Influencer Marketing: How to Avoid Falling into “Hidden” Advertising?

Influencer marketing is at the heart of today’s corporate communication strategies. It is defined as a communication strategy targeting a specific audience within the community of an influential person on the web, called an influencer. The digital media used by influencers are primarily blogs or social networks, such as Instagram or Twitter. This approach has become widespread in recent years, thanks to the rise of social networks. As a result, influencer marketing has become an essential communication lever for brands.

A brand can freely use influencer marketing, a principle that stems from the freedom of trade and industry. However, influence is a concept with legally blurred boundaries due to its very recent and innovative emergence. It borders on more regulated sectors such as advertising. How to Implement Influencer Marketing Without Falling into “Hidden” Advertising?

What Are the Challenges of Influencer Marketing?

This strategy supports brands in their communication campaigns with the objectives of increasing their audience and visibility, and ultimately, sales.

What Is the Legal Qualification of Influencer Marketing?

Defining the boundaries of influence is difficult, it lies at the intersection of advertising, information, and communication, which have been strictly legally defined.

Information?

Information can be defined as the act of informing an individual or group of people about a subject. Traditionally, the press has been the medium for mass dissemination of information. Due to the growth of new technologies, the Internet has emerged as the new preferred medium, particularly social networks such as YouTube or Instagram.

Communication?

Communication refers to all interactions with others that allow the transmission of information or the establishment of a connection via a communication medium.

Advertising?

Advertising, or commonly called “ad “vertising,” refers to a set of attractive means aimed at promoting a brand and encouraging consumers to buy its products or services. “Its reason for being is exclusively commercial” according to th” e study on advertising and the French by the Professional Advertising Regulatory Authority (ARPP), the Institute for Advertising Research and Studies (IREP), and the French international marketing opinion polling company called IPSOS. Legally, judges define advertising as a “means of information intended to allow potential customers to form an opinion on the characteristics of goods or services offered to them” (Cass. com., May 6, 2008 n°04-19.713). It can be protected by freedom of expression while respecting internal and European standards.

However, it comes with ethical imperatives as well as legislative and regulatory standards. The advertising message cannot disregard certain limits . It is therefore essential to know the obligations of influencer marketing actors.

In summary, influencer marketing can be legally qualified as communication or advertising depending on its identification.

How to Identify the Advertising Nature of Influencer Marketing Content?

What Are the Identification Criteria?

According to the Digital Advertising Communication Recommendation of the ARPP, the content will be qualified as advertising if three criteria are met:

• The influencer shares content in favor of a brand or product in exchange for remuneration or compensation. These are reciprocal commitments;

• The brand or its representatives must have predominant editorial control of the content and must validate it before publication;

• The influencer has an obligation to publish content with the purpose of promoting a product or service. This can take the form of a verbal presentation, a promotional speech, a visual with promotional intent…

Thus, these criteria are assessed on a case-by-case basis by judges. As an illustration, the Court of Cassation has ruled that a message relayed by an internet user to their network of Facebook friends will be classified as advertising (Cass. 1re civ., July 3, 2013, n°12-22.633).

What behavior should be adopted?

In case of advertising identification, it must be identified as such using phrases like “”in partnership with, “”#sponsored by, “”advertisement… The “#Ads” or “#Pub” is not sufficient. The message must be visible and/or audible, clear and understandable by all, regardless of the media used. For example, if it’s a YouTube video, the brand must identify the advertising nature in the video itself. Furthermore, its identification must be instantaneous according to Article 9 of the International Chamber of Commerce Code. In this sense, the internet user should not have to click or redirect to another page to know its advertising nature or not. Depending on its advertising nature or not, companies will have to adopt certain measures to respect the obligations in this regard.

What does the law say?

