On Focus

Author: Marco Reguzzoni

Advertising and Consumer Law

AGCM VS INFLUENCER MARKETING: from moral suasion to binding commitments

With the order no. 27787 dated May 22, 2019, published in the weekly bulletin no. 23 of June 10, 2019, the Italian Competition Authority (“AGCM”) closed the case no. PS11237, on the ground that the obligations Alitalia, Aeffe (owner of the Alberta Ferretti brand), as well as 13 influencers (including Alessia Marcuzzi, Martina Colombari, Cristina Chiabotto, Elena Santarelli) committed to, are to be considered sufficiently adequate to eliminate the unfairness of the challenged commercial practice, consisting in the dissemination, through social media, of disguised advertising messages that cannot be recognized as such.

The proceedings, which followed a report by the National Consumer Union, is linked to the publication of posts on the Instagram profile of various influencers, where boldly displaying Alitalia’s logo, which was printed on clothing designed by Alberta Ferretti and worn by the influencers from time to time involved.

On this, the AGCM objected that "the conduct of the professionals mentioned above (i.e. Alitalia, Aeffe and the influencers) is likely to constitute a violation of Articles 22 and 23, paragraph 1, letter m) of the Italian Consumer Code, since the emphasis on Alitalia’s brand and the reference to Alberta Ferretti’s cannot be interpreted other than as a message with a promotional intent”. According to AGCM, consumers should have been warned that they were looking at an advertising message and not at spontaneous story in the influencer’s daily life.

Considering this objection, all the parties involved in this case took steps to avoid the sanctions by undertaking to binding commitments for the future.

Alitalia's undertakings include: A) the adoption of Guidelines to define and set a sort of code of conduct for influencers involved in promoting the services of the company and B) a standard clause to be included in future co-marketing contracts, providing for an obligation for commercial partners to take all necessary precautions to avoid subliminal advertising messages in influencer marketing.

Aeffe has taken a step further since it undertakes that “in any sponsorship or endorsement contract that it will enter into with influencers for the promotion of its goods or services, the influencers are expressly bound to make it clear that Aeffe's contents posted on social media are meant for promotional purposes, for example using hashtags such as #suppliedbyAlbertaFerreti or #courtesyofAlbertaFerretti?” or #adv or #sponsored”. Aeffe also intends to provide for "a penalty of not less than 10% of the total amount provided for in the contract in favor of the influencer" if the influencer fails to fulfil his/her obligations and "the right of Aeffe to terminate the contract” if the influencer keeps “forgetting” his/her obligation.

On their side, the influencers have undertaken to convey the promotional purpose of the contents they disseminate on social media in a transparent manner, not only with regard to the brands involved in the proceedings at hand, but also with regard to any other brand they will have relations in this regard in the future. In practice, when they entered into any contractual relationship established with brands or when they receive free-to-use products, influencers now have to use appropriate hashtags whenever the product displayed in the post/story is a gift (for example, #suppliedby) or if it is promoted as part of an influencer marketing operation (such as #advertising, #sponsoredby, #pubblicitàbrand, #sponsoratodabrand and other hashtags).

AGCM found these undertakings suitable for remedying possible profiles of unlawfulness of the business practice challenged in the proceedings.

This is the first time that a case of subliminal advertising on social networks has been closed in Italy. After delivered letters of moral suasion to the influencers last December (see, AGCM succeed to obtain specific commitments for those influencers who violate its provisions. The next step will be hopefully the application of the penalties provided for by the Italian Consumer Code. It is thus of the utmost importance to ensure consumers the maximum transparency and clarity on the possible advertising content of posts on social media, given that subliminal marketing is particularly insidious because it can leave recipients without the natural defenses activated in the presence of a straightforward advertising messages.