Influencer Marketing and the Fyre Festival Debacle
Trouble In Paradise
Fyre Festival sounded too good to be true: a music festival in the Bahamas with luxury accommodation, big name artists and supermodel guests. When it turned out that is was too good to be true the internet had a field day. The sight of people who had spent between $1,000 and $12,000 on a festival ticket stranded without food or accommodation caused much amusement on Twitter. The organisation and amenities, or the lack thereof, lead to Fyre Festival being described as “closer to The Hunger Games or Lord of the Flies than Coachella”.
It soon became apparent that the organisers had made a series of really big mistakes one of which was failing to spot the looming disaster. When guests arrived they found the festival site ill prepared to receive them. The organisers had apparently run out of money and the festival was shut down a day later because of a failure to pay the necessary customs duties. This apparent lack of funds (despite the high ticket costs) lead to people questioning where the money had gone.
One of the main ways Fyre Festival was promoted was through the use of Instagram Influencers, in particular models like Bella Hadid, Elsa Hosk and Alessandra Ambrosio. On the 12th of December 2016 these influencers posted an “ambiguous orange tile” which apparently reached 300 million people within 24 hours. These posts, as well as almost all subsequent IG posts, are believed to have been paid for and yet were not marked as Ads. As The Fashion Law points out this could mean that the promotion was illegal due to the failure to “clearly and conspicuously” disclose the fact that the models received compensation for their efforts. Emily Ratajkowski was the only model who appeared to have labeled her post as a promotion, as required by the Federal Trade Commission.
“All of the lawsuits to date have noted the role of influencers in affecting their decisions to buy tickets. If the FTC had made an example of the Kardashians or Chiarra Ferragni years ago, this may have been avoided to the extent that influencers, in this case, would have disclosed that their Fyre Festival posts were sponsored.”
Julie Zerbo, editor-in-chief of The Fashion Law
It has been alleged that the influencers received at least $20,000 per post as well as travel and accommodation to the island prior to the event. Kendall Jenner reportedly earned a hefty $250,000 for a post to her 66.8 million Instagram followers. There are now at least 7 law suits in progress from those seeking compensation from festival organisers Billy McFarland and Ja Rule (yep, that Ja Rule). Some of these are believed to reference the potentially illegal influencer marketing undertaken prior to the festival. We’ll have to wait to see how these law suits turn out and whether the Influencers or their management will be involved at all.
Do Users Care?
The Federal Trade Commission recently sent out almost 100 letters to social media influencers over violating rules about sponsored posts. This, in combination with the ongoing law suits arising from Fyre Festival, suggests that we may witness a crackdown on undisclosed ads on Instagram. What’s odd is that users don’t seem to mind when a celebrity posts an #ad even when they do disclose it. In the age of Sponsored Content (and musicians playing sponsored stages like the one at SXSW made to look like a giant Doritos vending machine) perhaps people just overlook the payment and focus on the content. I doubt many people looking at a photo of Emily Ratajkowski in a bikini in the Bahamas care if it’s an #ad or not.
What’s clear is that whilst many users don’t care (apart from the ones who bought a ticket to Fyre Festival) the FTC in America and the Advertising Standards Authority in the UK do care. The ASA have strict guidelines about ads being clearly identifiable. However some would question their ability to strictly enforce these. In 2014 Mondelez UK Ltd were found to have failed to disclose that some YouTube videos about an Oreo Lick Race had failed to provide the necessary disclosure. Mondelez UK Ltd were told not to use the Ads again and to ensure that future Ads were disclosed. In theory the ASA can go beyond this but in practice they rarely do. Most upheld complaints featured on the ASA’s site say “The ads must not appear again in their current form”.
It may be that Instagram themselves need to play a bigger part in this – afterall they would rather advertisers pay them for Instagram ads rather than that money going directly into an influencer’s bank account.
Instagram appear to be testing a function that would allow you to add a “Partner” in a similar way to their feature which lets you tag people in an image. This hasn’t been rolled out yet but it seems likely that Instagram are working on a way to regulate #ad posts.
Update: Instagram have now launched a new feature which allows influencers to clearly signpost paid for content:
The Drum reports that the “‘paid partnership’ tag, is rolling out to a select number of global creators – ie influencers, publishers and business pages – over the coming weeks.”