ASCI’s new diktat a severe blow for health and finance influencer endorsements?

Doubling down on its intention to become a sieve for transparent and accurate influencer advertising, the Advertising Standards Council of India (ASCI) has revised its influencer guidelines that were first introduced in May 2021. It has placed additional responsibilities on finance and health influencers for brand endorsements.

It says that finance influencers or ‘finfluencers’ operating within the BFSI realm, can now offer investment-related advice only after being registered with the Securities and Exchange Board of India (SEBI), India’s market regulator. 

According to ASCI, if the influencers are offering other financial advice, then they must possess appropriate credentials. These include a license from India’s insurance chief, the Insurance Regulatory and Development Authority of India (IRDAI), they must be qualified as a chartered accountant, hold a company secretaryship, etc.

ASCI also wants influencers who endorse products that make claims on health and nutrition, to hold relevant qualifications. These include medical degrees or certifications in nursing, nutrition, dietetics, physiotherapy, psychology, etc., depending on the nature of the advice provided.

As per ASCI’s press note:

The influencers must disclose their qualifications and registration/certification details prominently in all types of promotional material:

1. Superimposed on the visuals prominently and upfront, or mentioned as the opening remark in videos.

2. For blogs or any text-based posts, they should be stated upfront before the consumer has to read the post.

3. In the case of podcasts or a purely audio medium, they should be called out at the beginning of the advertising content.

These additions come right on the heels of the government’s additional guidelines for health and wellness influencers, celebrities and virtual influencers, to deal with misleading ads and unsubstantiated claims.

Therefore, the ones making the claims need to present disclaimers “ensuring the audience understands that their endorsements should not be seen as a substitute for professional medical advice, diagnosis or treatment,” says the government’s note.

ASCI’s revised guidelines impact the health and finance creator ecosystem in many ways. For starters, it alienates a majority of creators from brand deals because they don’t meet the stated certifications.

Sharan Hegde, for example, finds himself flouting the said guidelines because while he has made paid posts on finance, he, as per his LinkedIn bio, doesn’t have any of the degrees or certifications that ASCI has mandated.

Second, brands will now have to rethink their influencer marketing strategy so that they don’t find themselves in violation of ASCI’s guidelines. There may also be a rise in the rates that the influencers, who meet the guidelines, charge because of high demand.

We asked these questions, and a bit more, to the ones inside the creator universe.

Edited excerpts:

Deepali Shetty, co-founder, narrative, a branding and communication agency

Before we comment on the guidelines, it is crucial to understand where they stem from. Unlike fashion advice or, say, recommending a restaurant, spurious health claims and suggestions on financial matters can have life-altering consequences.

In both these areas, people tend to expect immediate/unrealistic outcomes, in terms of monetary gains or significant health improvements. This is why such content gets rapid response.

The guidelines are a fantastic move to ensure that people are not misled by influencers’ messages. The move will help filter genuine influencers from amateur content creators, and provide credibility to people who have a relevant background on the subject.

Also, it is important to note that the TG for such videos includes people across ages and backgrounds looking for health and financial advice online.

Unaware that an influencer’s background/qualification matters, many tend to consider their advice easily. These guidelines will add a layer of protection for people who are not attuned to how the content landscape works and possibly listen to an influencer because the message was shared with them.

Danish Malik, founder and CEO, Boomlet, an influencer marketing agency

There is a need for clear penalties or fines, unlike is the case with SEBI or the CCPA, or else people may fail to take the guidelines seriously. ASCI needs to show people how it treats violators to get them on board.

The need for certain certifications or membership, may hurt because a young creator talking about general finance, may not have any idea about SEBI or how to go about getting its membership, like a SEBI-registered experienced broker. A better alternative is a version of Dubai’s social media influencer license that makes for a level playing field.

Will influencers who meet these guidelines, raise their prices? Yes, of course.

This will also lead to an increase in the grey area of the influencer endorsement universe where a brand may decide to breach the guidelines because it wants more affordable influencers.

And, these influencers may increase their prices for breaching the said guidelines, but it will not pinch the brand as much as roping in big influencers, who have raised their endorsement rates.

