Celebrity Endorsements on Twitter Being Scrutinized

Would you endorse a product on Twitter if each tweet came with a $3,000 earning? A lot of celebrities, especially in the US, have said a resounding “yes” to this, creating a growing trend of celebrity endorsements on Twitter. And now that several UK celebs have decided they want in on the action, the Office of Fair Trading (OFT) is going after those who don’t disclose their affiliation.

The Guardian reports that the OFT is clamping down on companies and celebs that don’t make the affiliation between themselves clear. It’s one thing to say you’re sipping a latte in Starbucks – it’s another thing to be getting $3,000 to tweet that you are. And the OFT believes consumers have the right to know the difference.

Mid-December, this story was small – the OFT had apparently warned a blog network called Handpicked Media about their practice of not informing consumers of promoted blog posts and tweets. At the time, the owner of Handpicked Media said that the whole issue revolved around a single tweet which she forgot to indicate that it was sponsored.

Now, it looks like this is a much bigger issue.

According to the Guardian, the OFT has launched a full-scale investigation into Handpicked Media. The company operates a commercial blog network, and has been found to avoid mentioning when blog posts or tweets are sponsored.

It looks like the OFT is trying to catch up to the US’s Federal Trade Commission (FTC) when it comes to being a watchdog for consumer protection on Twitter.

The FTC requires that celebrities, experts or anyone endorsing a product must clearly indicate that they are affiliated with the company they are endorsing. When it comes to Twitter, this can be difficult, as you only have 140-characters to work with – but the FTC insists that endorsements must contain words like “ad” or “spon” to indicate to consumers that the tweet was paid for.

Take a look at a tweet from rapper Snoop Dog below for an example of a clearly marked sponsored tweet:

He has included “(Ad)” at the end of the tweet to let his followers know that he was paid to endorse, in this case, Toyota.

As the Guardian mentions, celebrities like Snoop Dog are part of the Ad.ly network, which helps match advertisers with celebrities.

This type of sponsorship is nothing new, but the fact that it is moving to Twitter makes it difficult to monitor. Government watchdogs like the FTC and the OFT are trying to develop standards so that consumers can be made aware of when a tweet is the natural outpouring of wit and wisdom that so often come from celebrity accounts, or whether it is a bought-and-paid-for product endorsement.

This type of transparency will no doubt become commonplace over the next few months on Twitter, as the OFT takes a bigger bite out of companies refusing to acknowledge when a tweet is sponsored, and harsh consequences are established for defectors.