A recent study published in the peer-reviewed journal Marketing Science has uncovered that 95% of influencer posts on Twitter (now known as X), which are sponsored, do not disclose this fact. The research article “How Much Influencer Marketing Is Undisclosed?” is featured in the INFORMS journal Marketing Science. The authors, Daniel Ershov of University College London and the Centre for Economic Policy Research in London, Yanting He from Imperial College London, and Stephan Seiler, also associated with the Centre for Economic Policy Research and Imperial College London, have contributed to this revealing study.

The researchers have noted that posts that do not disclose their sponsorship tend to be linked to relatively young “brands” with large social media followings. Yanting He remarked on the findings, stating, “Our study findings highlight a potential need for further regulatory scrutiny,” emphasizing the importance of transparency in influencer marketing.

Influencer marketing represents a modern strategy to reach consumers, sidestepping traditional advertising media such as broadcast and print. This method employs individuals to endorse brands, products, or services, compensating them for their promotional efforts. Typically, these influencers are chosen based on their substantial social media presence and/or celebrity status. Daniel Ershov highlights a significant issue: “Because consumers might find it difficult to distinguish paid influencer posts from genuinely organic content, regulators in many countries now require any paid content to be disclosed.” He notes, however, that “because of the novelty associated with influencer marketing, the evolving regulatory framework has not caught up.”

To conduct this study, the researchers utilized a novel dataset of over 100 million brand-related posts on Twitter from 268 brands. They developed a new text-based classification approach to identify undisclosed sponsored content. By quantifying the impact of undisclosed influencer posts, they aimed to assess whether consumers could detect when commercial content was not disclosed. They tracked the progression of these undisclosed posts over time and were able to pinpoint the brands involved in these secretive advertising tactics.

The findings were quite revealing: many participants in an online survey could not identify commercial content that lacked disclosure. Stephan Seiler shared insights from the study, saying, “We found that although regulation did tighten up over our sample period from 2014 to 2021, the share of undisclosed content decreased only slightly.” The research also showed that undisclosed sponsored posts frequently originate from younger brands with significant Twitter followings, underscoring the ongoing challenges and the urgent need for stricter regulatory measures to safeguard consumers and ensure the transparency of influencer marketing practices.

More information: Daniel Ershov et al, How Much Influencer Marketing Is Undisclosed? Evidence from Twitter, Marketing Science. DOI: 10.1287/mksc.2024.0838

Journal information: Marketing Science Provided by Institute for Operations Research and the Management Sciences