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Home / Business

Sasha Borissenko: The legal loopholes in influencer marketing law

By Sasha Borissenko
NZ Herald·
12 Jul, 2020 03:00 AM6 mins to read

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Simone Anderson rose to fame when she documented a four-year weight loss journey including gastric sleeve surgery, removal of excess skin, a butt lift and breast enhancement. Video / NZ Herald
Opinion

COMMENT:

The world of Instagram and the rise of the influencer - or "influenzas" as a dear friend calls them - baffles me.

On the one hand, influencers represent everything that is good about capitalism - accessibility, mobility, and democracy.

On the other hand, it is marketing at its most cunning and insidious. And there are few legal safeguards that ensure influencers produce responsible content, or produce content responsibly. Influencers are now under the microscope - as evidenced by the landmark decision by the Advertising Standards Authority (ASA) against Simone Anderson.

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A bit of context: Simone Anderson, with 314,000 followers, shot to fame after documenting her weight-loss journey. She is a published author, motivational speaker, MC, and she has got her own activewear line (exercise gear that is traditionally worn outside the gym). Her posts feature clothing, promotional appearances, her partner Trent, her dog Maddox, her gym and cooking routines, and makeup tutorials. During alert level 4 she took the country by storm after providing a plethora of cleaning life-hacks. I personally have never cleaned a skirting board or individual blinds in my life, but I was inspired to blitz my mother's garage.

Essentially the Complaints Board upheld four complaints relating to Instagram posts (pictures), saying they met the definition of "advertisement" and Anderson failed to disclose that information, which misled audiences.

The first "post" showed Anderson wearing activewear on a beach. The description read: "Our little stroll this morning was so gusty!! Crop and tights @aimn.ocearnia (a company) "Simone10". The issue was that she did not make clear there was a commercial relationship with the company that was being promoted. In response, Anderson amended the post to include the hashtag #Gifted, and explained the "Simone10" was an affiliate discount code, meaning she would get 5 per cent of sales.

What's an advertisement?

The ASA definition of advertisement requires a message to be directly or indirectly controlled by the advertiser. Who is the advertiser, though? The issue is that the more "authentic" a photograph appears (this is called "organic content") the more successful it will be. The aim of the game is for viewers to subliminally consume the advertising - compare, say, product placement of people smoking or people drinking alcohol in movies, for example. So companies are incentivised to distance themselves from controlling the relationship, while also having a vested interest in watering down disclosures.

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Simone's Second Hand Wardrobe continues to operate but the influencer made it unsearchable on Facebook after the Herald revealed the site was being investigated in June. Photo / Supplied
Simone's Second Hand Wardrobe continues to operate but the influencer made it unsearchable on Facebook after the Herald revealed the site was being investigated in June. Photo / Supplied

Arguably, Anderson was a scapegoat, or agent, as the company in question could distance themselves from the "control" requirement. The ASA doesn't have a mandate to issue fines or penalties. Anderson simply had to remove or amend the post, but then there's the reputational damage of being highlighted in the media. Why might the public respond in a vitriolic manner? I'm a huge fan of goodie bags, and gifts, so there's a sense of envy, I suppose.

Where to from here?

There have been calls to improve the identification of advertisements - the ASA released a Guidance Note in 2018, for example. The issue relates to imbalance of power between brands and influencers, and education, one submitter wrote in response to the note.

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"There is nothing wrong with someone talented working in paid partnership with a brand they love. I believe that if the stigma around this was openly addressed, it would help encourage local influencers to actively disclose or stand up to PR agencies who exert pressure.

"Education is key to avoiding misdemeanours of greater scale in the future, which could lead to major consequences, especially for the creative talent involved."

Is NZ behind the times?

The UK has cracked down on the industry that is projected to worth US$15 billion by 2022.

In January last year, the Competition and Markets Authority (together with the UK Advertising Standards Authority) published new regulations and guidelines, which required influencers to disclose when they've been paid, gifted, or loaned; be clear about their relationship with brands; to disclose in an honest, transparent, unambiguous, and easy-to-understand manner; to be upfront; and not to mislead.

The guidelines also specify what constitutes brand control.

Unlike NZ, the UK ASA can impose sanctions. Excessive breaches could lead to fines, imprisonment, and confiscation of financial assets.

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NZ ASA cases are 'purrrfect'

The self-regulatory organisation of the advertising industry provides a free complaints process for consumers about the content and placement of advertisements. After a deep dip into its 2020 decisions, I can conclude that the complaints are incredible.

Complaint 20/017 against Griffins concerned a television advertisement that showed a girl in a cardboard box using her imagination to pretend it was a racing car. Two complainants were concerned the advertisement was irresponsible because it encouraged children to participate in unsafe activity. The decision was not upheld.

More on the issue of safety, complaint 20/009 concerned a Keri Juice television ad, which showed children preparing breakfast in bed for their parents. The complainant said the ad was unsafe because it showed young children using a knife to get toast out of a toaster, and using a stove when they could not reach the bench. The decision was not upheld.

I shall leave you with complaint 20/012 against Nestle. The ad for Purina ONE cat food showed an abandoned kitten being cared for by the SPCA. The kitten's condition improved as a result of having a better diet. The SPCA employee held the cat up to her face and kissed the kitten's head. The complainant argued the ad showed a dangerous practice of kissing cats, which could spread diseases. The ASA chair found no grounds to proceed.

• If you've got any tips, legal tidbits, or appointments that might be of interest, please email Sasha - on sasha.borissenko@gmail.com

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