Regulation of Advertising and Sponsored Content on Instagram

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MA New Media and Digital Culture

Regulation of Advertising and Sponsored Content on Instagram

‘Official advertising’ by businesses and ‘unofficial advertising’ by influencers

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Abstract

Instagram is evolving towards an advertising platform. More and more advertisers find their way to the platform, which leads to the occurrence of ‘official advertising’ and ‘unofficial advertising’ on Instagram. Especially ‘unofficial advertising’, which comes forward in sponsored content by influencers, is still a grey zone in terms of regulation. By analysing two empirical cases, which are 1. the analysis of Instagram’s advertising features and 2. a hashtag analysis, this study seeks to find out what kind of advertising Instagram affords, and how this is regulated by the platform itself and by regulatory bodies. Hence, this study sets a method for studying this phenomenon empirically and offers a basis for regulators to study how people (and/or users) handle regulation. ‘Official advertising’ on Instagram is a regulated zone on the platform. Instagram regulates by taking advertisers as a different category, that have certain functions and possibilities. ‘Unofficial advertising’ is advertising is done through sponsored content by influencers, who are ‘normal people’ that are paid by businesses to post on their account. Regulation of ‘unofficial advertising’ is captured by regulatory institutions, and influencers themselves. The role of the social network is important here, because the profits of sponsored content depends on the following base of an influencer. In practice, influencers are self-regulating. They are using Instagram in their own way and are not always following the rules and regulation of the regulatory institutions. Because the regulation of sponsored content on Instagram is grey zone, influencers are forming their own ways of dealing with sponsored content and use for example ‘tagging’ to clarify on sponsored content. To ensure that influencers all use the same guidelines for sponsored content it would be useful if Instagram would set up rules for ‘unofficial advertising’.

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1. Introduction

1.1. Instagram

Instagram launched on October 6, 2010 (“The Complete History of Instagram”) and is a social media platform which makes it possible for users to capture moments and to share these with the world. Or, as Instagram describes itself on its website:

Instagram is a fun and quirky way to share your life with friends through a series of pictures. Snap a photo with your mobile phone, then choose a filter to transform the image into a memory to keep around forever. We're

building Instagram to allow you to experience moments in your friends' lives through pictures as they happen. We imagine a world more connected through photos (“Instagram”).

Users can create a profile and follow friends, family and other accounts to stay up to date on topics of their interest. Users can post photos and videos on their profile, edit them with filters, creative tools and can combine multiple clips into a single video. Recently, Instagram also made it possible for users to upload photos and videos to their ‘story’. These stories disappear after 24 hours and are not presented on someone’s profile (“Instagram”). Instagram has over 600 million monthly active users worldwide, being one of the most popular social networks worldwide (Statista, “Instagram Monthly Active Users 2016 | Statistic”).

Carah and Shaul, who conceptualize Instagram as an “image machine,” state that it “harnesses the continuous and habitual use of mobile devices to scroll, tap, and glance at a never-ending flow of images” (70). They argue that Instagram captures and calibrates attention (69) and connects image machines with brand activities. They state that platforms like Instagram “are engaged in an iterative and experimental process of designing devices like advertising tools, data analytics, and algorithms for calibrating attention” (83). The aspect of attention is connected to advertising. Advertising, according to Starch, is about attracting attention to goods. Thus, attention and advertising are connected in a way in which it is advertising’s purpose to gain people their attention. Therefore, as Instagram captures and calibrates attention (Carah and Shaul 69), it can function as a platform for brands to advertise their goods.

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Instagram can be seen as a social media platform. According to Laroche, Habibi, and Richard, social media is a generic name for communication channels that allow its users to communicate directly with other users through, for example, texts, images or sounds. They argue that content on social media platforms is actively generated, consumed and shared by its users (77).

According to Tarleton Gillespie, the concept ‘platform’ has many different meanings and focuses on multiple audiences: end users, advertisers and professional content producers. A platform offers advertisers a way to reach consumers, build brand awareness and launch a campaign or product. Platforms also offer content producers a way to share content, and it creates a way for people to speak out, giving them a public voice (Gillespie 335). The platform Instagram is not only used by end-users for creating and sharing photos and videos but also by various actors for advertising, as explained in the next paragraph.

1.1.1. Instagram for advertising

Instagram is increasingly becoming an advertising platform. According to Aslam, Instagram is expected to generate about $1.5 billion in mobile advertising sales this year (2017) and $5 billion in 2018. He also states that Instagram is globally used by 48,8% of all brands and that number is expected to rise to 70,7% by 2017. Advertising on Instagram is a way of social media advertising, which is further discussed in section 2.1.3. The way in which Instagram is evolving towards the advertising industry makes it an interesting object to study. Especially, because there are two different kinds of advertising occurring on the platform, which I will call ‘official advertising’, and ‘unofficial advertising’.

