Now Trending in Influencer Marketing: Sunday Riley Settles FTC Charges of Fake Reviews

October 29, 2019: October 29, 2019: Sunday Riley reaches settlement with FTC over fake reviews; Facebook releases news tab and angers everyone in the process; Instagram launches serial content for IGTV; Patrón sells tequila on Instagram; Cision gets acquired

Here’s what’s worth knowing this week:

Table of Contents

Sunday Scaries: Sunday Riley Reaches Settlement with FTC Over Fake Reviews

The Story

Last week, skincare brand Sunday Riley settled with the Federal Trade Commission (FTC) after the company was accused of posting fake reviews of its products on Sephora’s website for two years.

Omg… give me the deets.

According to the FTC, employees of the company were instructed to write fake reviews, dislike negative ones, and leave negative reviews on competitors’ products – all using VPNs so they wouldn’t be traced back to the company. Additionally, employees were told to write reviews that made them seem relatable, like “[knowing] how hard acne is and [trying] everything, and this one actually works.”

Who was the mastermind behind this scheme?

Ms. Riley herself. According to the FTC, “Rather than relying on satisfied customers to generate real buzz about her products, [Ms. Riley] directed her employees to write glowing reviews and bury negative ones, while offering detailed instructions on how to avoid detection.”

What was the settlement?

According to the terms of the settlement, Sunday Riley is not required to admit falsifying reviews. It must only commit to not doing so in the future – no refunds to customers, no profit forfeits, no admission of any wrongdoing. FTC commissioners Chopra and Slaughter openly disagreed with the statement, arguing that the company should have paid a higher price than a mere slap on the wrist: “going forward, the FTC should seek monetary consequences for fake review fraud, even if the exact level of ill-gotten gains is difficult to measure.”

STC POV

As cases of fraudulent reviews continue and consumers grow weary, the need for validated, verified reviews increases, as does the need for more oversight from retailers like Sephora. This case also highlights the ways that the FTC is fighting against fake ratings and reviews, case-by-case. What’s also notable is that the Sunday Riley news was first shared via Reddit (AKA: the front page of the internet), which then prompted the investigation.

For marketers executing influencer marketing programs, ratings and reviews can be a value-add opportunity (with proper disclosures if the product was gifted) to close the gap between consumers’ product discoveries and decisions to buy. By prompting influencers to submit product ratings and reviews after content creation, marketers will be able to better integrate consistent social proof at every touchpoint of the customer experience. However, in doing so, it’s important for marketers and influencers to responsibly source verified ratings and reviews, especially if supporting any product claims.

What’s the News with Facebook?

The Story

In the midst of Facebook’s public battle with U.S. presidential candidates, lawmakers, and civil rights groups over its stance on free speech, the platform is rolling out a standalone news tab called Facebook News.

First things first, what did Zuckerberg do this time?

TLDR; Zuckerberg wants everyone to have a voice on his platform, telling Congress that he will “fight to uphold as wide of a definition of freedom of expression as possible.” As part of that, Facebook released a controversial policy wherein the company pledged not to moderate politicians’ speech or fact-check their political ads because comments by political leaders, even if false, were newsworthy and in the public’s interest to hear and debate. With the 2020 election just around the corner, this hasn’t settled well with U.S. presidential candidates or Congress to say the least.

I also heard something about a new Facebook origin story?

Just in case Mark Zuckerberg didn’t anger enough people with his controversial policies, he decided to go one step further and create a new origin story for Facebook. When giving a speech at Georgetown University last week, Zuckerberg insisted Facebook was born out of the idea to give “everyone a voice” in the aftermath of the 2003 invasion of Iraq. The only problem? Facebook was developed on Zuckerberg’s creation of a “Hot or Not” site that rated Harvard students’ attractiveness and was initially only rolled out to the most powerful and elite universities. Give who a voice?

You mentioned a news tab?

Yes, we did. Last Friday, Facebook announced its plan to spend millions of dollars on high-quality journalism, starting with the launch of a new dedicated news tab and a standalone app. Designed with personalization in mind, users will be able to view the latest news by topic, hide sections or publications, or get a general news update. As part of this initiative, Facebook is partnering with a mixture of regional and national partners as “trusted sources,” which, controversially, includes Breitbart. The plot thickens…

STC POV

The million dollar question: WTF is going with Mark Zuckerberg?

