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ACCC Goes After Dodgy Influencers, Often Paid For By Big Companies

The ACCC has moved to identify dodgy influencers who post questionable reviews of products and services, often paid for by major Companies who are paying people to brag about their marketplace offerings.

In a major initiative the Australian Competition and Consumer Commission has started a “sweep” of the Internet, looking for paid-for services influencers who, as one observer says, “heaps praise on questionable products.”

The Federal Government commission is looking for misleading testimonials and endorsements by social media influencers, many who are paid by Companies to spruik products.

It will also look at more than 100 influencers mentioned in more than 150 tip-offs from consumers who responded to the ACCC’s Facebook post asking for information.

Most of the tip-offs from members of the public were about influencers in beauty and lifestyle, as well as parenting and fashion, failing to disclose their affiliation with the product or company they are promoting.

“The number of tip-offs reflects the community concern about the ever-increasing number of manipulative marketing techniques on social media, designed to exploit or pressure consumers into purchasing goods or services,” ACCC Chair Gina Cass-Gottlieb says.

There is even Companies such as aininfluencer set up to spruik the hiring of influencers. We have no evidence that this Company has broken any laws or that the people they use to market their services or services they offer have broken any laws or mislead consumers.

“We want to thank the community for letting us know which influencers they believe might not be doing the right thing,” Ms Cass-Gottlieb saiys

“Already, we are hearing some law firms and industry bodies have informed their clients about the ACCC’s sweep, and reminded them of their advertising disclosure requirements,” Ms Cass-Gottlieb adds.

The sweep is being run over the coming weeks as part of the ACCC’s compliance and enforcement priorities for 2022/23, with the broad aim of identifying deceptive marketing practices across the digital economy.

As part of the sweep, the ACCC team is reviewing a range of social media platforms including Instagram, TikTok, Snapchat, YouTube and Facebook, and livestreaming service Twitch. The sweep is targeting sectors where influencer marketing is particularly widespread. including fashion, beauty and cosmetics, food and beverage, travel, health fitness and wellbeing, parenting, gaming, and technology.

In conducting the sweep, the ACCC is also considering the role of other parties such as advertisers, marketers, brands, and social media platforms in facilitating misconduct.

“With more Australians choosing to shop online, consumers often rely on reviews and testimonials when making purchases, but misleading endorsements can be very harmful,” Ms Cass-Gottlieb says.

“It is important social media influencers are clear if there are any commercial motivations behind their posts. This includes those posts that are incentivised and presented as impartial but are not. The ACCC will not hesitate to act where we see consumers are at risk of being misled or deceived by a testimonial, and there is potential for significant harm.

This action may include following up misconduct with compliance, education, and potential enforcement activities as appropriate.”

Many consumers are aware that influencers receive a financial benefit for promoting products and services. However, the ACCC remains concerned that influencers, advertisers, and brands try to hide this fact from consumers, which prevents them from making informed choices. This can particularly apply to micro influencers with smaller followings, as they can build and maintain a more seemingly authentic relationship with followers to add legitimacy to hidden advertising posts. The ACCC is therefore monitoring a mix of small and larger influencers in the sweep.

This sweep follows a similar initiative carried out in 2022, which focused on identifying misleading online reviews and testimonials posted on business’ websites, their social media pages and third-party review platforms. A report outlining the findings from 2022 will be published in the coming months.

“Online markets need to function well to support the modern economy. Part of that is ensuring consumers have the confidence they need to make more informed purchasing decisions,” Ms Cass-Gottlieb said.

The ACCC will publish the findings of this sweep once the results have been analyzed.



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