New Regulations on Endorsements made by Social Media Influencers!
#8 Social media influencers endorsing products online now come under the purview of Consumer Protection Act!
The Department of Consumer Affairs released a new document that sets out guidelines for Celebrities, Influencers and Virtual Influencers endorsing products and services on social media platforms. Given its length and nature, the document may seem really straightforward, however it is a bit vague when it comes to explaining some terms. While it remains to be seen how these would be enforced, for now let’s break down how these new guidelines would work..
Who does this new regulation apply to?
The regulations apply to celebrities and influencers. Basically, any person or group on social media who has a considerable following and is able to make others buy products or services or change their opinions about these products and services by their endorsements.
It is interesting to note that the guidelines do not determine a quantitative threshold of who qualifies as an influencer, but rather on their ability to influence the decision making of their audience.
It specifically lists down three categories that are covered under this regulation:
Celebrities: Famous personalities from the entertainment, sports and such other industries, who have power to affect the decision or opinion of their audience.
Influencers: Creators who advertise products and services with a strong influence on the purchasing decisions or opinions of their audience.
Virtual Influencers: Fictional computer generated ‘people’ or avatars who have realistic characteristics, features and personalities of humans, and behave in a similar manner as influencers.
When should a disclosure about an endorsement be made?
The disclosure must be made when there is a material connection between the advertiser and the influencer that may affect the weight or credibility of the representation made by the influencer.
Material connection could be as follows:
Monetary compensation
Free products with or without any conditions attached, including those received unsolicited, discounts, gifts
Contest and sweepstakes entries
Trips and hotel stays
Media barters
Coverage and awards
Any family, personal or employment relationship
How should the disclosure be made?
The disclosure must be in simple and clear language. On platforms where limited space is available to post, like Twitter, contractions are acceptable. For example, XYZAmbassador is acceptable where XYZ is a brand.
Terms such as ‘advertisement’, ‘ad’, ‘sponsored’, ‘paid promotion’, ‘paid’ may be used.
Disclosures and endorsements must be made in the same language.
Separate disclosures must be made apart from platform disclosure tools. For example, if you have used Instagram’s ‘paid promotion’ option, you must also make the disclosure in your description and post.
Placement of the disclosure
The disclosures should be placed in the endorsement message in a manner that is clear, prominent and extremely hard to miss. It cannot be mixed with a group of hashtags or links.
If you are posting a photo, the disclosure should be superimposed over the image, enough for viewers to notice.
If you are posting a video, the disclosure should be placed in the video and not just in the description. Along with placing in the video, the audio must also clearly state that this is an endorsement post.
If you are posting a live stream, the disclosure should be displayed continuously and prominently during the entire stream.
Due Diligence by Celebrities and Influencers
Celebrities and influencers should review and satisfy themselves on the products and services to substantiate their claims before endorsing. They are also recommended to use and experience the product or service themselves before endorsing.
Punishments for not disclosing endorsements
As a celebrity or influencer if you fail to disclose any material connection between you and the advertiser on your social media post endorsing a product, you can be charged for publishing ‘misleading advertisements’ under the Consumer Protection Act.
The punishment for misleading advertisements in India can vary depending on the circumstances of the case and the severity of the deception. The punishment can include fines, penalties and even in certain cases, imprisonment.
The advertising industry is regulated by the Advertising Standards Council of India and the Ministry of Consumer Addairs, Food and Public Division. These organisations have the power to take action against misleading advertisements, including issuing warnings and taking legal action against companies and individuals who violated advertising guidelines.
If you are an influencer, it is advisable you read the Guidelines For Prevention of Misleading Advertisements and Endorsements for Misleading Advertisements, 2022.
Comment below and let me know what you think of these guidelines. Also, if you know a social media influencer who needs to know about these guidelines, share this post with them! :)
Until next time!
Yours,
KB