FTC Reminds Social Media Influencers and Brands to Clearly Disclose Relationship to Consumers

The FTC says that consumers viewing Instagram posts on mobile devices typically see only the first three lines

FTC Reminds Social Media Influencers and Brands to Clearly Disclose Relationship to Consumers
Image: Pixabay
April 20, 2017

After reviewing numerous Instagram posts by celebrities, athletes, and other influencers—the Federal Trade Commission (FTC) recently sent out more than 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.

The letters were informed by petitions filed by Public Citizen and affiliated organizations regarding influencer advertising on Instagram and Instagram posts reviewed by the FTC. They mark the first time that the Commission has reached out directly to educate social media influencers themselves.

The FTC's Endorsement Guides provide that if there is a "material connection" between an endorser and an advertiser—in other words, a connection that might affect the weight or credibility that consumers give the endorsement—that connection should be clearly and conspicuously disclosed, unless it is already clear from the context of the communication. A material connection could be a business or family relationship, monetary payment, or the gift of a free product. Importantly, the Endorsement Guides apply to both marketers and endorsers.

In addition to providing background information on when and how marketers and influencers should disclose a material connection in an advertisement, the letters each addressed one point specific to Instagram posts. The FTC says that consumers viewing Instagram posts on mobile devices typically see only the first three lines of a longer post unless they click "more," which many may not do. The Commission's letters informed recipients that when making endorsements on Instagram they should disclose any material connection above the "more" button.

The letters also noted that when multiple tags, hashtags, or links are used, readers may just skip over them—especially when they appear at the end of a long post—meaning that a disclosure placed in such a string is not likely to be conspicuous.

Some of the letters addressed particular disclosures that are not sufficiently clear, pointing out that many consumers will not understand a disclosure like "#sp," "Thanks [Brand]," or "#partner" in an Instagram post to mean that the post is sponsored.

The FTC's letters were sent in response to a sample of Instagram posts making endorsements or referencing brands. In sending the letters, the Commission says that it did not predetermine in every instance whether the brand mention was in fact sponsored, as opposed to an organic mention.

In addition to the Endorsement Guides, the FTC has previously addressed the need for endorsers to adequately disclose connections to brands through law enforcement actions and its business education efforts.