Lack of trust impacting influencers' effectiveness

In the era of social media and online marketing, influencers have emerged as a powerful force. With millions of followers, they wield immense influence over consumer behaviour and their purchasing decisions. However, with great power comes great responsibility, and the issue of influencer trust has become increasingly important in recent years. 

While many influencers use their platforms to promote genuine products and services, there have been cases of scams and unverified claims being promoted, which can erode people's trust in them.

Recently, influencers such as Ankur Warikoo, Chetan Bhagat, Prafull Billore and Raj Shamani, promoted the World Startup Convention - which was to be held in Noida between March 24-26, 2023. But to the visitors' dismay, the event turned out to be a “scam”.

Top Indian Influencers are facing the HEAT

A on how Influencers promoted this Multi-crore Startup Scam. pic.twitter.com/39AM6ax6Go

— Sayan • Creator Economy (@thesayansapui) March 27, 2023

Startup founders had paid up to Rs 10 lakh to book booths and spent thousands of rupees to pitch to over 10k investors as advertised. 

After being called out for promoting the event, Warikoo told Inc42 that he was not involved in the conceptualising or organising of the event. Shamani too shared a statement with Inc42 which was on similar lines. But even after the clarifications, people are calling out the influencers on social media and they are losing trust.

Amid all this, the big question that has arrived is why influencers of such high stature and trust value promote sham and unverified claims. In fact, the organisers use these influencers' videos and run them as paid ads. One of the influencers also claimed this event will provide a ground for raising series A and B funding. 

In an exclusive conversation with BuzzInContent.com, industry players said that while influencers need to be responsible for what they are promoting, we also need to do our due diligence before buying a product or service. Moreover, they also discussed some corrective measures that influencers can take after promoting a scam or unverified claims.

Consumers should do their research before purchasing, such incidents impact credibility of influencers’ content

Anushree Jain

According to Anushree Jain, Co-founder of SocialTAG, the recent incident involving the World Startup Convention is surely going to have a major impact.

“I feel every consumer should do their research before purchasing. While it is the influence's job to bring brands into limelight, a scam like this doesn't assure that the influencer was involved in it. Hence, no matter where you consume from, you should always research before purchasing or investing in a product,” she added. 

Raghav Bagai

According to Raghav Bagai, Co-founder of Youthbeat, influencer marketing as a mode of promotion has recently been the subject of various doubts and suspicions.

“Branded content is a significant source of income for these influencers and creators, they may promote brands/products without fully understanding the brand's vision and values. An example of this is the recent incident involving the World Startup Convention,” Bagai stated.

“The start-up event implicated notable personalities of the industry and riled up a sizeable portion of their audience. Marketers believe that emotional connection and trust are important factors in attracting the masses, particularly in the Indian market. As a result, such incidents can have a significant impact on these influencers and their personal brand,” he added.

Samiksha Mehta

Samiksha Mehta, Business Development Manager, Pollen (Zoo Media) believes this incident won't really impact the followership of influencers in general but it will definitely have an impact upon the credibility of their content. 

"Followers will be doubly cautious of the products, services or events that are being endorsed by influencers," she added.

Influencers should take responsibility of their actions

As per Jain, in order to regain people's trust after promoting a scam or an inauthentic product, influencers can take several steps. They can be transparent and honest with their followers about the incident and take responsibility for their actions in case they were aware about it. 

Furthermore, she went on to say that they can also apologise and offer refunds or compensation to affected customers. Additionally, influencers can work to rebuild their credibility by promoting only genuine and authentic products and being more selective about the brands they work with.

According to Bagai, "In such cases, crisis management is critical. The first and most essential reaction to such incidents must be acceptance and acknowledgment. A few of the start-up event's influencers also came out to share their perspectives. As a result, telling the truth, and telling it first, must be the primary step. Also, given the personal connection that these influencers have, heartfelt and empathetic messaging would be an important step toward damage control."

Mehta believes that honesty is the best policy. One of the main reasons audiences follow influencers is for their authenticity. Influencers should be open about the happenings of the event and their experience. 

They should continuously update their followers on what got them to endorse a particular event in the first place, what actually transpired and what are the corrective measures they are taking. This will satiate the followers’ curiosity. It will help reinstate their trust in them and know that they are also human at the end of the day, she added.

