Are you a celebrity? ASCI will decide
The circular places the obligation of due diligence before endorsing a product. Any testimonials or opinions made during such endorsement such be genuine, stemming from their own experience.
In a bid to curb spread of misinformation via popular faces on social media and otherwise, the Advertising Standards Council Of India came up with guidelines to define a celebrity.
The move comes amidst increased instances of well-known, albeit non-specialist individuals promoting products in exchange for money. According to the ASCIs 2022 half-yearly compliance report, about 781 complaints were registered against various influencers. Out of this, 10% were financial i.e. related to promotion of virtual digital assets (VDA).
As per the new guidelines, if an individual meets both or even one of the following criteria, they would be classified as an influencer:
- Receive compensation of Rs 40 lakhs, or get something in similar value equally during an year, for appearing in advertisements/campaigns, irrespective of medium/format.
- Has a social media following of over 5,00,000 on a single social media platform like Instagram, facebook, twitter or more.
Going ahead, the term will not only include influencers or actors, but also prominent doctors, educationists, social workers and more. Disclaimers and disclosures will be mandatory, particularly for medical/health professionals.
The circular places the obligation of due diligence before endorsing a product. Any testimonials or opinions made during such endorsement such be genuine, stemming from their own experience.
Moreover, the celebrity or their agent will have to submit a written confirmation to ASCI which highlights that they stand the claims they’ve made for any advertisements they’ve appeared in. Additionally, their claims should be capable of independent verification as well.
A recent report by Motilal Oswal noted that around 60% of people in its survey made crucial investment decisions based on what they see on social media channels. A recent study by Portsmouth University noted that 22% of consumers in the UK ended up purchasing counterfeit products, thanks to endorsements from social media influencers.
No wonder, the government has been tightening the noose around influencers and people capable of shaping discourses and decisions via social media and other platforms. Even SEBI is in the midst of finalizing a draft paper that will detail rules and guidelines for the mushrooming breed of fin-fluencers, or non-specialized financial advisors who dish out investment advice to the public.