for. To be an ad the content has to be paid for and controlled by the brand.

 

A brand paying an influencer to post an image is an ad - and therefore falls under the ASA. A brand asking an influencer to create some content based on a creative brief will be sponsorship. This content will follow under the auspices of the CMA.

 

In the US, the Federal Trade Commision (FTC), the independent agency of the US government promoting consumer protection and regulating influencer marketing, continues to refine and tighten its guidelines on the discipline.

 

Earlier this year, the FTC sent 90 letters reminding influencers and marketers that influencers should clearly and conspicuously disclose their relationships to brands when promoting or endorsing products through social media.

 

21 of the influencers who got the April letter received a follow-up warning letter, last month citing specific social media posts the FTC staff is concerned might not be in compliance with the FTC’s Endorsement Guides.

 

Further afield, in Australia, the Australian Association of National Advertisers amended its Advertiser Code of Ethics. It now requires social influencers to be more transparent about sponsored posts and commercial connections.

 

Section 2.7 of the Code requires that advertising or marketing communications must be clearly distinguishable as such to the relevant audience.

 

Globally, the consumer protection authorities of nearly 60 countries work together through the International Consumer Protection and Enforcement Network (ICPEN) to encourage global co-operation among law enforcement agencies. ICPEN has penned its own guidelines for dealing with digital influencers.

 

Social media influencers need to work with brands to ensure ads are clearly labelled. Unclear online ads can mislead shoppers and damage businesses playing by the rules.

 

Transparent influencer marketing disclosure is the ethical thing to do

 

Regulation aside, disclosing a commercial relationship between brand and influencer is the right thing to do. Savvy Influencers are transparent about the branded content they produce because they don’t want to deceive their followers.

 

Consumers don’t have an issue with seeing sponsored content in the feeds of the influencers they follow, with a couple of provisos:

 

  1. They’re not hoodwinked into believing it’s editorial they’re engaging with
  2. The sponsored content is at least as good as the organic content produced by the influencer. If it’s great content the audience will engage with it regardless of whether it’s sponsored or organic

 

Failure to disclose diminishes trust

 

61% of women said they won’t engage with an influencer’s sponsored content if it doesn’t feel genuine, according to a global survey of 20,000 conducted by Bloglovin, a blog aggregator site.

 

At their core, true influencers provide consistently compelling content and high levels of community engagement. Over time this helps them earn trust from their fans and establish themselves as credible voices.

 

Trust and authenticity are the bedrock of influencer marketing. Lose trust and authenticity and you lose the power to influence an audience, and with it the promotional work.

 

Effective influencer marketing disclosure is good for business

 

An influencer’s audience understands the commercial imperative to do sponsored work. The money earned from this enables the influencer to dedicate more time to creating organic content.

 

But, there must be a common thread in the tone of voice and shared values between influencer and brand. Get it right and influence will be strengthened. Get it wrong - or work with too many different brands - and an influencer’s authenticity will be lost. Soon to be followed by their audience.

 

When selecting an influencer it’s important to look beyond the usual benchmarks of reach and resonance. It’s wise to ensure your short-listed influencer shares the same values as your brand. Read How to build influencer marketing measurement best practice.

 

Sponsored content featuring Pets & Animals outperform non-branded content by an average of 11% according to CampaignDeus data.

 

Tracking performance

 

Patterns of performance vary from influencer to influencer, across verticals, and across post types. Sometimes posts flagged as brand-sponsored actually outperform organic posts. For example, in the Pets & Animals vertical we find branded posts outperform non-branded by an average of 11%. In other verticals, there’s a significant drop off.

 

CampaignDeus’s proprietary database helps brands understand the factors affecting influencer performance, and what to expect from influencer selections. We collect information on influencer branded campaigns across a wide range of dimensions. Our data can answer questions like:

 

  • Which influencers perform best on which types of posts, in which verticals?
  • Which products are most commonly featured, how do these perform for certain brands?
  • What emotional tones work best across which platforms?

 

With the right data and following the right guidelines, brands and influencers can work together effectively to build excitement and share great content.

 

Our core belief at CampaignDeus is that smarter pre and post-campaign data analysis is good news for brands and good news for influencer marketers. Using data-driven analysis helps brands and influencer marketers deliver more effective, more transparent influencer marketing campaigns.

We have been working on these methodologies since inception. We’re able to provide all of the data, along with firm recommendations, to brands, agencies and media companies here in the UK. You can get in touch with us here to learn more.


Scott Guthrie works with companies to drive business growth in the social age through strategic insight and technical know-how. A former digital director of influencer relations at Ketchum, Scott is now an advisor at CampaignDeus. You can find Scott on LinkedIn and Twitter, or on his blog.

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