The national consumer watchdog has raised concern over the rise in misleading advertising claims by social media influencers.
Content creators are legally obliged to disclose sponsorship deals on their posts. However, a review by the Australian Competition and Consumer Commission (ACCC) found potential breaches across 81% of the accounts it surveyed.
It’s triggered new enforcement action from the ACCC to protect consumers.
What are the laws?
Australian consumer law prevents businesses from misleading or deceiving customers.
These laws can be breached when social media accounts fail to disclose paid posts or mislead audiences about the nature of their relationship with a brand.
Posts that are deemed too confusing or vague could also be in breach of the law, even if a creator has attempted to acknowledge a sponsorship or brand partnership.
The ACCC found many of the influencers it reviewed had made concerning posts under consumer law.
It said influencers posting about ‘fast fashion’ brands were the most likely to be misleading. These posts were often targeted at young audiences.
It also found several parenting influencers had posted content tagging or displaying household goods and children’s products without disclosing a potential sponsorship.
The key findings
The most common concern found by the ACCC was transparency in acknowledging commercial deals.
Many sponsorships were disclosed at the end of a lengthy caption or video, or in hard-to-read font or graphics.
While many influencers tagged or thanked brands in their posts, the ACCC said they risked deceiving their followers into believing paid endorsements were entirely genuine or unpaid.
The ACCC was also concerned about the vagueness of terms like ‘spon’ rather than ‘sponsored’, and influencers referring to themselves as brand ambassadors or collaborators.
It argued these terms do not clarify or confirm an influencer’s relationship with a brand.
A small number of accounts were found to have made false claims about the nature of a brand deal. This included some influencers claiming they had purchased an item, when it may have been gifted to them.
The ACCC will release updated advertising guidelines for content creators, brands and advertisers next year.
It’s aimed at reminding social media influencers of their obligations to uphold consumer laws, specifically in disclosing commercial relationships on social media posts.
The ACCC said it will also work to spread awareness to inform consumers about influencer marketing practices on social media.