Businesses are increasingly questioning the value of “celebrity” social media influencers and appear to be favouring partnerships with “micro influencers” as a more cost effective marketing strategy.
A “micro influencer” is a social media user with between 1,000 to 90,000 followers who, like a traditional influencer, makes posts promoting products. Their key advantages include use of products out of real loyalty to a brand (in some cases), smaller and more intimate followings and, as a result, the perception of genuine endorsements by their followers. “Micro influencers” also require much lower remuneration, if any, and exist in greater abundance than “celebrity influencers”, and therefore can generate content at a scale that captures more market segments.
It has become common practice for businesses to send “micro influencers” free products and/or pay nominal amounts in return for an Instagram post or YouTube review about a product. However, whilst these “micro influencers” present enormous return on investment potential, there are significant legal and reputational risks involved with using less sophisticated influencers. Accordingly, businesses should ensure that “micro influencers” are made aware of obligations:
- under the Australian National Advertising Association Code of Ethics and Australian Consumer Law to clearly indicate that their content is sponsored, such as using the hashtags #ad, #spon or #sponsored;
- to not improperly use the business’s intellectual property such as trade marks, or infringe any third party rights; and
- to comply with social media policies to ensure that any posted content is not taken down by platform moderators.
To ensure compliance and risk mitigation, businesses should actively monitor content they have sponsored and request corrections if necessary.
There have also been reported instances of children being used as “micro-influencers”. As an additional step, businesses should confirm the capacity of the influencers they are using and/or take all reasonable steps to ensure that parental consent is obtained before entering into any agreement if they are under the age of 18.
This blog was co-authored by Alexandra De Zwart, Valiant Warzecha, Jessie Buchan and Melinda Upton.