When a Sponsored” Disclosure May not be Enough

NAD recently reviewed posts promoting Cariuma sneakers that appeared on the Facebook and Instagram accounts of Travel + Leisure, US Weekly, and The Quality Edit. The posts claimed that various celebrities wore the sneakers, encouraged consumers to buy the sneakers before they sold out, and included links to make a purchase or learn more. Each post was labeled as sponsored.”

NAD assessed whether the posts were ads or editorial content and concluded that they fell into the former category. If you want to learn more about how NAD came to that conclusion, you can read the decision. In this post, we’re going to focus on the sponsored” label. Although advertisers have long thought that to be a safe” option for a disclosure, this decisions demonstrates that’s not always the case.

Here, NAD was concerned that while the posts were labeled Sponsored,’ it is not clear whether the posts are sponsored by the publisher or by Cariuma, the brand promoted in the posts.” NAD noted that recent FTC guidance suggests that a Sponsored” disclosure may not always be enough and in some cases it would be clearer if the post identified the brand that sponsored the social media post.”

FTC echoed that guidance in November when it sent warning letters to two trade associations and 12 influencers over their posts. Some of the letters expressed concern that although posts were labeled as sponsored,” it wasn’t clear who sponsored them. Without knowing who the sponsor of the post is, viewers might not be able to adequately evaluate the weight and credibility to give [the] endorsement.”

In many influencer campaigns, it should be obvious who is sponsoring a post, so it’s likely that a sponsored” label will be sufficient. But this case demonstrates that using sponsored” isn’t a safe harbor,” as some have thought. It needs to be clear who is behind the post. This case also demonstrates that advertisers don’t just have to worry about the FTC – the NAD is focused on this issue, as well.