HUGE numbers of influencers in Europe routinely flout disclosure rules, study finds

The European Commission and various national consumer protection authorities have been carrying out a sweep of posts by 572 influencers. They found that 97% of those influencers posted commercial content but only 20% systematically indicated that their content was advertising. 

In addition, the sweep found that:

• 38% did not use platform labels that disclose commercial content, such as the “paid partnership” toggle on Instagram. Many used inadequate wording such as “collaboration” (16%), “partnership” (15%) or generic “thanks to the partner brand” type wording (11%).
• Only 34% of influencers' profiles made the disclosure immediately visible without needing additional steps, such as by clicking on “read more” or by scrolling down.
• Out of the 40% of influencers who endorsed their own products, services or brands, 60% of those did not consistently, or at all, disclose advertising.

What happens next?

The European Commission says that national authorities will take action with regard to 358 influencers. 

Some markets, like Italy, have already made influencer marketing a high priority following recent influencer-related scandals, and are taking action where the behaviour is very serious and could amount to fraud.

In addition, the European Commission will consider if action is required under the Digital Services Act, which comes fully into force on 17 February 2024, and which, among other things, requires platforms to empower users with information about advertisements they see, such as why the ads are being shown to them and who paid for the advertisement. 

The results of the European Commission's sweep will also feed into the fairness fitness check of EU consumer law, which the Commission launched in 2022. The fitness check is reviewing the Unfair Commercial Practices Directive, the Consumer Rights Directive and the Unfair Contract Terms Directive to establish if they deal effectively with issues like dark patterns, personalisation practices, influencer marketing, contract cancellations, marketing of virtual items, or the addictive use of digital products.

The report is topical in light of the efforts made by the ASA to ensure that influencers disclose their partnerships appropriately, as well as complying more generally with the CAP Code and UK consumer laws. 

We've written before about whether the ASA's insistence on ‘Ad’ or ‘#ad’ is the best way to deal with disclosure, and whether it should be concentrating more on the posts that actually cause consumer detriment.  It will be interesting to see if the EU takes a sledgehammer to crack a nut approach, or employs a more nuanced one.