With official advertising I mean the classic form of advertising, which the Oxford dictionary defines as: “the activity or profession of producing advertisements for commercial products or services” (“Advertising - Definition of Advertising in English | Oxford

Dictionaries”). Exemplified: an advertiser places an ad on a platform at a certain price, depending on the reach and relevance of the people reached. The practice of advertising can occur in many ways, but not everything is allowed by platforms. To keep advertising in control, platforms have responded to it with certain rules and regulations. These rules and regulations indicate the limits advertisers need to adhere to.

Unofficial advertising is used to indicate a new form of advertising, which is the use of so-called ‘influencers’ on social media platforms, like Instagram. Influencers are hired by companies to post sponsored content on their accounts and receive a certain amount of money

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per post. This form of advertising has been introduced recently and there is still no clear form of regulation for it. According to Aslam, Instagram influencers are charging up to $100,000 for a sponsored post. The next paragraph will clarify on the problematic of different forms of advertising on Instagram.

1.2. Advertising on Instagram

Advertising occurs on Instagram in various ways, which can be divided in ‘official

advertising’ and ‘unofficial advertising’. The first way of advertising, ‘official advertising’, is increasingly regulated in a clear way by Instagram (as will be demonstrated in section 2.4), but there is not much known about the new ‘unofficial advertising’ on Instagram. The use of influencers for sponsored content is such a new phenomenon, that there are no regulations for platforms to deal with it. Although Instagram has been introducing many new features for ‘official advertisers’ to advertise, there is no system of regulation in place for ‘unofficial advertising’.

The use of sponsored content on Instagram is regulated in different ways, by different parties, which do not seem to accord. Regulation by institutions, regulation by Instagram and regulation by users (influencers) themselves take place in different ways.

Over the years, Instagram has introduced several new features for ‘official advertisers’, but so far , it has not taken influencer advertising into account. Though, regulatory institutions FTC and SRC have listed certain hashtags that should be used by influencers to point out sponsored content on social media platforms like Instagram. The hashtags they have listed on their websites are: #spon, #sponsored, #sp, #ad, #paid, #sample, #gesponsord, #adv and #prom (“FTC Social Media Guidelines For 2016”) and (“Stichting Reclame Code: Reclamecode Social Media (RSM)”). These hashtags should be used to point out that certain content is not shared by oneself, but is paid for by a third party. Thus, one can recognize it as advertising. Although the regulatory institutions came up with these hashtags to indicate sponsored content, in practice, users also use other hashtags and mechanism to point out sponsored content differently. For that reason, this study wants to examine how the platform deals with both ‘official advertising’ and sponsored content on Instagram by

influencers, which will be called ‘unofficial advertising’. The next paragraph will explain how this research will examine these practices.

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1.3. Regulation of advertising on Instagram

By discussing the various types of advertising that occur on the platform Instagram, the aim of this research is to gain more insights into the ways Instagram and the advertising industry regulate the use of advertising and sponsored content on the platform. To do so, I will

examine both ‘official advertising’ as well as ‘unofficial advertising’ on Instagram. This leads to the following research question: What kind of advertising does Instagram afford, and how is this regulated by the platform itself and by regulatory bodies? In this way, an understanding of platform regulation in relation to advertising on Instagram will be constructed.

The research will be split into two different parts, which together give answer to the research question. The first question concerns how Instagram regulates ‘official advertising’, and the second question addresses how Instagram regulates ‘unofficial advertising’ and how

influencers deal with it. Therefore, the following sub questions are being asked:

1. What does the platform Instagram afford to advertisers?

2. How does Instagram regulate sponsored content by influencers, and how do influencers deal with sponsored content on the platform?

Thus, to give an answer to the research question, the two different kinds of advertising are being distinguished throughout this whole research. Together they cover the main ways of advertising on Instagram.

1.4. Significance of the study

The phenomenon of influencers is understudied. Different scholars studied sponsored content by influencers, but from another perspective, which is, the angle of self-branding. For

example Hearn and Schoenhoff, who argue that a social media influencer (SMI) is not just there, but is produced by all kinds of analytics (followers, likes). She states: “Like the

celebrity, the SMI is produced, not born; he or she is identified and constituted by a variety of social media intelligence analytics and social scoring companies, such as Klout and

peerindex” 194.

Very few empirical studies have been conducted on the use of sponsored content on Instagram. Moreover , there is almost no research performed on influencers, and zero on the use of hashtags for pointing out sponsored content. Therefore, with this thesis, I contribute to

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theory on regulation of the advertising industry on the platform Instagram, by empirically investigating the phenomenon. Thus, from the angle of influencers that deal with sponsored content. By studying this phenomenon, this research reflects on advertising on Instagram and in which forms it appears, but also on how people and/or advertisers try to find a way to deal with the platform as an advertising platform. This empirical study contributes knowledge of this subject, which is knowledge on practices of influencers that deal with sponsored content. These insights on influencers can form the basis for regulation and other discussions. The empirical findings, a small dataset, I set a method for studying this phenomenon empirically.

