The French cosmetics chain Sephora has found itself embroiled in a daily battle against the latest wave of fraudulent online advertising activity as it seeks to expand into Southeast Asia and nurture organic content creation from impactful market influencers.
The Hard Road Ahead
Sephora is one of many brands all over the world that has been caught up in 2017’s fraudulent online ad activity surge, an episode that has been estimated to have doubled in scope when compared to the previous year. While overall online spend estimated to reach more than $83 billion by the end of 2017, fraudulent ads and impressions are expected to cost advertisers as much as $16 billion. Add this to Sephora’s aim to expand in the Southeast Asian market and the brand has a hard road ahead before it can feel at ease.
Light At The End Of The Tunnel
In an article published by TheDrum earlier this week, Seophra Digital’s SEA Head Of E-commerce and VP of Marketing, Nandini Joshi, revealed keen insights regarding influencer impact on consumers and these content creators’ desire to participate in more dedicated marketing roles aligning with the brand.
For those unfamiliar with influencer marketing, it is the practice of soliciting and/or employing people of influence to promote a product rather than targeting a market as a whole.
While Joshi acknowledged the influencer significant impact on consumers and each’s value as an authentic voice, the arrangements many of these influencers seek to strike deals around are delicate and precarious, to say the least.
The Issue Of Transparency
In the US, influencers and brands re required by law to reveal their ties, detailing whether reviews, opinions, and other testimony surrounding a company’s products are paid for or not.
For those influencers looking for more permanent positions within Sephora’s marketing channels, the question of transparency will no doubt come to the forefront of conversation. Bringing on influencers as formal employees will place content under far more scrutiny considering its legitimacy. Would these influencers continue reviewing other products alongside Sephora’s within these arrangements? How does one reconcile an influencer’s relationship with a brand in delivering an opinion of a product? How can it remain unbiased? The result remains to be seen.
In the US, penalties for failing to disclose an advertisement as a paid-for can incur steep fines for influencers as well as brands. Fines can reach incredible sums as they are incurred on a per-instance basis.
Earlier this year, the FTC released a reminder specifically directed toward influencers and brands to disclose the nature of their relationship in an effort to minimize deception and increase transparency in the marketplace.
In Australia, one of eight markets Joshi oversees in SEA, the Australian Association of National Advertisers (AANA) released a set of guidelines that take a strong stance on the issue. Should legal action be taken as the result of lack of transparency in advertising, fines can climb quite high. A maximum levy of $220,000 per post for an influencer and $1.1m for a brand could be the result.
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