Every business needs to have an online presence. Many use a variety of different platforms to promote themselves in new and innovative ways.
However, some practices are certainly pushing the legal envelope. We look at a few examples below that have drawn attention.
What is it? Buying followers and retweets on Twitter
Is it a problem? Yes, in more ways than one.
Recently, various celebrities (and the Chinese Government) were revealed to have purchased a number of followers and retweets from a third party. The third party is thought to have been creating (or obtaining from someone else) various Twitter profiles operated as 'bots'. For all purposes a human appeared to be behind the account, as the profile picture and biographies were adapted from existing profiles. However, the accounts were no more than an algorithm which automatically followed and retweeted those who paid for the service.
The potential issues are serious. The conduct could involve identity theft and copyright infringement, by taking photographs and other information of human Twitter users and assuming them in a new profile. There is also the potential for the purchase of followers or retweets to constitute misleading and deceptive conduct, by representing that a person or business has more followers than they actually do. Apart from that, the person paying for the service risks having their account suspended or terminated.
What is it? Astroturfing
Is it a problem? It's legally questionable and definitely not a good look.
'Astroturfing' involves a business pushing their agenda through what appears to be a community initiative or grass roots movement. But it is fake. Think 'Citizens in favour of coal' being funded by a mining company. It can take a number of forms, from the creation of a 'front' policy group to paying individuals to surreptitiously advertise the business.
Depending on what is involved, astroturfing could amount to misleading or deceptive conduct under the Australian Consumer Law. Even if it does not, it's very hard to hide things on the internet; if someone were to find out who is behind the charade, there is a risk of substantial reputational damage.
What is it? 'masking' online reviews
Is it a problem? The Federal Court certainly think so.
In a case decided late last year, Meriton was alleged to have made sure that guests who were dissatisfied with their stay did not receive invitations from Trip Advisor to post online reviews. They did this by providing Trip Advisor with incorrect email addresses, or not providing any email addresses at all where there was a major service disruption at a particular property. The Court found that this constituted misleading or deceptive conduct, as it had the effect of restricting the number of negative guest reviews and therefore creating a more positive impression of Meriton properties. Implicit in this reasoning is that consumers should be able to rely on online reviews when considering whether to purchase goods or services. Meriton's penalty will likely be handed down in June this year.
What is it? Celebrity endorsements through social media
Is it a problem? Potentially.
It's very common for influencers to post about how much they like a certain product. In many cases it's clear there is a commercial arrangement behind the post. But whether the post is an advertisement or not is sometimes unclear. In many ways, this involves the same conduct as the 'cash for comment' radio saga from the early 2000s, just in a different medium.
The Australian Association of National Advertisers has recently published guidelines on this issue. The guidelines emphasise that consumers need to be made aware of material that is made for the purpose of marketing, with the key being how much control the business has over the content. If it is not clear that the post is really an advertisement (rather than an unpaid and 'organic' endorsement), both the person making the post and the business who arranged it could be liable for misleading or deceptive conduct in breach of the Australian Consumer Law.
These are just a few of the risks that businesses face when attempting to enhance their online profile. We recommend that all businesses, large and small, think carefully about their potential exposure. Our advice? Don't pretend to be something (or someone) you are not.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
