The UK watchdog, The Competition and Markets Authority (CMA), is calling for the power to fine influencers if they fail to declare to their followers when a post has been sponsored.
The CMA told MPs that it needs stronger capabilities to enforce consumer protection laws in order to deal with an “endemic market-wide problem”.
The CMA’s senior director for consumer protection, George Lusty, told the House of Commons that “the market has blossomed, the influencer marketing market has doubled in two years and it’s very, very effective“.
He said: “It’s much more powerful than traditional advertising techniques and it’s particularly powerful with younger people in persuading them to buy things.”
However, he explained that fines enabled through court action took too long, adding that the CMA should have the power to carry out fines independently going forward.
The call comes as the Advertising Standards Association (ASA) also ramps up its influencer ‘name and shame’ campaign after five former Love Island contestants and reality star Jodie Marsh were called out following repeated warnings for not labeling ads properly.
Lusty added that, despite commitments made by Instagram last year to crack down on undeclared posts through more rigorous vetting, social media platforms themselves are not being severe enough in penalizing influencers who fail to comply.
“We’re still seeing across all platforms a very low level of sanctions actually being applied and practiced against influencers," he said.
Regulators maintain that the use of #ad remains the clearest way to disclose paid content or recommend using platform tools such as Instagram’s Paid Partnership function.