ASCI's new e-norms likely to hurt nano and micro influencers the most

Experts say the market is expected to shrink 20% because of the ASCI rules

The new guidelines pertaining to online influencer marketing by the Advertising Standards Council of India (ASCI) may hurt nano and micro influencers the most, said agencies working in the area.
 
The industry watchdog on Thursday had made it mandatory for online influencers to label promotional content.
 
Around 40 per cent of the Rs 1,200-crore online influencer market in India consists of nano and micro influencers. The balance 60 per cent consists of A-listers and prominent celebrities, who have a big fan following online.
 

The A-listers are expected to adapt quickly to the new norms, which may not be the case with nano influencers.

 
Neha Puri, CEO and founder, Vavo Digital, an influencer marketplace, said around 20 per cent of the segment could take a hit as a result of the ASCI rules, which will be implemented next month. “I see this as a temporary setback to nano and micro influencers. At a broader level, the rules will help build more authentic and credible associations among brands, influencers, and consumers,” she said.
 
Among categories that have been active with online influencers for a few years now include segments such as fashion, lifestyle, and beauty. However, the last one year has seen categories such as banking and financial services mark their presence firmly amongst online influencers, triggered in part by the Covid-19 pandemic, which has pushed up digital adoption among consumers.

 
Rajni Daswani, director, SoCheers, a digital marketing agency, said, “The rules are a good guardrail in the industry that has been unregulated so far. A lot though will depend on how influe­ncers and brands adapt to it. Many brands are averse to the whole #Ad and #Sponsored labels. They may start drawing parallel compared to paid media, which may see the investment in influencer marketing take a hit.” Influencers across the board have been asked to do due diligence on products and services they promote and ensure labels are put on all platforms where the promotional content appears. 
 

ASCI said in the case of online videos, labels have to appear for a certain period of time to ensure it is clear to consumers whether it is paid or not.
 
“We are launching the final guidelines that balance the interests of consumers, influencers, and advertisers,” Subhash Kamath, chairman, ASCI, said. 
 
According to experts, a distinction between paid and organic content was needed in an industry that was rapidly becoming mainstream.
 
To monitor social media platforms, ASCI has partnered French technology provider Reech, which will use artificial intelligence to scan digital content.
 
Complaints regarding breach of conduct by influencers will also be made part of the ASCI monthly complaint system, where the regulator discloses details about misleading ads across categories.