Julie Zerbo, editor in chief of legal site The Fashion Law, says that a large number of influencers who received an FTC warning letter are still violating its advertising guidelines. This includes people such as Emily Ratajkowski, the model-actress who just happened to be revealed as a OnePlus brand ambassador earlier today, during the company's launch of its latest smartphone, the OnePlus 5. Zerbo, who has been covering the lack of ad disclosures on social media since 2014, said she believes Instagram is introducing its new tool to avoid secondary liability in the future.
As we saw with the Fyre Festival, Instagram has become the platform of choice for many influencers who want to promote products, either their own or others from a third-party brand. Because of that, she said, "It's not a huge stretch that the FTC might take action against Instagram for providing a platform for such FTC Act violations, and/or failing to police the potentially illegal content of its users." On a broader scale, tackling misleading content seems to be an ongoing problem for Facebook, as shown by how slow the company tends to take down graphic material from its site or even ads promoting counterfeit goods. And even though you can't compare the livestreaming of murders, suicides and rapes to shady paid ads, at least Instagram is trying to change for the better.
Ultimately, though, the FTC needs to take tougher action if it wants to put an end to the issue at hand. As of this writing, the agency has yet to file a legal case against any individual, although it did settle charges with Lord & Taylor last year for deceiving consumers through sketchy advertorial and paid Instagram posts by 50 fashion influencers. There was no monetary fine, however, only an agreement to put a monitoring program in place for the brand.
This remains the highest-profile case to date related to the topic, despite clear evidence of new violations in situations like the Fyre Festival. And brands, too, are partially responsible for the rise of stealth shilling, since they should be doing their due diligence and educating their partners on how to properly disclose paid advertisements. Adidas, one of the companies who works with influencers for product activations on Instagram, did not respond to our request for comment.
"I am not terribly optimistic that Instagram's new feature will change [anything]," Zerbo said, "especially since the FTC has not officially penalized any influencers or brands by way of monetary fines." As such, she added, these social media celebrities will continue to view their actions as a nonissue. Still, we won't know if Instagram can reverse this problematic trend until its new transparency tools are fully implemented, so there's some hope. Until then, Instagram's 700 million users (and counting) will have to question if their favorite celebrity is really on Bumble or if it's just an ad.