1.4.1. Empirical cases

The two empirical cases this study contains, are: 1. An analysis of the evolution of advertising on Instagram to study ‘official advertising’ on Instagram. To do so, a timeline of introduction of features on Instagram is used to examine how Instagram has evolved towards an

advertising platform. 2. A hashtag analysis to learn about ‘unofficial advertising’ on

Instagram, which exists of the analysis of posts by influencers in The Netherlands to examine how influencers deal with sponsored content in practice. The study also contains a co-hashtag analysis of hashtags used to point out sponsored content, to learn more about related hashtags.

1.5. Overview of the Study

In the first part of my study I provide an overview of advertising, what is further subdivided into online advertising and social media advertising. These forms of advertising are all ‘official advertising’. In discussing ‘unofficial advertising’ next, I focus on influencer marketing, which arose from the increasing use of social media and works through sponsored content. Also, regulation of ‘official- and unofficial advertising’ on platforms, specifically Instagram, are discussed. In case of ‘unofficial advertising’, regulation on Instagram is done by different parties: the platform itself, regulatory institutions FTC and SRC and influencers themselves.

In the next chapter, I will explain the methodology used to answer the research

question and explain which steps are taken in order to conduct the analysis of this study. This study examines what influencers are and which possibilities the platform Instagram offers, what will be empirically researched by two case studies.

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In chapter four and five I present two analyses: Chapter 4. The first analysis concerns ‘official advertising’, which exists of an analysis of a timeline that shows the evolution of Instagram towards an advertising platform. Instagram’s developments are divided into three categories, which are: integrating businesses as specific user type, new ad features, and new ways to organize advertising. By introducing more and more advertising features, Instagram increasingly has become interesting for advertisers. Chapter 5. The second analysis focuses on ‘unofficial advertising’ and contains a hashtag analysis of popular influencers in The

Netherlands. Here, it becomes apparent that influencers come up with different manners to point out sponsored content than listed by regulatory institutions, for example, by the use of the feature tagging. Also, some influencers do not clarify on sponsored content at all.

Furthermore, a co-hashtag analysis of hashtags used to point out sponsored content is done to examine semantic structures of related hashtags used to point out sponsored content. Hashtags are often used in different contexts and some of the hashtags indicate a particular community.

The last chapter, discussion and conclusion, discusses all major findings and will, conclude on all above by concluding on ‘official advertising’ and ‘unofficial advertising’ on Instagram and the ways in which these forms of advertising are regulated.

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2. Literature review

This chapter presents existing literature on the topics of advertising, influencers, sponsored content, regulation and hashtags. As already explained in the introduction, this research distinguishes between two types of advertising, which are ‘official advertising’ and ‘unofficial advertising’. The literature review will be divided into the main topics: advertising,

influencers and regulation, after which regulation of ‘official advertising’ and regulation of ‘unofficial advertising’ will be discussed.

2.1. Advertising

Advertising is already a very old practice. In September 1874, H. Sampson published a book called A history of advertising. He discusses topics such as ancient and medieval advertising, seventeenth and eighteenth-century advertising. In his book, Sampson argues that the first advertisement was published no more than two hundred years ago (written in 1874) (19) in the form of a newspaper advertisement. Although there are no instances of business notices appearing in papers before the middle of the seventeenth century to find, mainly because there were no papers in which to advertise, Sampson stresses that there is little doubt that the desire among tradesmen and merchants to make good their wares has had an existence almost as long as the customs of buying and selling. Therefore, he argues that “it is but natural to suppose that advertisements in some shape or form have existed not only from time

immemorial, but almost for all time” (19). He exemplifies this by pointing out that signs over shops and stalls seem naturally to have been the first efforts in the direction of advertisements, and that they go back to the remotest portions of the world’s history (Sampson 19). In his book, it becomes evident that Sampson believes advertising can come in various

manifestations, for example by writing or by word of mouth. (20 & 21). Different definitions of advertising occur in theory, some of which are highlighted in the following paragraph.

2.1.1. Definitions of advertising

Advertising already exists for a long time, but what is meant by the practice advertising? What is the definition of advertising, and has it always been like this?

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Over the years, advertising has been defined variously in theory. In one of the first books on advertising in 1910, Daniel Starch argues that advertising may provisionally be defined as “calling the attention of people to a commodity, and inducing them to buy the commodity. He also cites another definition and the aim: “Advertising is salesmanship on paper,” and “the aim of advertising is to attract attention and to sell goods.” In his stated definitions, the central role of attention clearly emerges. Starch states that it is obvious that advertising consists of persuading the public, usually through print, to do certain things. As such, it is an appeal to the minds of people (Starch 9). Starch’s definition is primarily focused on print, which makes sense because it was ‘the’ medium in that time. Nowadays, with a wider range of media, this definition is not comprehensive enough to define advertising. In essence, advertising is still about attracting attention and selling goods. Merely the way attention is drawn to the goods has changed due to new forms of media. Starch also stresses the persuasive aspect, what is also done by Jef I. Richards and Catharine M. Curran.