The legislator imposes legal standards on influencer marketing actors to ensure transparency and loyalty of content:

• The law of July 3, 2008 for confidence in the digital economy requires brands to make accessible via a public communication service, all advertisements clearly identified as such;

• Online platform operators must clearly display “information about whether their ranking has been influenced by the existence of a contractual relationship, a capital link or remuneration” between the brand and the influencer (Article D.111-7-I of the Consumer Code);

• A commercial practice is classified as misleading if the professional uses it to omit, conceal or provide in an unintelligible or ambiguous manner its true commercial intent (Article L.121-3 of the Consumer Code);

• Article L.121-4 of the Consumer Code provides an exhaustive list of behaviors qualified as misleading commercial practices such as that provided in paragraph 11: using editorial content in the media to promote a product or service when the professional has financed the promotion without clearly indicating this in the content or by images or sounds clearly identifiable by the consumer. According to Emmanuel Durieux, professor of media law, fall under media all activities which, by means of writing, speech, image, sound or any other form of signs, contribute, by any vector or support whatsoever, to making public facts, data, ideas, knowledge, feelings, opinions…

Thus, to implement loyal and transparent influencer marketing, each advertising message must be identified as such, readable, intelligible and must not be likely to mislead the consumer. Otherwise, it could be considered as “hidden advertising”.

What are the consequences of violating influencer marketing rules?

What are the sanctions?

The legal arsenal punishes misleading advertising as well as unfair competition.

➝ Misleading advertising

• For misleading commercial practices defined in Articles L. 121-2 to L.121-4 of the Consumer Code, the judge can impose financial sanctions and imprisonment. These practices are punishable by two years of imprisonment and a fine of 300,000 euros and even, increased up to 10% of the average annual turnover or 50% of the expenses incurred for the realization of the advertising or practice constituting this offense (Article 132-2 of the Consumer Code);

• In addition, the judge may order the publication of the judgment in question on the website of the convicted brand for a specified period. In practice, this affects consumer confidence in the brand, thereby diminishing its reputation and potentially impacting sales.

➝ Unfair Competition

• A company using deceptive commercial practices such as misleading advertising may be penalized on the grounds of unfair competition (Cass. Com. February 12, 2020, No. 17-31.614 ). Indeed, by disregarding current regulations, a brand unfairly obtains a competitive advantage, the effects of which can impact both competition and consumers;

• The judge may order the payment of damages in an amount sovereignly assessed based on the economic loss suffered by an injured party, under extra-contractual liability on the basis of Articles 1240 and 1241 of the Civil Code. This economic loss generally corresponds to the loss of earnings or loss incurred by the latter;

• The judge may also award damages to compensate for moral prejudice such as damage to the brand’s reputation or the company’s image;

• Finally, the judge may order the publication of the judgment as previously stated.

Who Monitors Non-Compliance with the Rules?

In the field of influencer marketing, several actors will be responsible for monitoring these contents. These are mainly judges, the Directorate General for Competition, Consumer Affairs and Fraud Control (DGCCRF), the ARPP (Professional Advertising Regulatory Authority), and the Advertising Ethics Jury (JDP). Since 2015, YouTubers have been in the crosshairs of the DGCCRF due to hidden advertising.

Influencer Marketing: Legal Best Practices

Influencer marketing is based on Data marketing and the authenticity of user reviews.

Authenticity refers to accuracy, a fact whose origin is undoubted and of total sincerity. However, one may wonder if a marketing campaign based on sponsored influence can be qualified as authentic when the brand pays the influencer to promote its content… Thus, it is preferable not to sponsor influencers’ reviews in order to preserve an authentic image of your brand. It is advised to use tools that collect reviews from consumers and micro / nano influencers. The latter have a high engagement rate, unlike most macro influencers who have a high reach, thanks to a number of followers or subscribers exceeding several million, but they have a much lower engagement rate.

It is advised to follow the recommendations and opinions of the “ARPP, the JDP, the Advertising Joint Council (CPP) or the” Advertising Ethics Council (CEP), these are the best practice guides for brands to follow.

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