Exclusive: Treelife’s Garima Mitra decodes ‘Endorsement Know-hows!’ for celebrities, influencers on Social Media platforms

In an exclusive article for MediaBrief: Garima MitraCo-founder of Treelife, discusses the “Endorsement Know-hows!” guidelines from the Ministry of Consumer Affairs. Garima breaks down key terms such as celebrities, influencers and virtual influencers and highlights their influence on consumer decisions. It also explains the disclosure requirements and emphasizes that the information should be clear, conspicuous and easily identifiable. Garima highlights how the guidelines aim to ensure transparency and prevent misleading practices in product and service recommendations, highlighting the possible consequences of non-compliance. Continue reading

TThe Consumer Affairs Division of the Ministry of Consumer Affairs, Food and Public Distribution has published guidelines for celebrities, influencers and virtual influencers specifically regarding social media platforms. The guidelines mentioned are called “Endorsement Know-hows!” For celebrities, influencers and virtual influencers on social media platforms

These guidelines address the disclosure of certain information by such celebrities and influencers while promoting certain products on social media platforms. These guidelines also aim to ensure that such celebrities and influencers do not mislead their audiences when endorsing products and services.

Let’s break down some keywords and their respective meanings:

• Celebrities: Famous people (e.g. athletes or movie stars) have the ability to influence the decisions or opinions of their followers.
• Influencers: People who promote products and services and have a strong influence on the purchasing decisions or opinions of their followers.
• Virtual influencers: Computer-generated “people” who behave similarly to influencers.
• Material connection includes a variety of benefits, including financial compensation, free products (solicited or unsolicited), discounts, gifts, contest entries, travel, hotel stays, media barter, news coverage, awards, and any family, personal, or professional relationships that benefit the prospects could influence.

Who should disclose information?

Individuals/groups who have access to an audience and have the power to influence their purchasing decisions or opinions regarding a product or service due to the influencer/celebrity’s authority, knowledge, position or relationship with their followers/fans .

Influencers and celebrities can significantly influence the opinions and purchasing decisions of their followers through their position and image. This level of influence is valuable to brands because it can increase brand awareness, preference, and ultimately sales.

Brands work with those influencers or celebrities whose follower base matches their target audience. The collaboration may include product recommendations, sponsored content, product reviews, etc., with the aim of increasing brand visibility and encouraging followers to purchase the products/services.

Since influencers and celebrities have established a certain level of trust and authority among their followers, it is therefore necessary that they adhere to the recommendations so prescribed.

When should such information be disclosed?

A’material connection“ between an advertiser and a celebrity/influencer may impact the weight or credibility of the celebrity/influencer’s portrayal.

If a celebrity or influencer has a material connection with the advertiser, such celebrity or influencer could endorse or promote the particular product or service solely based on the incentives that celebrity/influencer receives as part of the engagement.

Such material connections, coupled with the influencer/celebrity’s ability to influence consumers’ purchasing decisions, would ultimately amount to the influencer and advertiser misleading consumers.

Therefore, in order to protect the welfare of consumers, the criterion of “material connection” has been added to these guidelines.

How can I disclose information?

• Information should be hard to miss – The information must be clear, clearly visible and extremely difficult to miss. Such information should not be mixed with a group of hashtags/links.
• In the case of an endorsement in an image – The disclosures should be placed over the images so that the person viewing them can see them clearly, and they must be of an easily readable size and font. The disclosure should not be lost or blend too much with the background image. There must also be sufficient contrast between the text of the disclosure and the image on which it is placed.
• In case of a recommendation in a video – Disclosures must be made in the video and not just in the description. The disclosures are made in both audio and video formats.
• In the case of an endorsement on a live stream – Disclosures must be prominently displayed throughout the stream.
• Using simple and clear language.
• Terms permitted in disclosure: “advertisement” or “advertisement”; ‘Sponsored’; “paid advertising” or “paid”.
• Disclosures must be made in the same language as the notices.
• Apart from platform disclosure tools, separate disclosures must be made.

Due diligence

Celebrities/Influencers are always advised to check and satisfy themselves that the advertiser is able to substantiate the claims made in the advertisement. It is strongly recommended that the endorser of a product or service actually use or experience that product or service before endorsing it.

Conducting due diligence on the part of influencers or celebrities offers the following advantages:

1. Credibility and reputation: Celebrity/influencer endorsements carry weight because the audience trusts them. By ensuring the veracity of the claims in the advertising with which they are associated, celebrities can maintain and strengthen their credibility.
2. accountability: Celebrities and influencers are responsible for the messages they share because of their public personas. If they spread misleading claims, they can face backlash, reputational damage, or even legal consequences.
3. Justification of claims: Before endorsing a particular product/service, celebrities and influencers should request and review evidence that supports advertisers’ claims. For example, if a toothpaste promises to reduce plaque by 20% in two weeks, the brand should be able to provide reliable studies or tests to back this up.
4. Personal experience: It is advisable for celebrities/influencers to personally use or experience a product or service before endorsing it. This ensures that their recommendation is genuine and based on their own perceptions, which can make the recommendation more relatable and trustworthy for their audience.
5. Possible conflicts: Conducting due diligence can also help celebrities identify potential conflicts of interest. For example, recommending a product that contradicts your personal beliefs or previous recommendations could result in public criticism.
6. Long-term relationships with brands: Building relationships with advertisers based on trust and integrity can lead to long-term partnerships. By conducting due diligence, celebrities signal to brands that they are serious about maintaining high standards in their collaborations.

To quickly summarize the points above, when celebrities and influencers invest time in understanding the brands and products they recommend, it not only protects their own reputation but also ensures that they are providing genuine and trustworthy recommendations to their followers.

Consequences of non-compliance

Such celebs/influencers will be liable for non-compliance or non-disclosure under the Consumer Protection Act, 2019. As per the Consumer Protection Act, 2019, a Central Consumer Protection Authority has been constituted with the power to impose a penalty on a manufacturer or endorser for such false or misleading advertisements which may be up to INR 10 Lakhs.

If such authority deems it necessary, it may also prohibit the supporter of false or misleading advertising from promoting a product or service for a period of up to one year.

Furthermore, as per Section 89 of the Consumer Protection Act, 2019, any manufacturer or service provider who causes false or misleading advertising (prejudicial to the interests of consumers) shall be punished with imprisonment extending up to 2 years and with a fine extending up to INR 10 Lakhs; and for any subsequent offense shall be punishable by imprisonment for a term which may extend to five years and a fine which may extend to INR 50 Lakhs.