The study of Richards and Curran focuses on the various definitions of advertising. After studying different recent marketing and advertising textbooks, they argue there is no widely adopted definition at this time (study from 2013) (64). Though, the study samples a list of definitions presented in advertising and marketing textbooks and states that however each definition is different, they all have certain recurring elements. Using those elements,

Richards and Curran present a prototypical definition: “Advertising is a paid non-personal communication from an identified sponsor, using mass media to persuade or influence an audience” (64). Although this definition captures the essence of previous definitions and emphasizes the persuasive aspect like Starch did, it does not consider the personal aspect of advertising when making use of the internet.

A completely different definition of advertising comes from Micael Dahlen and Sara Rosengren, who emphasize ‘impact’. Their study on the definition of advertising identifies three dynamics – (new) media and formats, (new) “consumer” behaviours, and extended effects of advertising - that drive the evolution of advertising (334).

Keeping the dynamics in mind, their updated definition of advertising is formulated as follows: “brand-initiated communication intent on impacting people” (Dahlen and Rosengren 334).

The term ‘impact’ is used to take some action, because Dahlen and Rosengren believe it suggests a traditional sender-receiver process where the brand pushes the advertising forward and is the sole designer of the message (338). Dahlen and Rosengren’s definition is

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very broad, though it captures the various elements advertising comprehends. However, the definition can let one wonder what is specifically meant by the term ‘impact’.

Although various studies define advertising in a different way, all scholars seem to agree that advertising is some form of communication which is used to have a certain effect on people. Drawing from the definitions provided above, this effect is either ‘taking action’ or ‘buying’ (as a specific form of action).

A major development in the world of advertising is the rise of online advertising. The next paragraph will discuss online advertising more extensively.

2.1.2. Online advertising

The introduction of the Internet made the advertising industry change towards online

advertising. “The last decade has seen a clear shift from traditional advertising towards online marketing efforts that extend across numerous portals and platforms” (Johnson 13). The industry responds to this shift, but what is online advertising, and in what way is it different than “normal” advertising?

One of the first articles on online advertising was published in 1996 by Berthon, Pitt and Watson. Their article ‘Marketing communication and the world wide web’ uses a metaphor to explain how the Web can be used for marketing purposes: “It might be useful to think of the Web as a cross between an electronic trade show and a community flea market. As an

electronic trade show, it resembles a giant international exhibition hall where potential buyers can enter at will and visit prospective sellers” (25). A metaphor that is still applicable,

creating a clear image of what the online advertising industry is about. Also, Berthon Pitt and Watson state that online advertising is more efficient on several fronts (like awareness, contact and conversion) and they present some key elements that Web marketers can use to measure effectiveness. Those elements are the number of surfers, the number of hits, the number of aware surfers, the number of active visitors and the number of purchases and repurchases (Berthon, Pitt, and Watson 29). The ideas Berthon, Pitt and Watson presented in 1996 are still represented in online advertising nowadays. The elements Berthon, Pitt and Watson present are the early web metrics, but there are now a billion more metrics that are used such as Facebook likes (Gerlitz and Helmond 1358). In addition, a very big change is that with the rise of social networks, social media ads can now be attached to a user profile

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(1353). Thus, another form of advertising arises, which is social media advertising. The next paragraph goes deeper into the subject of social media advertising and the aspect of social.

2.1.3. Social media advertising

According to Bakshy et al. “social advertising uses information about consumers' peers, including peer affiliations with a brand, product, organization, etc., to target ads and

contextualize their display” (146). They state that the approach described above increases the ad efficacy for two reasons. Firstly, “peers' affiliations reflect unobserved consumer

characteristics, which are correlated along the social network” (146). Secondly, because “the inclusion of social cues (i.e., peers' association with a brand) alongside ads affect responses via social influence processes” (146). Therefore, responses will increase if multiple social signs are used, and if ads are affiliated with peers with strong ties.

Also, according to Li, Lee, and Lien, “online advertising is the main business model for social networking sites” (119). In their article, they propose a social endorser-based advertising system formulated on network influence and user preference analyses.

Experiments show that their mechanism significantly improves advertising effectiveness and efficiency. Thus, by utilizing social network and user preference analysis techniques, the theories of dynamic social influence and celebrity endorsement are realized and outperform other advertising approached (119).

Fisher looks at social media advertising from another perspective than Bakshy et al. and Li, Lee and Lien. He states that social media users produce data, which is commodified by social media companies. He brings up the Facebook’s Sponsored Stories as an example of ads rendered from naturally occurring users’ communication. Also, Fisher argues that value generated by users on social media platforms is based on two additional types of labour: “the ‘self’ of users, who are mobilized as ‘celebrity’ avatars to advertise a brand, and the

construction and maintenance of networks, or media channels through which ads are disseminated” (50).

