Social media has become one of the most powerful tools for brands seeking to reach consumers. Businesses increasingly collaborate with influencers to showcase products, demonstrate services, and promote lifestyle experiences to large online audiences. However, as influencer marketing becomes more widespread, an important question often arises for viewers: is the influencer expressing a genuine opinion, or is the post part of a paid promotion?
In many cases, the answer is made clear through labels such as “#ad” or “#sponsored,” which signal that the content forms part of a commercial relationship. Problems arise, however, when posts appear to be authentic recommendations but are actually linked to a brand partnership that has not been disclosed.
A recent decision by the Advertising Regulatory Board highlights the legal risks that arise when such relationships are not made transparent.
The Superbalist Influencer Complaint
The matter involved a complaint regarding an Instagram post by a social media influencer featuring products purchased from the online fashion retailer Superbalist. The post formed part of what is commonly known online as a “haul,” where an influencer showcases items they have recently acquired.
Although the post included enthusiastic commentary about the products, there was no indication that the content might be connected to a commercial arrangement. A complaint was submitted to the regulator arguing that viewers were likely to interpret the post as a personal endorsement rather than advertising.
The complaint alleged that the absence of disclosure contravened provisions of the ARB’s Code of Advertising Practice, specifically the rules governing influencer and social media marketing.
Disclosure Requirements for Influencer Content
The ARB’s Code contains a dedicated section addressing advertising in digital spaces. These provisions aim to ensure that consumers can easily distinguish between independent opinions and promotional content.
Under the Code, influencers must clearly reveal any “material connection” they have with a brand. This includes situations where an influencer receives compensation, free merchandise, discounts or any other form of benefit in exchange for promoting a product or service. The disclosure must be obvious and understandable to an average user, typically through clear wording that signals the commercial nature of the post.
Importantly, these rules apply even when the relationship between the influencer and the brand is informal. The absence of a formal contract or direct payment does not remove the obligation to disclose the relationship if a benefit has been received.
The Brand’s Response
In the Superbalist case, the retailer argued that the connection between the influencer and the brand was sufficiently apparent because a promotional code linked to the company appeared in the influencer’s Instagram biography. It was also suggested that the influencer may not have received direct payment for the post itself.
Despite these arguments, the ARB concluded that the post failed to meet the transparency requirements set out in the Code. The regulator determined that the receipt of free products in exchange for online exposure constituted a material relationship that should have been clearly disclosed to the audience.
Responsibility Shared by Influencers and Brands
One of the key points confirmed by the ruling is that accountability does not fall solely on influencers. Businesses that collaborate with influencers are also expected to ensure that promotional content complies with the Code.
Where a brand fails to provide proper oversight or guidance to influencers, it may share responsibility for misleading advertising. The regulator emphasised that advertisers must actively ensure that influencers understand the disclosure obligations that apply when promoting products online.
More Than Just Cash Payments
The decision also reinforces the idea that “payment” in influencer marketing can take many forms. Even where money does not change hands, the provision of benefits such as complimentary products, event invitations, discounts or other perks can still create a commercial relationship that must be disclosed.
Any form of value offered in exchange for publicity may trigger the obligation to inform consumers that the content has a promotional element.
Transparency in the Digital Marketplace
The ruling serves as an important reminder that authenticity and transparency are central to ethical advertising in the digital environment. Social media audiences rely heavily on the credibility of influencers when making purchasing decisions. When commercial relationships are hidden, consumers may be misled into believing that a promotional message is a neutral recommendation.
As influencer marketing continues to shape how brands engage with the public, both influencers and advertisers must remain mindful of the regulatory standards governing online promotions.
Clear disclosure is not merely a regulatory formality; it is essential for maintaining consumer trust in an online landscape where authenticity is increasingly valued.