As for the growing list of people Zuckerberg has pissed off, you can add Jack Dorsey to the list, who has outwardly expressed disagreement with Zuckerberg’s stance equating all kinds of free speech and has also judged Mark Revisionist Zuckerberg’s decision to seemingly rewrite Facebook’s origin story. I mean, who wouldn’t? When you’re trying to be authentic and transparent, revising history prob isn’t the move. Additionally, Facebook employees have grown increasingly upset over Zuckerberg’s decision to let politicians post any claims that they want – true or false – in ads on the site.

Instagram Now Offers Creators the Ability To Make Series

The Story

Instagram is now offering a Series option for creators built within IGTV.

What does this mean?

Influencers on Instagram can now create and share serialized content on IGTV. With new features, influencers can organize videos on a Series page and have a Series title appear on each video. Additionally, when fans and followers watch an episode from a Series, IGTV will automatically recommend the next episode. The best part? When a new Series is created, influencers have the ability to mass-blast their followers alerting them to the new content.

STC POV

Instagram’s latest Series option seems to directly rival that of Snapchat with its “Snap Originals.” However, with Instagram’s Series, the focus is on creators (unlike Snapchat, whose offering focuses on publishers, which, as of late, seems to be paying off for the platform). It will be interesting to see if this added feature continues to be creator-focused or if we will start to see Instagram begin to lean into publisher-created content in the same way that Snapchat has with its “Snap Originals.”

With Instagram finally leaning into long-form, serialized content, the groundwork is being set for the possibility of becoming a streaming platform for original, influencer-generated content (IGC) down the line. With the understanding that Instagram’s algorithm favors content that uses its new features, producing serialized content on IGTV presents a first-mover opportunity.

Brands can begin by thinking of Instagram Stories as IGTV pilots, using insights from high-performing Instagram stories as indicators of consumer interest and business value, first collaborating with creators to brainstorm and then rapidly testing ideas for longer-form programming. Additionally, marketers can begin incorporating multiple feedback loops by leveraging Instagram Stories and polls in tandem with IGTV programming to better understand consumers’ preferences.

It’s 5 O’Clock Somewhere: Tequila is Now Available for Purchase on Insta

The Story:

Patrón Tequila is now available for purchase through Instagram’s Swipe Up Feature.

Wait, I can buy alcohol on Insta now?

Yes! Well, sort of. Just Patrón Tequila as of now. The brand is the first alcohol brand to sell its product on Instagram. To purchase, users can swipe up to a checkout page, which will ask for their age, delivery information (to be fulfilled by Drizly, Instacart, or ReserveBar), and will be asked to show their ID in person when their order is delivered.

Tell me more!

Patrón has adjusted the way that it thinks about the continued growth of its business and the broader growth of spirit brands as it pertains to social media and e-commerce. By 2030, Patrón is hoping to make 20% of its revenue through e-commerce, with this initial Instagram integration being the first step of many toward reaching that goal.

STC POV

As a highly regulated industry, alcohol has been somewhat slower to move on meeting consumers where they are: online. With e-commerce only continuing to grow, Patrón is a great example of a first-mover brand that has broken through a highly regulated industry to provide a unique and convenient social media experience to its target consumers.

The inclusion of MikMak, the technology that makes Patrón and other brands shoppable on social media through immersive video content, brings up an interesting addition to the ways in which brands can connect with audiences through social video. As this technology is refined and more users adopt it, influencers and brands can use it to create a more seamless buying experience for shoppers.

Cision Gets Acquired as Falcon.IO Acquires Unmetric

The Story:

As Cision is set to be acquired by Platinum Equity Affiliate, its social media division, Falcon.io, has acquired Unmetric.

Start with the Platinum/Cision acquisition

Cision will be acquired by a Platinum Equity Affiliate for $2.74 billion. Platinum Equity is set to acquire all outstanding shares of the company. This news comes as Cision, over the past few years, has acquired competitor after competitor, which includes PR Newswire, Gorkana, and TrendKite.

Cool. On to the Falcon.IO/Unmetric deal

Falcon.IO (Cision’s social media division) will acquire Unmetric, a social listening tool specializing in benchmarking, content performance, and audience engagement. The plan is for the tool to be completely integrated into Falcon.IO’s social media platform, enabling customers to align brand experiences across multiple platforms.

STC POV

Cision continues to make major moves – especially in measurement – with the Unmetric acquisition. On the flip side, it will be interesting to see how Cision evolves by going private. With its acquisition by Platinum Equity and its history of acquiring tools and competitors to expand its capabilities (12 total – the world’s largest tech platform), Cision is quickly becoming a suite of tools for brands to optimize their advertisements and marketing strategies across platforms.