Especially the aspect of social plays a huge role at social media advertising, e.g. the connections/friendships with other people can be leveraged. Also, the aspect of social plays an important role in the way influencer marketing works, which will be discussed in the

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2.2. Influencer marketing

Beyond the official ways of advertising on the Instagram platform that have been discussed in the previous section, next I will address the unofficial ways of advertising by so-called

‘influencers’.

2.2.1. Influencers

Influencers are social media users that have an influence on their target audience. An influencer is someone who has a wide or strong reach online and knows to activate the right target audience (Daalder). According to Forbes, more and more brands and retailers are “turning towards influencers as major marketing channels” (Weinswig). The way influencers operate is as follows: a business sponsors an influencer with its product(s) where after the influencer posts (in the case of Instagram) a picture on his or her account with the product, or naming the product or brand. Influencers have a huge number of followers and thus reach many people with their posts, what makes them interesting for businesses to advertise their products. Businesses pay influencers an amount of money for each post, which sometimes reaches up to enormous amounts. Like Bakshy et al. state on social media advertising, influencers increase ads efficacy because “peers' affiliations reflect unobserved consumer characteristics, which are correlated along the social network” (146). Also Fishers’ argument about value generation by users comes forward with influencers, for example, which can be seen as “avatars to advertise a brand” (50).

Not many scholars have defined the phenomenon of influencers. Though, some definitions can be found, including that of Crystal Abidin who defines influencers as follows: “Influencers are every day, ordinary Internet users who accumulate a relatively large

following on blogs and social media through the textual and visual narration of their personal lives and lifestyles, engage with their following in digital and physical spaces, and monetise their following by integrating “advertorials” into their blog or social media posts. A

portmanteau of “advertisement” and “editorial”, advertorials in the Influencer industry are highly personalised, opinion-laden promotions of products/services that influencers personally experience and endorse for a fee” (Abidin).

Like Weiss, who appoints that everyone can become an influencer, Abidin writes that influencers can be ‘every day, ordinary Internet users’. Thus, in their opinions influencers can be anyone. This aspect also comes forward in the definition that Berry and Keller come up with on influencers, in which they speak of ‘everyday consumers’.

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Jon Berry and Ed Keller have been studying influencers for over two decades and wrote the book “The Influentials”. Berry and Keller define influencers as: “everyday

consumers who are substantially more likely than the average to seek out information and to share ideas, information, and recommendations with other people”. Berry, Fay and Keller stress that this definition is important because the term influencer is often used without much precision and has been used to describe high-profile celebrities, fashion designers, inventors, even politicians (2). Thus, according to Berry and Keller, influencers are regular people. Their study shows that “consumers consider the word of mouth of friends, family, and others to be the best source of advice and information – these “everyday influencers” are central to consumer decision-making” (Keller, Fay, and Berry 2).

Also, Booth and Matic join Weiss, Abidin and Berry and Keller in their opinions on influencers as ‘normal people’ by arguing that influencers are wielding significant power over the perceptions of brands and companies, largely driven by the rapid expansion of social media channels through which influencers communicate. They state: “The “nobodies” of the past are now the new “somebodies” demanding the attention of communication professionals who seek continuous engagement with targeted consumers throughout the various channels of the social web” (Booth and Matic 184).

According to various definitions from theory, influencers are ‘normal people’ who share certain ideas with a wide audience. Influencers can be seen as a method in which word of mouth is distributed online.

Influencer marketing is a way for businesses to create a certain effect. According to Berry and Keller, marketers should be interested in influencers, as they reach over twice as many people through word of mouth as the average consumer. Which means that marketers can

substantially increase the return on their marketing dollar by focusing on them. “They have the means, the opportunity, and the motive to spread messages further” (12).

Rick Ferguson compares word of mouth with viral marketing. He argues that “The difference between viral marketing and WOM is one of cause and effect. Viral marketing – which might take the form of influencer marketing programs, community-building portals, viral videos and street-level guerrilla campaigns – builds awareness and buzz; it’s the cause. Positive WOM, which theoretically leads to trial and acquisition, is the effect” (Ferguson 180). Weiss sees word of mouth as the origin of influencers, as will be described in the next paragraph.

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2.2.2. Origin Influencer marketing

In her study ‘Influencer Marketing’, Rhoda Weiss writes about word of mouth marketing as the origin of influencer marketing. She argues that modern marketing started a long time ago with the phenomenon of word of mouth (WOM) marketing. Oral histories, fables songs and fairy tales were shared through generations for centuries, long before the written word (Weiss 16). Weiss argues that “while those with influence and celebrity can hold sway over the hearts and minds of fans and followers, the popularity of WOM allows everyone to become

influencers” (16). WOM marketing is the most trusted source of consumer information and the likeliest to be acted upon. Also, WOM marketing is amplified by the Internet and social media. By creating WOM strategies, brands ensure that consumers are influenced by the right people who test, try and share their experiences that shape and form relationships that

organizations are hoping to achieve (16).

