Though influencer marketing has increasingly matured in recent years, the challenge around transparent advertising disclosure persists. A new study from Awin shows influencers aren’t using clear and upfront ad disclosure labels, which is their responsibility to protect consumers from deceptive ads, as outlined by the Federal Trade Commission (FTC).
Awin analyzed over 20 million posts on Instagram to determine if one of the approved disclosure hashtags—#ad, #sponsored, #affiliate and #gifted—was visible in the original post or was hidden by the platform’s expanding text feature.
Awin found that 76 percent of Instagram influencers are burying hashtag ad disclosures within their caption. Over half (59 percent) put the ad disclosure midway through a post or caption while 24 percent only included it at the end. Worse, 12 percent put the disclosure in the comments section of a post, which, depending on the number of comments a post receives, could get buried deep in the thread.
Only five percent of posts Awin analyzed included the disclosure label at the beginning of a post, which violates the Advertising Standards Association’s (ASA) rules stating that ad labels must be prominent enough that users will easily notice it. Burying or placing the label under the caption’s fold isn’t sufficient, according to the ASA.
Awin also found that certain hashtags were more hidden than others, #affiliate being the most obscure. Another 60 percent of influencers hid the phrase #gifted.
In addition to hiding the ad label, many influencers even obscured the name of the brand that paid for the post, according to Awin. Just 13 percent of the analyzed posts referred to a paid collaboration or partnership with a brand. Among those that used the hashtags #ad and #sponsored, only 24 percent and 23 percent referred to the brand in question, respectively.
The online ad market on Instagram is expected to reach more than $2.5 billion this year and the number of US Instagram shoppers that use the platform for social commerce purchases will rise to 30 percent next year. Brands that pay influencers are responsible for informing them of guidelines around transparent advertising relationships, according to the FTC. This makes it critical for brands and influencers alike to disclose ads as these labels affect the weight and credibility shoppers may give to the endorsement.
Awin’s findings come as a top German court recently ruled that social media influencers who are paid by brands must clearly label such posts as ads. Last year, Instagram pledged to crack down on influencers flouting ad disclosures following an investigation by the UK Competition and Markets Authority.
Instagram said it would report users who inadequately labeled their posts to the brands whose products they endorse. The platform also launched a prompt requiring creators to confirm whether they’ve received incentives to promote a product or service before they can publish their post, and new algorithms built to identify potential endorsements.