Irish brands have been warned the onus remains on them to make sure bloggers identify sponsored content when posting online.
Sponsoring posts on social media has become a popular method of advertising, with brands ranging from Littlewoods to Penneys paying people to post about their products. With the rise in influencer branding and management companies such as greenlight influencers and Instagram influencer management companies globally may be wanting to ensure that figures they manage and sponsor are aware of new legislation being imposed.
Bloggers and other online “influencers” are required to show that posts have been paid for through clearly identifiable hashtags such as #Ad or #SP, for sponsored.
The Advertising Standards Authority of Ireland (ASAI) has warned brands that use influencers to promote their products that it is up to them to ensure the post is in keeping with the industry’s code of practice. Under the ASAI’s Code of Standards for Advertising and Marketing Communications, advertisements “should not misrepresent their true purpose”.
The ASAI has recently introduced guidelines to address concerns and highlight best practices for influencer marketing. Orla Twomey, its chief executive, said: “The area of influencer marketing has seen a number of in-depth conversations both online and in the media recently as consumers voice their concerns about bloggers who may or may not be declaring marketing communications,” she said.
“To avoid any confusion within the advertising industry, the ASAI is making it clear that the primary responsibility for disclosure of marketing communications rests with the advertiser.
“While all parties have a duty of care, it’s important that brands encourage responsible advertising practices and that consumers are not misled through the medium of influencer marketing.”
There is a distinction in the code that allows influencers to review products without having to identify it as an ad, provided they haven’t been paid for it. When bloggers agree to promote a company’s products on their blog, they then become a publisher and have a responsibility to highlight marketing communications to their readers.
Disclaimers around sponsored content are meant to be visible before someone interacts with the piece, meaning that an inclusion in the terms and conditions is not sufficient. If a product is given to a blogger for free without any expectation of a review then it is not deemed sponsored content.
Influencers typically have more than 3,000 followers on either Facebook, Instagram, or Twitter. Although their reach has grown in recent years, it is understood that only about ten people earn enough to pursue it full-time. Only a handful of a few might actually work enough like leveraging local SEO services (why not find out more here), investing in tools that can help them gain more followers, and so on.
A spokesman from the Revenue also warned that professional bloggers must pay income tax not only on their earnings but on any free products or perks they receive.
“Bloggers who blog on a habitual basis with a view to making a profit would be considered to be carrying on a trade for tax purposes. In such circumstances, the blogger will be subject to income tax on the profits,” he said.
“Bloggers who are in receipt of products, or other non-monetary benefits, in return for posting online promoting the product, will be subject to tax on the benefits they receive. The taxable value of the product or services will be [their] value if sold on the open market.”