One way to implement a WOM strategy is by using social media. Social media platforms are an easy way to reach a great amount of people at once. To understand the phenomenon better, the following paragraph discusses influencer marketing on social media.

2.2.3. Influencer marketing on social media

Caused by the increasing amount of social media users1, influencers are using social media channels for word of mouth because of the huge reach possibilities.

According to Booth and Matic, “consumers are now the individuals broadcasting personal or second-hand stories to their social networks and the world. They are a brand’s storytellers and the new brand ambassadors” (Booth and Matic 185). Important here, is to take into account that the term ‘broadcasting’ has a connotation of reaching ‘everyone’, while it could also be seen as a form of ‘narrowcasting’ with reaching followers (“Broadcast - Definition of Broadcast in English | Oxford Dictionaries”). Also, they created a list of variables to

determine a numeric rank of bloggers’ influence, which are the following variables (and what they mean) (186):

- Viewers per month (vpm). The number of visits to the blog per month. - Linkages. The popularity of blog post links inbound and outbound. - Post frequency. Volume of posts per given time.

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Number of active users per social media platform (in millions): Facebook: 1.968, YouTube: 1.200, Instagram: 600 and Twitter: 319 (Statista, “Global Social Media Ranking 2017 | Statistic”).

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- Media citation score. Volume and level of media that cites blogger.

- Industry score. Number of industry guru points based on industry events such as key notes, bylines and panel participation.

- Social aggregator rate. Level of participation in the social web (e.g. Twitter, other bloggers/blog communities, LinkedIn, etc.).

- Engagement index. Reader response and the quantity of comments.

- Subject/topic-related posts. Volume and immediacy of subject/topic-related posts. - Qualitative subject/topic-related posts. Qualitative review of subject/topic-related

posts.

- Index score. Identification and rank of influencer in the social web based on above variables.

Using these variables, influence becomes measurable. The ability to measure influence is also performed to construct the influencer engagement index. Using different variables to measure influence, the index ranks influencers in The Netherlands, which is discussed next.

2.2.5. Influencer Engagement Index

The influencer engagement index is an initiative of Social Inc., a social media and brand publishing bureau. The index is a ranking of the most popular influencers in The Netherlands, which is created to construct a clear overview of all Dutch influencers active on Instagram. The ranking includes the name, the amount of interactions, the number of followers, the amount of posts, the amount of posts on hashtags and category the influencer belongs to. The index is renewed on weekly basis (“Influencer Engagement Index: Dé Ranglijst van

Influencers in Nederland Op Instagram”). The influencer engagement index can be helpful for businesses to decide on which influencers are the most suitable for their brand to collaborate with.

Some of the influencers listed in the influencer engagement index earn money by posting sponsored content on their account. The following paragraph discusses this practice.

2.2.6. Sponsored content

The way brands use influencers on Instagram is by the using sponsored content. Sponsored content is defined as the integration of commercial messages into traditionally

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marketing, covert marketing, branded content, product placement or native advertising (Boerman and van Reijmersdal 3). Boerman and van Reijmersdal define branded content as “the purposeful integration of brands or branded persuasive messages into editorial media content in exchange for compensation from a sponsor” (3). The question that can be asked here: is an Instagram post editorial content? In many cases an Instagram post is editorial, but in case of influencers not always. In their article, Boerman and van Reijmersdal argue that by using this form of advertisement, the lines between editorial and commercial content are faded, it hides the commercial stakes and makes that consumers are not aware of the fact that the content they are using can be recognised as persuasive (Boerman and van Reijmersdal 3).

2.3. Regulation and regulatory bodies

2.3.1. Regulation by platforms

Tarleton Gillespie defines platforms as “sites and services that host public expression, store it on and serve it up from the cloud, organize access to it through search and recommendation, or install it onto mobile devices” (Gillespie 1). He argues that the key feature of platforms is that they host and organize user content for public circulation without having produced or commissioned it. Users make decisions about content and interact with it (1).

Platforms regulate users and other stakeholders such as advertisers differently. Certain things are possible, and some are not. But what is exactly meant by regulation? Business Dictionary gives the following definition of regulation: “General: Principle or rule (with or without the coercive power of law) employed in controlling, directing, or managing an activity, organization, or system” (“What Is a Regulation?”). Therefore, regulation by platforms is about which rules the platform handles, how users are directed, controlled and how activities are managed.

According to Gillespie, regulation by platforms is about how they govern. Mostly, how they govern their own rules, which often go further than the law requires (12). Platforms police content for offensiveness and other inappropriate behaviour of users, after which content can be deleted or accounts can be blocked. Regulation is mainly done for economic reasons, but also because users would probably leave the platform when it’s filled with offensive or pornographic content (Gillespie 13).

