Jennifer Lopez posted a photo of herself against the backdrop of vodka bottles, thanking the Beluga brand in an Instagram caption that recalled her “birthday weekend in Vegas!!”
Nicole Polizzi, the “Jersey Shore” star better known as Snooki, flexed her left bicep and held up a pack of Flat Tummy Tea in her right hand, declaring in the caption of her Instagram photo that “There’s just NO WAY I’m doing summer without a flat tummy.”
Allen Iverson, the former basketball star, stoically held up a package containing a new IO Moonwalkers hoverboard, punctuating his thank you to the company with “#TheAnswer,” his nickname from his days playing for the Philadelphia 76ers.
They, along with the likes of Lindsay Lohan and Heidi Klum, were just a few of the celebrities who recently received letters from the Federal Trade Commission as part of the regulatory agency’s campaign to promote clearer disclosures of endorsement deals. The agency did not reveal the identities of the celebrities when it announced last month that it had sent the letters.
The letters, which the NLJ obtained Thursday through a Freedom of Information Act request, were sent not only to celebrities but also to well-known brands such as Adidas in the FTC’s push to police “influencer” marketing campaigns. Advertisers in these campaigns pay for product endorsements from people with large social media followings.
Such campaigns have taken off with the rise of social media and ad-blocking software that has forced advertisers to find new ways of reaching consumers. As The New Yorker recently reported, one study has projected the social media influencer market will grow to at least $5 billion by 2020.
The FTC has taken notice. The agency has shown concern about social media posts that do not adequately disclose the business relationship between the influencer and the brand. To date, the FTC has put the burden on the brands themselves to ensure appropriate disclosures.
Last year, for instance, the FTC reached a settlement with Warner Bros. Home Entertainment Inc., represented by the law firm Venable, over a lack of disclosures for paid promotions of the video game “Middle-earth: Shadow of Mordor.” But the agency did not go after the likes of the popular YouTube personality “PewDiePie” and other influencers who were paid for positive videos and social media posts about the game.
The FTC’s mass mailing of more than 90 letters marked the first time the agency directly contacted influencers to provide guidance on proper disclosure, signaling a deeper appreciation of their role in the advertising campaigns. The FTC said the letters were “informed by petitions filed by Public Citizen and affiliated organizations regarding influencer advertising on Instagram,” along with the agency’s own reviews of social media posts.
“Consumers have a right to know when they’re being advertised to. We’re living now in a time when everybody from the most well-known celebrity to our closest friends and family members are sharing the smallest details of their lives,” Kristen Strader, a Public Citizen campaign coordinator, said Thursday. “Because of that, it can be really hard to tell when someone’s been paid to endorse a product or is sharing just a moment from their lives. And that’s why advertisers are using influencer marketing. So we are very much concerned about consumers knowing when they’re being advertised to.”
In a press release announcing the letters, the FTC said its “staff did not predetermine in every instance whether the brand mention was in fact sponsored, as opposed to an organic mention.” The FTC did not refer to the letters as warnings, instead framing the messages as reminders to influencers and marketers of their disclosure obligations.
“It seems like, without any consequence, these marketers and influencers have no reason to take these letters seriously and change what they’re doing,” Strader said. “That’s the biggest concern we have.”
A spokesman for the FTC declined to comment.
Some of the letters did point out disclosures that the FTC found insufficient, asserting that many consumers would not understand that language such as “#sp,” “thank you” and “#partner” signified that an Instagram post was sponsored.
In Lopez’s case, the FTC specifically noted the portion of the Instagram caption in which the singer and actress wrote, “Thanks again @vodkabeluga.”
That phrasing, the FTC wrote, “is probably inadequate to inform consumers of a material connection because it does not sufficiently explain the nature of your relationship to the company; consumers could understand a ‘thank you’ simply to mean that you are a satisfied customer.”
The FTC’s letter about Lopez’s post was addressed to Ryan Nord, a lawyer at the Los Angeles-based firm Hirsch Wallerstein Hayum Matlof + Fishman. Nord was not immediately reached for comment.
Representatives for Iverson and Polizzi were not reached for comment Thursday afternoon.
The letters directed influencers and marketers to review an FTC guidance document, published in 2015, that calls for “clearly and conspicuously” disclosing brand relationships. While it does not mandate specific wording, the guidance gives ideas and tries to accommodate word limits such as Twitter’s 140-character cap on individual tweets.
“Starting a tweet with “Ad:” or “#ad”—which takes only 3 characters—would likely be effective,” the FTC guide states.