Fix-it-when-flagged mindset causing compliance issues: Experts on influencer violations

The Advertising Standards Council of India (ASCI) has released a Compliance Scorecard Report on influencer marketing, revealing that Fashion & Lifestyle, Telecom Products, and Personal Care emerged as the worst offenders, accounting for 62% of violations. Industry experts suggest that these categories are particularly prone to non-compliance due to the high volume of influencer content that blurs the lines between organic and sponsored posts.

Qoruz Vice President - Strategy & New Initiatives Jithin Sethumadhavan, highlights a key reason behind these violations, “Many influencers receive PR packages and affiliate commissions, which makes the distinction between personal content and brand-endorsed content murky. A skincare influencer sharing her daily routine or a tech influencer unboxing the latest iPhone may seem organic, even when a brand partnership exists.”

Fashion & Lifestyle (27.5%), Telecom Products (21.7%), and Personal Care (13%) emerged as the worst offenders.

A staggering 69% of India’s top 100 digital stars failed to meet advertising disclosure norms. The findings have raised red flags about the transparency of influencer marketing campaigns, urging brands, agencies, and influencers to take immediate corrective action to align with regulatory guidelines.

The study, conducted between September and November 2024, examined promotional content across Instagram and YouTube from influencers featured in Forbes India’s Top 100 Digital Stars list. These influencers, with a combined reach of over 110 million, play a critical role in shaping consumer choices.

However, the report found that non-compliance with ASCI and Central Consumer Protection Authority (CCPA) guidelines is rampant.

Out of 100 scrutinised influencer posts, 69% were found violating disclosure norms, with 56.8% of cases lacking any disclosure labels and 43.2% burying disclosures within hashtags, making them nearly invisible. While 93% of influencers compiled after intervention, five cases were escalated to the Ministry of Information & Broadcasting (MIB) for further action.

The Enforcement Gap and the “Fix It When Flagged” Mindset

Experts believe that the lack of strict enforcement is a major reason why influencer marketing continues to operate in a gray zone. While ASCI has processed over 6,000 cases since 2021, penalties for non-compliance remain insufficient to deter violations.

Karthik Srinivasan, a communications strategy consultant, who had earlier worked with Ogilvy underscores the importance of clear, prominent disclosures: “Social media is not a personal diary; it is a commercial space akin to newspapers and TV channels. Promotional content should be made obvious, not passed off as personal opinion.”

HashFame Co-founder Anirudh Sridharan points to the incentive-driven nature of influencer marketing: “Influencers don’t disclose ads because it hurts engagement. People trust authenticity, not ads. The algorithm punishes honesty. Without real consequences, rules become suggestions.” He further stresses that until brands and platforms are held equally accountable, the problem will persist.

Can AI Ensure Compliance?

With influencer marketing budgets growing, experts suggest that AI-driven tools could play a crucial role in ensuring compliance. Sethumadhavan notes that while platforms like Qoruz can track paid partnerships, India’s influencer marketing landscape isn’t mature enough for fully automated compliance enforcement.

“If execution happens entirely within a platform, compliance checks can be built-in. But top-tier influencers often operate independently, making automated enforcement challenging,” he explains.

With influencer marketing now a mainstream advertising channel, the industry faces a crossroads. ASCI CEO Manisha Kapoor urges stakeholders to take responsibility: “Brands should choose influencers who respect transparency. Influencers must push back against brands that ask them to flout regulations. This report should serve as a wake-up call.”

While regulatory enforcement is one solution, Sridharan believes that consumer awareness will ultimately drive change: “Consumers are getting smarter. If trust erodes, influence erodes. Over time, the best creators will realize that honesty is their most valuable currency. The rest? They’ll fade into irrelevance.”

With the ASCI report bringing the issue to the forefront, the message is clear: Influencer marketing needs to clean up its act before stricter regulations make non-compliance too costly to ignore.