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Social media endorsement: Trends and risks

17 July 2013 | 12:30 am


Bollywood actress, Priyanka Chapra, is close to signing a contract with an Indian health portal for endorsing its services to her 4.2 million Twitter followers.

Other ‘celebrities’ in India, like their counterparts in the West, have already signed social media deals with brands or are getting paid to extra for tweeting about brands and marketing companies are pursuing the social media hot-list to tie up endorsement deals.

Bunty Sajdeh, CEO, Cornerstone Sport and Entertainment said in a recent interview: "Twitter is a very big aspect of a celeb's reach. Sponsored tweets are certainly gaining traction in India."

Brands are spending up to 25% of their endorsement budget on the social media and the websites of celebrities and sport stars.

Though it seems that social media celebrity endorsement is starting to draw the attention of federal officials in the US.

Mary K. Engle, associate director of the advertising practices division at the FTC said: “In a traditional ad with a celebrity, everyone assumes that they are being paid. When it’s not obvious that it is an ad, people should disclose that they are being paid.”

Oliver Sweeney, social media expert at law firm Browne Jacobson said: “Brand ambassadors can also land a business directly in trouble by breaching advertising regulations on your behalf”

Brands are also running the risk that while the celebrity is tied to the brand anything they say or do on social media will reflect on the brand and will put them at risk of reputation damage.

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