Authors

Ashley Luong

All That Glitters is Gold: The Regulation of Hidden Advertisements and Undisclosed Sponsorships in the World of Beauty Social Media Influencers

Abstract

What happens when a trusted acquaintance is caught lying? What if these lies have influenced your purchasing decisions? In the realm of social media influencers, the line between authentic opinions and sponsored advertisements is a blurred one. Influencers have considerable marketing power over millions of followers and their brand of authenticity makes them a desirable partner to big corporations seeking to promote their products. Under current FTC regulations, the simplified rule for advertisement disclosure is to make the disclosure “clear and conspicuous” with very little guidance beyond that phrase. Influencers are uncertain how to disclose, some choosing to toe the grey areas by hiding disclosures in a mass of text or discreet areas, and brands cast a blind eye to violations. The FTC’s lack of advertisement regulation and enforcement action against social media influencers, who expose consumers to hidden advertisements, enables unfair business practices. Brands savvy enough to utilize these unregulated influencers are able to sell their products to an audience who trust influencers because of their “authenticity.”

This Note proposes a revamp of the current regulations to mirror the FTC’s German counterpart, the Landesmedienanstalten, with minor adjustments, to clearly guide influencers on how to disclose their hidden advertisements in a manner that is truly clear and conspicuous to consumers. Further, this Note suggests increasing penalties for influencers violating the regulations through enforcement actions, and promoting collaborative efforts with social media platforms to provide tools to properly disclose endorsements in addition to collaborative efforts with brands to notify influencers of the FTC regulations for endorsements.

Repository Citation

Ashley Luong, All That Glitters is Gold: The Regulation of Hidden Advertisements and Undisclosed Sponsorships in the World of Beauty Social Media Influencers, 11 Wm. & Mary Bus. L. Rev. 565 (2020), https://scholarship.law.wm.edu/wmblr/vol11/iss2/7