Raghav Bagai, co-founder, YouthBeat, a youth marketing wing from Sociowash

On immediate impact: All plans/campaigns that are already in motion, will have to be relooked at, restrategised and, in some cases, even scrapped. These guidelines are good enforcements and should have a positive impact on consumers over the long run.

On brands reconsidering influencer marketing: The current modus operandi will change for sure, but marketers are a curious bunch and will figure out a solution. The overall impact of influencer marketing in these domains is quite sizeable. Hence, they will find a middle ground from where they can operate. Marketers are usually quite good at this.

On eligible influencers increasing their charges: This presents a golden opportunity for a few selected niche creators. They, most certainly, would like to milk this opportunity to the maximum. Think of it as an athlete’s career. They usually get the maximum collaborations/sponsorship opportunities during the peak of their career and major tournaments. This is the Super Bowl time for certified health and finance content creators. It’s their time to shine.

Chandralekha MR, a finance content creator

The guidelines are still unclear on the extent to which they will cover the nuances in this space. As a personal finance creator, only 10% of my marketing campaigns were dealt with advice in any form. Most of them are quite generic. They talk about the importance of insurance, investment, etc., and educate people about the complexities.

For a knowledgeable person, it won’t take much time to complete these exams and get registered. So, if that’s the requirement, people still have a way to do it.

Ramya Ramachandran, founder and CEO, Whoppl

The whole idea of influencer marketing is to dissect the brand messaging in such a way that the consumers understand how exactly it is going to function. It is fair to have guidelines because today, people blindly believe what influencers are talking about. 

Unmisha Bhatt, co-founder & chief strategy officer, Tonic Worldwide

The guidelines are likely to reshape the influencer ecosystem, at least in the immediate term. Influencers without the necessary qualifications, may lose out on opportunities to collaborate with (health and finance) brands and, hence, their earnings could be affected.

While we expect more responsible, transparent and credible alignment of influencers’ expertise with the content they promote, it is definitely going to increase the time and effort they will have to spend in ensuring compliance to the registration and disclosure mandates.

With the revised guidelines, brands operating in these sensitive categories will need to establish a robust framework for vetting and monitoring the process for influencer collaborations. They are likely to take a more involved and cautious approach in order to maintain credibility and safeguard their brand image.

Kalyan Kumar, Co Founder and CEO of KlugKlug

The guidelines are a good approach. Regulators need to step in when it comes to finance and health. The issue is where do you draw the line. There are many areas where I don’t need to be an expert to make recommendations.

For this, brands need to be responsible for what the influencers say. Paid partnerships could be made mandatory in the case where they are paid collaborations. But where do you draw the line even a certified influencer can give out wrong information. Some deep thoughts need to be put into this to define boundaries instead of generic regulations that are both impractical and in some cases also be misused. At the end of the day, consumers need to be protected. I think these are initial regulations that will be fine tuned. 

Shivam Agarwal, co-founder, Kromium

The potential rise of a new category of creators, registered with regulatory bodies like SEBI, IRDAI, or possessing medical certifications, is a plausible outcome. Brands may prefer collaborating with these certified individuals due to the added credibility they bring. This could create a shift in the influencer landscape, where certified creators become the go-to choice for certain industries. This shift could also provide a competitive edge to these certified creators, changing the dynamics of influencer selection. While they are not legally binding, they do hold significance for responsible advertising practices.

Is the scrutiny unfair?

Ayush Shukla, founder, Finnet Media

The guidelines are unfair because the decision was taken without speaking to us, the creator community. Now you can say that there is credibility added to it. However, what’s not clear is, why aren’t we penalising the ones who are sharing the wrong information and making a distinction with the creators who are giving the right info?

Agarwal, of Kromium adds, “The fairness of these guidelines, can be debated. The essence of influencer marketing lies in relatability and personal connections, and requiring only professionally certified individuals to participate (promoting products) might alter the perception of influencers.

“However, if actions were taken against guideline violations, it could foster a more responsible approach. Some influencers may be unaware of these guidelines due to their complexity, which could lead to unintentional violations. This calls for better education and guidance, potentially leading to more conscientious endorsements.”

(With inputs from Shreyas Kulkarni)