Blurred Lines: Inside the Rise—and Failure—of Influencer Marketing

It was January 27, 1987, and the New York Giants were a minute away from winning the Super Bowl. Phil Simms, the team’s quarterback and soon-to-be Super Bowl MVP, got a tap on his shoulder.

Simms was instructed to repeat “I’m going to Disney World!” and “I’m going to Disneyland!” three times each during the post-game interview, according to a 2014 USA Today article. Soon after, the game ended, reporters rushed the field, and Simms unknowingly became part of marketing history.

A day later, Disney ran a commercial that opens with highlights of the game set to the famous Pinocchio theme song “When You Wish Upon a Star.” Then the ad cuts to Phil Simms at midfield, post-victory. When an announcer asks him what he’s going to do after winning the Super Bowl, Simms responds, “I’m gonna go to Disney World!” The clip ends with fireworks exploding over Cinderella Castle.

To the average viewer, the magical moment seems organic, as if Disney quickly threw together a commercial to take advantage of Simms’s “spontaneous” announcement. Now, it’s tradition for Super Bowl MVPs to yell that they’re “going to Disney World!” But not many people know that Simms’s goofy grin was as much out of discomfort as it was out of ecstasy.

“Of course I’m smiling because we won, and the other reason is because I can’t believe I’m doing this,” he told USA Today.

Days later, word came out that the moment was actually sponsored. Disney paid Simms $75,000 and a family trip to Disney World for the commercial. John Elway, the Denver Broncos quarterback, was also offered $75,000 to say the line if his team had won the Super Bowl.

In retrospect, the endorsement deal seems obvious—why would Simms suddenly announce he was going to Disney World? But it’s also telling that Disney avoided disclosing the transactional nature of the moment. If Simms had divulged that he was being paid to make the statement, the magic would’ve been lost.

Under the influence

Disney’s Super Bowl plug became a precursor to a now-ubiquitous marketing practice: influencer marketing. In the past, influencers were traditionally celebrities like Simms. But in the Internet era, social media has made influencer marketing a scalable endeavor. Rather than paying expensive celebrities to reach a broad audience, brands can team with niche bloggers, Instagram stars, and YouTubers to market their products.

With it’s massive growth, proliferation on difficult-to-control social media platforms, and the oftentimes contradictory language from influencer marketers themselves, influencer marketing has become something of a wild west—something that, if influencers and marketers aren’t careful, could end up hurting the longterm prospects of the industry as a whole.

This video from marniethedog, who has 1.9 million Instagram followers, is a paid advertisement for Subaru, but that isn’t entirely clear from the description. Subaru’s Instagram is tagged, and the hashtag #collab is included, but does the user know the dog’s owner was paid to create the post?

https://www.instagram.com/p/BBf3vQfvA2V/

For another example, take this YouTube video from the popular influencer couple Tiff & Case that was sponsored by Nissan. The video’s written description vaguely hints at the partnership with wording like “collaborate with,” and there’s no disclosure at all in the video or the title. Instead, Tiff opens the clip by saying, “I really like this car… It’s like so, I dunno, I just feel good in it. And I like how it drives too.” Later on, they awkwardly announce the full model name (2016 Nissan Ultima 3.5SL), use the branded hashtag #sonotmeh, and Tiff even claims it was her “dream car” growing up. Subtle this is not.

The practice is another form of native advertising, except it relies on social media influencers rather than in-house advertorial. Native advertising on publisher sites has come under fire for sometimes deceiving and confusing readers. Our 2015 study, showed that 48 percent of respondents felt deceived by native advertising.

So far, influencer marketing has escaped much of the same criticism.

In December, the FTC finally released an updated version of guidelines for native advertising, asking publishers to include a variation of “Ad,” “Advertisement,” “Paid Advertisement,” or “Sponsored Advertising Content” in the beginning of an article or video. Most framed the guidelines as an attempt to reign in native advertising on digital publications. (The FTC’s use of “native advertising” as an umbrella term for any sort of promotional material that’s not a traditional ad probably didn’t help.)

In a Digiday article, Todd Krizelman, co-founder and CEO of MediaRadar, an ad data firm, estimated that only 30 percent of publishers were in compliance with the rules and that 26 percent do not disclose at all.

But few considered the ramifications of the new guidelines on influencer marketing, which is subject to the same rules.

“They are looking for very explicit call-outs,” Krizelman told me. “They want to see the words ‘This is an ad’ or ‘Paid advertisement.’ They do not want to see things like, ‘Presented by.’ Today, if Kim Kardashian is posting [an ad], she may just post it. No one would know if she was paid or not paid.”

On March 15, the FTC settled its first complaint since the new changes, with clothing retailer Lord & Taylor. The enforcement targeted a native ad published on the fashion site Nylon, but also took aim at a 50-person influencer marketing campaign that featured various social media stars modeling a sundress. According to the ruling, “None of the Instagram posts… included a disclosure that the influencer had received the dress for free, that she had been compensated for the post, or that the post was a part of a Lord & Taylor advertising campaign.”

“The FTC and other regulatory authorities are very concerned about influencer and native advertising,” said Andrew Lustigman, an attorney at Olshan Frome Wolosky who specializes in advertising and marketing. “Because the message is now coming from a third party, regulators want to make sure that consumers know that there is business relationship between the parties so that they can evaluate the message with that in mind.”

