Last week, the US-based Performance Marketing Association (PMA) released the Compliance Guide for Influencer Marketing. With channel adoption on a steady rise, the aim of this document – according to PMA executive director Tricia Meyer – is not to “enforce” but to “educate” the industry about guidelines and best practice; “it applies to not only influencers but affiliates, publishers, and endorsers,” she adds.
With the PMA joining a number of other trade bodies as an Association Partner of PI LIVE and the Influencer Marketing Show, PerformanceIN caught up with Meyer to discuss recent cases of non-disclosure, the importance of regulation and the channel’s maturation.
Earlier this year, the Federal Trade Commission (FTC) issued over 90 letters to influencers and marketers. Can you tell us a bit about what those letters were about?
Tricia Meyer: The FTC sent letters in March to influencers whom they believed did not properly disclose in their Instagram posts that they were being compensated by brands. The letters were educational but indicated that the FTC expected the influencers to follow the disclosure guidelines or there could be consequences. The FTC subsequently followed up with 21 of the influencers in September. Those letters indicated that the influencers had to provide a written response to the FTC whether the influencers were compensated along with what actions the influencer would be taking to properly disclose. We’ll see after their end of September deadline if the FTC follows up again.
What’s the real damage from non-disclosure? What are the wider implications?
TM: In general, non-disclosure hurts consumer confidence. They feel mislead when they find out that an influencer they followed was compensated for the things that they endorsed. When the disclosure is made at the time of the endorsement, the consumer is given the choice how heavily to weigh the endorsement. Influencer marketing is on the rise but brands could see a backlash against working with influencers if the customers continue to feel like they are being duped into buying products by hidden sales pitches.
Since those letters, an example of which is available here, has there been a lot of improvement in terms of influencers disclosing paid-for content?
TM: On the whole, non-disclosure hasn’t changed must since the FTC letters. People who were disclosing before continue to disclose. People who were not are still not. The only real change is that some brands are starting to be more careful about putting disclosure language into their endorsement contracts. How they are monitoring and dealing with non-compliance remains to be seen.
Why do you think the issue of disclosure in influencer marketing has only really taken serious hold in the last couple of years?
TM: Influencer marketing itself has changed greatly in the last couple of years. Formerly brands were using mainly big celebrities in commercials as endorsers and most people understood that the celebrities were likely getting paid. Now celebrities are endorsing in “casual” social media posts. In addition, brands are looking to more niche influencers who consumers don’t suspect are being compensated every time they post or review something. With these changes, the FTC has had to give more guidance on what it means to disclose those connections.
What’s the PMA’s involvement in enforcing this, and how are you helping a movement towards full disclosure across influencer marketing?
TM: The PMA does not seek to enforce disclosure but rather to educate the performance marketing industry about the guidelines and best practices. We continue to work toward more clarification with the FTC specific for our industry and will be meeting with early next year. In addition, we participate in conferences, summarize FTC documents, and share as much information as soon as it comes out. We have also created a number of free resources including a recent whitepaper entitled ‘Compliance Guide for Influencer Marketing: What You Need to Know’.
What’s the best practice for disclosure? How can marketers make sure they’re fully covered?
TM: In social media, the FTC has repeatedly said that #ad used early in the post is the most effective means of disclosure. It’s concise, easily understood, and can be used on almost any platform. Aside from that, the best way to ensure that disclosure is sufficient it to be sure that the audience understands the nature of the endorsement relationship and that the disclosure will not be overlooked by the reader. This allows for some flexibility while allowing the marketer to be somewhat creative with what’s best for their own audience.
On influencer marketing in general, is this push towards better regulation symptomatic of the channel’s growing maturity?
TM: More widespread adoption of the channel is certainly a part of its growing maturity and with that there is a certain necessity for regulation. Hopefully, the channel itself will bear some of that self-regulation in an effort to stave off more government regulation. The worldwide reach of our business complicates that but does not make it impossible.