A top German court has ruled that social media influencers who are paid by businesses to promote their products must properly designate their posts as advertisement, Reuters reported. If influencers are not receiving payments, they are free to display products without the advertising label.
Details of the case
In the cases of three Instagram influencers, the Federal Court of Justice said that when a fitness influencer receives payments to promote a brand of jam, she should have made it clear that she was advertising.
However, the court dismissed a lawsuit against Cathy Hummels, a television presenter, and influencer. Her post about a stuffed toy brought visitors to the manufacturer’s website. The court concluded that since she was not paid for the promotion, she was not required to label it as an advertisement.
Indian rules regarding Influencer Advertising
On May 27, the Advertising Standards Council of India (ASCI) announced the final ‘Guidelines For Influencer Advertising In Digital Media’. According to the guidelines, all posts published on digital media by social media influencers or their representatives must have a disclosure label that identifies the postings as ads and follows the guidelines’ standards.
The Guidelines identify labels such as “Advertisement,” “Ad”, “Sponsored,” “Collaboration,” “Employee,” and “Free Gift” as allowed disclosure labels. Such disclosure by the influencer must be in addition to the platform’s independent disclosure mechanism. The Guidelines further state that influencers need not label if they are just posting about a product or service that they have purchased and enjoyed. Even if the substance of the post is neutral, disclosure is necessary if there is any material link at all.