Canada Is Cracking Down on Influencer Marketing

Celebrity influencers like Kylie Jenner reportedly receive around $750,000 USD per sponsored post on Instagram, and Ad Standards notes that around 35% of Canadians between the ages of 18 and 35 have purchased an item because of an influencer’s endorsement. As a reaction to the growing influencer marketing industry, The Fashion Law reports that the Canadian Competition Bureau recently discussed the steps it is taking to better regulate the growing industry and to hold companies accountable for false representation.

Two main concerns of the Bureau are the spreading of false or misleading information like unconfirmed scientific benefits and the failure to disclose material information – both of which mostly apply to beauty products. For all industries, Canadian law requires influencers to disclose any “material connection” between themselves and who/what they are promoting. Material connections include: “received payment in money or commissions, received free products or services, received discounts, received free trips or tickets to events, and has a family or social connection.” Influencers are expected to use specific hashtags like #ad or #sponsored at the beginning of their captions to ensure transparency.

Now, the Bureau has confirmed that it will be enforcing these rules much more strictly, specifically in the health and beauty, fashion, technology and travel industries. In December 2019, it reportedly sent formal letters to around 100 brands and advertising agencies asking them to “review their marketing practices to ensure compliance with the law.” Additionally, the Bureau told the companies that influencer reviews must be based on actual experience using the product or service, otherwise they will face false advertising action.

Elsewhere in business, Twitter has announced a record Q4 revenue of $1.01 billion USD.