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Every platform deals differently with unwanted content and the corresponding consequences. However, Gillespie argues, when looking at guidelines of different platforms, they develop their rules not in anticipation of inappropriate content, but in response to it (14). Sarah T. Roberts’ study shows that big social media platforms use CCM (Commercial

Content Moderation) workers to “curate site content and guard against serious infractions contained in user-generated content (UGC) that might do harm to a social media platform or a company’s digital presence” (Roberts 1). Though there are specialized teams to judge if content is violating any rules and if content can stay online, it is not the only way for platforms to regulate. Also, the online user community can help in policing the platform policy. Platforms can ask users to flag problematic content and behaviour, after it will be reviewed by the team of moderators. Next to that, users can use a tool for rating or blocking content which makes it possible to put the content out of sight (Gillespie 18). It is relevant to advertising in a way that advertisers should think about regulation on platforms. They cannot just do everything, but should keep platform regulation in mind. The next part will discuss regulation on the platform Instagram.

2.3.2. Regulation on Instagram

Instagram does regulate on content and polices content for offensiveness and inappropriate behaviours of users and content could be deleted. One known example is that of

#freethenipple. Users cannot post photos that contain a woman’s nipple, but photos in which a man’s nipple can be seen is allowed by Instagram. According to Instagram, woman’s nipples are sexually tinted and thus will be removed from the platform (“Instagram Legt Uit Waarom #freethenipple Nooit Gaat Gebeuren”).

Also, Instagram offers users the possibility to report posts as ‘spam’ or ‘inappropriate’. When a user reports a post or account, only Instagram receives a notification of it

(“Instagram-Helpcentrum”).

2.4. Regulation of ‘official advertising’

The following sections discuss how Instagram functions as an advertising platform. What is possible for advertisers and how does it work.

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2.4.1 Advertising on Instagram

Since the beginning of Instagram, it involved interactions between people who follow each other, post comments and like each other’s photos and create hashtags for grouping images. Also brands were participating. Initially, brands were regular users on Instagram, one had to judge for themselves if they were dealing with a brand or company. Starting in 2014,

Instagram began with promoted posts in users’ feeds and started to offer analytics to brands (Carah and Shaul 73).

From then on, businesses could place ads on the platform. Instagram offers three various types of ads. Firstly, photo ads, which are the simplest type. With a photo ad, a business can post a photo just like every other user on the platform. Secondly, one can choose to place a carrousel ad, this type offers Instagram users to swipe through multiple images, making it possible to communicate on more than one product. Lastly, video ads can be placed. This type offers the possibility to place a video as an ad, these videos have a maximum of thirty

seconds. Besides the various types of ads, businesses can add ‘call to action’ buttons to their ads, which are the following to choose from (Groenhof):

- More information - View more - Shop now - Book now - Register - Contact us

See Figure 1, the third screenshot shows the call to action options advertisers can choose from.

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Figure 1. Screenshots of creating an Instagram ad

As can also be seen in Figure 1 (second screenshot), Instagram ads make it possible to reach specific target audiences based on the interests and various demographical data with the feature ‘make your own target audience’. Country, age and gender are mandatory targeting options.

To monitor the effects of their ads, Instagram offers advertisers the button ‘view statistics’ (see Figure 2). The statistics show the number of likes, the number of reactions, how many times someone saved the post, the number of views, reach of the post and how many people engaged with the post.

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Figure 2. Screenshot of Instagram ad statistics

Four years ago, Instagram introduced a new tool which makes it possible for advertisers to tag a partner in Instagram posts (Flynn). The tagging tool appears below the ‘tag people’ when creating a post and offers the possibility to name a partner. The feature “comes after years of advertising watchdogs and lobbying groups being frustrated about the lack of a clear policy or rules for so-called branded content on the app” (Flynn). Although the feature offers a solution for many advertisers, Instagram has not introduced it globally yet. For example, it does not appear on Instagram in the Netherlands. Figure 3 shows a screenshot of Moshe Isaacian, who noticed that in the United States of America the feature ‘add partner’ was added to Instagram. The figure also shows an own screenshot of Instagram in The Netherlands, in which can be seen that only people can be tagged.

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Figure 3. Screenshot of ‘tag people’ and ‘add partner’

Screenshot of Moshe Isaacian (Moshe). Screenshot of Dutch Instagram

2.5. Regulation of ‘unofficial advertising’

2.5.1. Regulation for sponsored content with the use of hashtags

This section will discuss several institutions that regulate sponsored content on social media. These institutions are the FTC and the SRC.

2.5.2. Federal Trade Commission

The Federal Trade Commission (FTC) is a bipartisan federal agency in the United States of America that protects consumers and promote competition. “For one hundred years, our collegial and consensus-driven agency has championed the interests of American consumers. As we begin our second century, the FTC is dedicated to advancing consumer interests while encouraging innovation and competition in our dynamic economy”. They develop policies and research tools and collaborates with law enforcement partners globally to advance

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consumer protection and competition in the marketplace (“What We Do | Federal Trade Commission”).

