The Dark Side of Influencer Marketing: Fraud, Discrimination, and Unethical Practices
The Dark Side of Influencer Marketing: Fraud, Discrimination, and Unethical Practices
Influencer marketing has become a booming industry, with brands spending billions to promote products through popular internet personalities and local influencers. However, behind the glitz and glamour lies a dark underbelly of unethical practices that are plaguing the industry.
According to experts and analysts, influencer brand deals and advertisements are rife with fraud, discrimination, and unethical behavior due to the lack of regulation in the rapidly growing industry. Since 2016, the dollars driving influencer marketing have skyrocketed from $1.6 billion to an estimated $21.1 billion in 2023, with projections to reach $24 billion by the end of 2024.
Researcher Emily Hund, author of “The Influencer Industry: The Quest for Authenticity on Social Media,” argues for new regulatory guardrails to be applied to the industry. She highlights the exploitation that occurs among marketers, brands, influencers, and platform companies due to the lack of oversight.
For brands, the rise of fake influencers who manipulate metrics to inflate their engagement numbers poses a significant threat. This fraudulent behavior costs businesses billions in wasted ad spending and damages their reputation when influencers promote products inappropriately.
Consumers are also at risk, as the Federal Trade Commission (FTC) only provides basic guidelines for disclosure requirements in influencer marketing. High-profile cases like Kim Kardashian’s failure to disclose a paid partnership with EthereumMax crypto tokens highlight the need for stricter regulations.
Influencers themselves face challenges, with reports of racial discrimination, pay gaps, and scams targeting aspiring content creators. The industry’s pervasive uncertainty and lack of professional protections leave influencers vulnerable to exploitation and harassment.
Despite these issues, influencer marketing continues to thrive due to the perceived authenticity of endorsements from trusted personalities. However, without stronger regulations and oversight, the industry’s ethical conflicts are unlikely to be resolved anytime soon.
As the industry grapples with the dark side of influencer marketing, stakeholders must work together to address the fraudulent, discriminatory, and unethical practices that threaten the credibility and integrity of the industry.