As the world has evolved, the way products and services are marketed and sold has gradually changed. Brands, companies are now employing popular celebrities as ambassadors, hoping that the reputation of the celebrity endorser of the brand will be transferred to the products or services to outperform their competitors and attract attention to a larger share of the target market.
Celebrity endorsement is a form of advertising campaign or marketing strategy used by brands, corporations or non-profit organizations in which celebrities use their social status or fame to promote a product or service, even for positive impacts such as environmental awareness to achieve or social affairs.
Prominent endorsers are also referred to as “influencers”. They play a crucial role in creating brand awareness and also influence consumer choices.
While celebrity endorsers are often perceived as bridge builders between brands and consumers – the target audience – as their social status creates a strong and understandable emotional bond with consumers.
Various companies sign deals with celebrities in the hope that by using celebrities to market their products, they can achieve a unique and relevant position in the minds of consumers.
Celebrity endorsements are increasingly being used across industries, regardless of product type.
The marketing and advertising industry has evolved into an organized industry that leverages innovative ideas aimed at engaging viewers and building a bond with the public. Most brands, regardless of product/service category, look for celebrities to endorse the brand and attach themselves to the reputation and familiarity that comes with the celebrity, increasing the value of the brand.
The most nagging question, however, is whether a Celebrity Ambassador is liable in the event of a breach, default, or inadequacy of a product or service?
In Nigeria, the regulation that protects consumers’ rights is the Federal Competition and Consumer Protection Act 2018 (FCCPA), which aims to protect the interests of Nigerians who buy products sold in Nigeria and patronize business services in Nigeria.
There are growing concerns that some companies promoted by some celebrities on social media have turned out to be fraudulent and many consumers are losing their hard-earned cash.
Although there is currently no comprehensive law governing misleading celebrity advertising; The Advertising Practitioners Registration LFN 2004 contains some specific guidelines for advertising in Nigeria.
It should be clearly stated that in a celebrity/brand relationship, there is a contract between the two parties that sets out the terms and expectations of each party, but the contract does not usually impose direct liability on the endorser.
The relationship between celebrity endorsers and producers is governed by contracts between the two parties, which in most cases exempt the celebrity from any liability related to such commercials.
The accuracy of the celebrities’ claims regarding the supported products is immaterial and the backers are free to make any claim/statement suggested by the producers, notwithstanding the fact that the backers may not find the product as advertised claimed to have used .
When it comes to celebrity endorsement of products and services, the mere puff issue can arise as the customer attaches greater value to products endorsed by celebrities.
It should be noted that the role of an endorser is purely that of a medium for the transmission of information and not that of the manufacturer of the product.
In cases where the celebrity limits their liability through their endorsement contract, the bulk of the liability for misleading or deceptive advertising would fall on the product manufacturer and not the celebrity.
This therefore underscores the need for celebrities to ensure they have properly drawn up legal contracts to protect them before engaging in any promotional activities or dealings.
However, it should be noted that an exclusion clause in the advertising contract does not automatically limit or exclude the celebrity’s liability for misleading or fraudulent advertising in all cases.
For example, the celebrity would be jointly liable with the product manufacturer if the celebrity is entitled to a cut in the brand’s profits resulting from the misleading marketing. The United States Federal Trade Commission (FTC) has sanctioned celebrities who have encouraged pyramid schemes and shared in the profits from such scams.
Also Read: Celebrity Trolls: The Nigerian Toxic Online Stan Culture
A disclaimer would therefore not benefit a celebrity who has moved beyond the traditional role of brand influencer by engaging in profit sharing.
In addition, a celebrity also owes a duty of care to their fan base. A celebrity is expected to properly investigate the veracity of the brand’s product or service claim in order to protect and safeguard the interests of consumers overall.
It would be irresponsible for a celebrity to swallow the claims of the manufacturer or service provider without at least superficially testing the product or service to make sure it really does what the manufacturer claims.
In some jurisdictions, influencers may be held liable for statements made as part of their endorsements, notwithstanding that they read from a script created by the manufacturer of the product or service owner.
This therefore places a duty on the celebrity influencer to conduct their own independent research before endorsing such products.
In addition, a celebrity or influencer can also be held liable if they continue to be involved in the influencer activity despite numerous consumer complaints about this falsehood of the information provided in the recommendation. It is therefore necessary for celebrities to pay attention to consumer reviews that result from their endorsement.
For example, a celebrity would be liable if they post a video on their Instagram page and receive numerous comments on the social media pages about the fraudulent or harmful nature of the product or service, but still post additional videos or promotional materials.
It is important to note that the FCCPC was established, among other things, to review economic activities in Nigeria, to identify anti-competitive, anti-consumer and restrictive practices that may harm the economic interests of consumers, and also to eliminate anti-competitive practices. Competition agreements, misleading, unfair, deceptive or immoral marketing, trade and business practices in accordance with Section 17 of the Federal Competition and Consumer Protection Act 2018.
Thus, when a celebrity or influencer makes deceptive and misleading endorsements, the FCCPC can exercise its regulatory and disciplinary jurisdiction over both the producer/owner of the service and the celebrity complicit in the endorsement. This is because endorsement itself is a marketing practice.
Therefore, celebrity endorsement deals should not be taken lightly by either party, as an oversight on either side can have serious consequences for both the manufacturer/service provider on the one hand and the celebrity on the other.
Therefore, both parties must ensure that the terms of the endorsement deal are contained in a formal contract. Both parties should also seek legal advice from their respective attorneys before signing the contract.
Celebrity lawyers should insist on detailed accounts of brands in relation to product quality and compliance with product advertising regulations. Celebrities should also include robust indemnification provisions in the contract to cover the potential penalties and legal costs that celebrities may face in the future.
Edoigiawerie, a lawyer, writes from Lagos
Comments are closed.