ASCI made rules regarding disclosing brand collaborations more stringent, agencies also have their own codes of conduct

Jain said that, “There are guidelines and codes of conduct that influencer marketing agencies follow to ensure that their clients are promoting genuine products and services. For example, the Advertising Standards Council of India (ASCI) has issued guidelines for influencer marketing that require influencers to disclose any material connection or financial relationship they have with the brand they are promoting.”

“Additionally, many influencer marketing agencies have their own codes of conduct that outline ethical standards and best practices for influencer marketing campaigns,” she added.

Bagai believes that influencer marketing agencies act as the bridge between brands and influencers and have a major role to play in brand messaging. 

"As an agency we adhere to the following guidelines: Avoid casting other brands (competitor or non-competitor) in a negative light. The strategy is not to compare the brand to its competitors but to create a recall value that will stick around indefinitely." Bagai said.

"Avoid reflecting religious views in the brand’s message. Ensure that relevant ASCI guidelines and the code of conduct are followed when developing content and devising a content strategy that does not convey an offensive narrative," he added.

Mehta said that the ASCI acts as a major institution for laying down and even implementing influencer guidelines in the country. ASCI's code requires that advertising be truthful, not misleading, and not offend public decency and morality. 

“Furthermore, they have recently made rules regarding disclosing brand collaborations more stringent.

These rules, if not adhered to, will result in hefty fines and even suspension of accounts in certain extreme cases. These rules are applicable to all influencers and we, as an agency, ensure that these rules are met. Eventually, our goal is to ensure that consumers are not misled by false advertising,” she added.

Government can work with industry associations

Jain said that the government can regulate influencer marketing and prevent scams. They can work with industry associations and advertising standards bodies to develop guidelines and codes of conduct for influencer marketing campaigns. 

“Additionally, the government can strengthen consumer protection laws and provide resources for consumers to report fraudulent or misleading influencer marketing campaigns,” she added.

Bagai said that ASCI has already issued many guidelines and laws to regulate such misleading activities. Another addition that can be made is to mention if the influencer puts up a completely scripted video given by the brand. Scripts provided by brands, if not edited according to personal perspectives, can allow the brands to put across the messaging that benefits them the most. Such checks and balances can help to make the influencer community a more credible and reliable source of information.

To avoid such mishaps, influencer marketing agencies come into picture

As per Bagai, influencers and influencer marketing in general have always been in the grey area. Brands have time and again evaluated their effectiveness via various approaches.

“An industry that is more than a decade old now has reached a point where hindrances and resentment can be observed in some areas. Overall, due to such incidents, the industry has definitely been subject to scrutiny. Hence, to avoid such mishappenings, influencer marketing agencies come into the picture. Marketers assess the credibility and trustworthiness of influencers before assigning them to relevant branded activities,” he added. 

Influencers can minimise chances of promoting a scam instead of going for a quick cash grab

Sayan Sapui, Creator Economy Consultant, on Linkedin, wrote, "How can influencers avoid promoting scams: Influencers need to recognise that trust is the fundamental basis on which their careers are built. Breaking the trust of the audience is detrimental to their own influence as well as the trust on the entire creator economy."

"No product can be treated as a “harmless promotion”. Influencers need to do a thorough check on the product they are promoting and what it is claiming to be," he added. 

Furthermore, he went on to say that while it is true that an influencer can never predict future mishaps by any brand, they can minimise the chances of promoting a scam instead of going for a quick cash grab.

“But, the government is taking measures. The Consumer Affairs Ministry of India has released a guideline that says:  It is the moral responsibility of influencers to verify the authenticity of the product they are associating with for promotions. There are hefty fines! Any influencer who fails to comply with the guidelines can be fined Rs 10 lakhs-Rs 50 lakhs,” Sapui wrote.

“In addition, they can be stopped from endorsements for a period of 6 months to two years. While it is easy to blame the influencers for knowingly or unknowingly promoting the scam, we all have to make sure that we do our due diligence before buying a product, even if a big celebrity promotes it,” he added.

According to a survey conducted by ASCI, 43% of consumers stayed away from influencers when they sensed a lack of transparency, 42% did not trust influencers if they had repetitive content and over-promotion led to a lack of trust for 41% of consumers.

As per Consumer Affairs Ministry's latest guidelines, social media influencers should actually satisfy themselves that the brand they are collaborating with is in a position to substantiate the claims made in its ad. It is the moral responsibility of influencers to verify the authenticity of the product he/she is associating with for promotions.