The Instagram influencer marketing industry has grown tremendously over the past several years, and is expected to reach a value of over $2 billion by 2019. As the industry grows, rules and regulations are beginning to catch up with influencers and brands. The FTC issued warnings to over 90 top influencers earlier this year, and the recent CSGOLotto scandal marked the first case that charged individual influencers.
The FTC isn’t alone in moving towards stricter regulation of sponsored content. In late August, Instagram announced its adoption of Facebook’s branded content policy, which requires that all branded content be clearly marked using Instagram’s new paid partnership tag.
This shift in Instagram’s policy has major implications for the influencer marketing industry as a whole. Here, we break down what Instagram’s branded content policy is, how it fits in with FTC guidelines, and what it means for the future of influencer marketing on Instagram.
Instagram’s new branded content policy states that when posting content that features or is influenced by a business partner for an exchange of value, creators must use the branded content tool to tag the featured product, brand, or business partner.
Instagram’s branded content tool, also known as the paid partnership tag, was launched in June. The paid partnership tool allows influencers to add a tag directly above their sponsored content that says “Paid partnership with [Brand]”. It can be applied to both Instagram Stories and traditional Instagram posts.
The introduction of the paid partnership tag signaled Instagram’s first step towards encouraging transparency amongst top Instagram influencers. Now, the August announcement of Instagram’s branded content policy makes it clear that this tool is not merely a recommendation, but rather a requirement for all branded content.
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Last month, the FTC provided additional guidelines and recommendations for disclosing sponsored content. These newly released FTC guidelines make it clear that branded disclosure tools are not considered sufficient disclosure on any platform.
According to FTC rules, a content creator who uses the paid partnership tag on Instagram must also include an additional, FTC-approved disclosure such as #ad or #sponsored.
When it announced its branded content policy, Instagram also stated that it will begin enforcing branded content that is not properly tagged. So far it is unclear how strict Instagram’s enforcement of its branded content will be.
By positioning the branded content tool as a platform-wide requirement, Instagram’s new branded content policy may lead to more transparency within the Instagram influencer community. However, given that 93% of top celebrity Instagrammers do not currently follow FTC guidelines, it remains to be seen how Instagram’s new set of rules will have an impact on the state of disclosure.
Aside from impacting disclosure, Instagram’s branded content tool also impacts the industry by providing influencers and brands with access to metrics and analytics. Both the tagging influencer and the tagged brand have access to Instagram Stories metrics such as reach, taps forward, taps backward, replies and exits for 14 days.
Metrics for standard Instagram posts are available to both influencers and brands indefinitely. By providing valuable metrics to marketers and content creators alike, Instagram’s branded content tools will likely play a role in campaign optimization moving forward.