Unfortunately, this is anything but standard practice.

Blurring the lines of influencer marketing

When you browse influencer marketing best practices, “trust” and “authenticity,” are two words that constantly appear. A February 2016 study by eMarketer suggested that influencer marketing has become more popular, in part, because of young people’s trust in social media stars, who they tend to see as more authentic than a brand or an advertisement.

“The key word that I’m coming back to in everything I talk about with influencers is authenticity,” said Todd Cameron, head of content and strategy at influencer marketing software company TapInfluence.

At the same time, marketers regularly mention the need to maintain an “organic” and “natural” feel to their influencer campaigns.

“The idea was to make an ad that looks like word of mouth from a fellow user,” said Zach Lilley, co-creator of the formerly popular Tumblr page So-Relatable, in a New Republic piece on a short-lived and eventually banned influencer marketing network on Tumblr. “If it’s presented to you in a way that she’s your peer, she’s a similar person to you, you don’t even know her in the same way, but it feels different. It’s like it seems more genuine.”

Some even explicitly try to obscure the advertorial nature of influencer marketing, like in this introductory blog post from The Shelf, an influencer marketing platform: “When done well, this type of marketing won’t even look like marketing… most of the time, people don’t even realize they’re looking at it.”

“When a brand activates an influencer solely based on follower count, you can run into a scenario where their content feels like a paid ad, which defeats the entire purpose of influencer marketing,” said Brittany Hennessy, the associate director of social strategy & influence at Horizon Media. She also noted that her firm doesn’t work with influencers known to skirt FTC regulations.

In other words, some influencer marketers are asking the impossible: influencers should clearly disclose when they are being paid, but those ads shouldn’t feel like ads. That’s an incredibly fine line to walk. And when marketers have to choose between transparency and authenticity, transparency often loses out.

Dealing with disclosure

Coded language is only part of the problem. Due to technical limitations on social platforms like character counts, influencers may struggle to accurately disclose their sponsorships. In some cases, these endorsers may not even understand how to properly disclose.

For example, social influencers have to put their disclosures at the bottom of a video or photo on Instagram due to the layout of the posts, which is technically against the new regulations:

Under FTC law, advertisers cannot use “deceptive door openers” to induce consumers to view advertising content. Thus, advertisers are responsible for ensuring that native ads are identifiable as advertising before consumers arrive at the main advertising page.

Instagram stars also regularly post ads without proper disclosure, whether they realize it not. The common rule is to tag the brand, thank them, or, at the very best, include an #ad hashtag at the end of the post (only the #ad follows FTC regulations, but even then the sponsorship can be subtle).

Lifestyle, fashion, and travel influencers in particular—such as caraloren, who has 606,000 followers, or iamgallah, who has 1.7 million—commonly tag brands like UGG or Huawei without any sort of disclosure (note that these posts went live after the December rules).

https://www.instagram.com/p/BBpsK6UG38B/

https://www.instagram.com/p/BDwmpgaMvZB/

In both of these posts, the influencers model the sponsored product, but there is no explicit indication in either the image or the text that the post is an ad.

On YouTube, personalities who discuss consumer products are common targets for influencer marketers. But some, like tech reviewer Austin Evans, intersperse unpaid reviews with paid ones, which can be difficult to tell apart.

A video in which Evans gives a “first look” at Microsoft’s latest Surface Pro is an excellent example. Microsoft sponsors the clip, but Evans neglects to mention any sponsorship and only gives positive feedback on the product. The disclosure in the description—”I recently teamed up with Microsoft”—is confusing at best. As a result, the video undermines the cachet of both Evans and Microsoft.

Snapchat, another growing influencer platform, is practically unregulatable because of the temporary nature of the content. Shaun McBride, a Snapchat star who works with several brands, believes that disclosures—which are few and far between on the platform—would ruin the platform’s effectiveness: “I like how it is right now, and I dislike that when you post on Instagram you have to put #ad,” he told the Verge last summer. “It kind of takes away from the vibe.”

A coming intervention?

Unlike publishers that have to uphold journalistic integrity and worry about greater media scrutiny, social media influencers seem to have found greater leeway when it comes to testing the boundaries of ethical advertisement.

But that doesn’t mean that the industry will stay blind to the issues forever. Plenty of influencer marketers want to comply with best practices and understand the potential long-term consequences of deceiving audiences and hurting the reputations of influencers.

It’s also important to note that many influencers do a good job of properly labeling their native ads. As Cameron said, “Some verticals are really good about disclosing everything… Some verticals aren’t as—they just interpret the guidelines differently.”

One of the best examples I could find was an ad for the 2015 Point Break reboot created by popular YouTuber DevinSuperTramp. The video clearly states “sponsored by” in the description and even includes the product’s name in the video’s thumbnail and title. Additionally, it’s a well-made video that uses the influencer’s talents and ties into the product without obscuring the sponsorship.

Trustworthy influencer marketing is only possible when social influencers disclose, boldly and proudly, that what they’re doing is a paid advertisement. If the brand or the influencer try to hide this fact, they risk undermining consumer trust for both parties.

Even if influencers and marketers continue to deceive consumers, there’s little doubt that more regulation—and better clarified regulation—from the FTC is coming.

Lustigman, for one, is confident that the industry can still survive and thrive. “I do think that the industry will adapt,” he said, “and those who embrace their obligations will ultimately succeed.”