UK investigates celebrities over social media promotions

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Celebrities and influencers who endorse products without labeling their social media posts as paid-for by brands were warned on Thursday that they were breaking the rules as Britain’s regulator launched an investigation into the trend.

Recommendation from celebrities and social media influencers who have millions of followers is a growing marketing strategy for brands, but the UK Competition and Markets Authority (CMA) said that such endorsements could mislead customers.

Kim Kardashian attends the CFDA Fashion Awards in Brooklyn, New York, US, June 4, 2018. /Reuters Photo

It said it had seen posts that appeared to promote items or offer a celebrity’s personal endorsement of a product, without it being clear whether the post had been paid for by the brand in question.

“If people see clothes, cosmetics, a car, or a holiday being plugged by someone they admire, they might be swayed into buying it,” said George Lusty, the CMA’s Senior Director for Consumer Protection.

Selena Gomez arrives at the 2017 American Music Awards in Los Angeles, California, US, November 19, 2017. /Reuters Photo

“So it’s really important they are clearly told whether a celebrity is promoting a product because they have bought it themselves, or because they have been paid or thanked in some way by the brand.”

The CMA said it had written to a range of famous people to gather more information about their business agreements with brands, and also wanted the public to share their experiences as part of the investigation.

Juventus' Cristiano Ronaldo before the match, August 12, 2018 /Reuters Photo

Consumer giants such as Pernod Ricard, Unilever, Nestle and Mars have all spent money on so-called influencers to promote products.

Brands will pay anywhere from 10,000 US dollars to more than 100,000 US dollars for a single social media post, depending on the size, engagement, and loyalty of the person’s followers, and Unilever said it accounted for “tens of millions” of its 7.7 billion euro marketing last year.

The most famous can earn even more. Reality TV stars Kylie Jenner and Kim Kardashian, singer Selena Gomez and Portuguese footballer Cristiano Ronaldo are the top-paid celebrities per post on Instagram, earning up to one million US dollars a post, according to social media analytics firm HopperHQ.

Their posts are often tagged “paid partnership with,” “#sponsored” or “#ad” to indicate that the stars have been paid by the brands in question.

(Cover photo: Travis Scott and Kylie Jenner arrive at the Metropolitan Museum of Art Costume Institute Gala [Met Gala] in the Manhattan borough of New York, US, May 7, 2018. /Reuters Photo)

Source(s): Reuters