by Alberto Crivelli, founding partner, and Giusy Cardinale, attorneys at AMTF Avvocati
What is influencer marketing?
Influencer marketing is the ability to 'influence' choices, to create strategic word of mouth, especially on social networks, which exponentially amplifies a brand's visibility. The evolution of digital media, platforms such as YouTube, Instagram, podcasts, and blogs allow for exposure that was unthinkable just a few years ago.
Although at first glance it appears to be a much more immediate and 'simple' tool than advertising campaigns shared through traditional media (television, print, etc.), influencer marketing is actually subject to constantly evolving regulations.
What should/shouldn't you do when advertising a brand or product?
The first principle to be respected is undoubtedly that of 'transparency'. When the authors of communications do not reveal the promotional purpose of their expressions, they give rise to what is known ashidden advertising.
Hidden advertising misleads consumers because, by not making the promotional purpose of its statements explicit,it could potentially influence consumer behavior. Therefore, hidden advertising occurs when the promotional message of the communication is notclear, truthful, and accurate.
Given the continuous development of influencer marketing, the Italian Competition and Market Authority (AGCM), as the competent authority for the application of the Consumer Code, has emphasized in its various interventions, such as the first and second moral suasion on influencers and brands, that: "advertising must be clearly recognizable as such, so thatthe commercial intent of a communication is perceptible to the consumer" and that "the prohibition of hidden advertising is general in scope and must, therefore,also beapplied with reference to communications disseminated through socialnetworks,as influencers cannot lead people to believe that they are acting spontaneously and disinterestedly if, in reality, they are promoting a brand."
In 2016, the Institute of Advertising Self-Regulation also addressed the issue with the publication of the so-calledDigital Chart, which was incorporated into the Code of Self-Regulation for Commercial Communication. With regard to commercial communication, the Code of Self-Regulation specifies that it "(...) must always be recognizable as such (...) and must be clearly distinguished by means of appropriate measures."
The IAP Digital Chart, as also reiterated by the AGCM, has therefore identified the general parametersthat influencers must comply with in order to avoid illegally misleading consumers and thus to make the promotional purpose of their sponsorships clearly recognizable.
Among the possible solutions proposed is, for example, the addition of certain warning hashtags such as:
- #advertising;
- #sponsored;
- #advertising;
- #paidadvertisement
or, in the case of supply of goods, even if free of charge:
- #productsuppliedby
- #gifted
wording that mustalwaysbe followed by the brand name.
What happens in the event of a violation of the regulations?
Anyone who violates the rules laid down by the AGCM is subject to measures and sanctions ranging from simple investigation of practices deemed suspicious, to suspension of the commercial practices in question, to very heavy financial penalties. Article 27 of Legislative Decree 206/2005 (Consumer Code) sets the minimum and maximum amounts of these penalties at between €5,000 and €5,000,000. The minimum rises to €50,000 if the advertising message puts the safety of children and adolescents at risk.
Where are we today?
The AGCM's moral suasion intervention had a largely satisfactory outcome, as influencers took on board the AGCM's recommendations and made more intensive use of warnings about the presence of advertising content in posts published on their social media profiles.
Furthermore, many companies are including specific clauses in endorsement contracts that provide influencers with specific guidelines on how to advertise products in compliance with industry regulations.
Nevertheless, during the course of this year, both the AGCM and the IAP Jury ruled against influencers and companiesthat carried out their promotional campaigns without taking into account the provisions of primary legislation and the AGCM's so-called soft law.
Source: Youmark