In the United States of America, the FTC ensures that those who spread sponsored content disclose it on every social media platform. Only the hashtags #ad and #sponsored are accepted by the FTC (“The 3 Golden Rules To Sponsored Content Disclosures – With Picture Examples – Markerly Blog”). Also, the FTC also states that hashtags do not constitute proper disclosure. Sponsored content on Instagram “should clearly indicate the relationship between brand and influencer by including the hashtag #ad and/or #sponsored and tagging the brand within the post description and above the "more" button (“FTC Social Media Guidelines For 2016”).

The FTC has determined that there are certain sanctions on incorrect handling the disclosure of sponsored content. Recently, more than 90 ‘influencers and marketers’ were warned about disclosing on posts which are paid for by advertisers. What is interesting to this, is that these warnings have been send due to petitions by advocacy organization Public

Citizen about Instagram posts. The NGO wrote a letter to the FTC in which it noted several apparent cases of non-compliance with disclosure rules on Instagram and expresses its

concern on sponsored content (Lecher). It is interesting that parties like the NGO are involved in these practices too.

2.5.3. Stichting Reclame Code

Stichting Reclame Code (SRC) is the Dutch institution in the field of advertising self-regulation. SRC promotes the creation of responsible advertising, aimed to ensure the

reliability and credibility of advertising. SRC created the Nederlandse Reclame Code (NRC), which includes rules to which advertising must comply. The rules have been drawn up in consultation with advertisers, advertising agencies and media. The SRC covers complaints about advertising, but also help advertisers prevent them from violating the NRC. (“Stichting Reclame Code: Wie Zijn Wij?”).

In 2014, the SRC introduced several guidelines for the use of sponsored content on social media in The Netherlands. If someone (the spreader) receives any advantages from an advertiser for spreading advertising via social media, and if this advantage affects the

credibility of the expression, the relationship between the advertiser and the person who spreads it must be clear (“Stichting Reclame Code: Reclamecode Social Media (RSM)”). In

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case of a micro-blog post, hashtag can be used. The following hashtags are imposed by the Reclame Code Commissie:

• #spon (sponsored) • #paid (paid) • #sample (sample) • #adv (advertising) • #prom (promoted)

It is noteworthy that the hashtags given by the SRC are all in English, whilst the SRC is a Dutch institution. It could be that this is the case because the language mainly used on

Instagram is English, but the institution does not give any clarification on it, thus it remains an assumption.

2.5.4. Hashtags by institutions

The SRC states: “Make use of hashtags, like:” (“Stichting Reclame Code: Reclamecode Social Media (RSM)”). What can be interpreted as that users and businesses can use the hashtags they come up with, but also other hashtags. It is also notable that the hashtags they call are all in English, whilst it is a Dutch organization. The FTC only sets two hashtags for the use of sponsored content. Table 1 shows which hashtags are set by the institutions.

Table 1. List of hashtags set by the FTC and SRC

Stichting Reclame Code Federal Trade Commission

#spon (gesponsord) #ad

#paid (betaald) #sponsored

#sample (sample) #adv (advertentie) #prom (promoted)

The FTC also states that when an influencer uses multiple tags, hashtags or links, Instagram users may skip over them, especially if they appear at the end of a long post. Therefore, if influencers use certain hashtags to point out sponsored content, they should disclose them above the ‘more’ button. Also, according to the FTC, disclosures like #sp and #partner are not

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clear enough towards users to point out that the post is sponsored (“FTC Staff Reminds Influencers and Brands to Clearly Disclose Relationship | Federal Trade Commission”).

2.5.5. Hashtags and tagging

Regular advertising on Instagram is regulated by the platform by providing advertisers with specific accounts and users, but such thing does not exist for influencers that make use of sponsored content. Therefore, hashtags like #spon, #ad and #sp are used to express that people are dealing with a sponsored post and that the one who posts the image is getting paid for it.

2.5.6. Hashtags

Hashtags are words prepended with the hash character ‘#’, used to indicate the content of the image, allowing users to label, sort, categorise images and search for pictures and increase visibility. Also, users can connect images with emotions with the use of emoji’s

(Giannoulakis and Tsapatsoulis 115). Internet users started to use hashtags with the IRC (Internet Relay Chat) in order to categorize items into groups. Later on, hashtags were introduced in social media use (Stec). The basic role of hashtags was to organize information and to make it easier to find and access certain knowledge (Small 873). According to Daer, Hoffman, and Goodman hashtags have metacommunicative functions, which are:

emphasizing, critiquing, identifying, iterating and rallying (brings awareness or support to a cause or campaign) (13).

Daer, Hoffman and Goodman argue that “because social media are fluid forms with changing purposes and affordances, users’ communicative manipulations and

experimentations must be acknowledged, documented, analysed, and incorporated into the design process itself” (14). In this way, users know for example whether they are dealing with an advertising expression or not.

According to Tsur and Rappoport, hashtags can be viewed as topical markers, an indication to the context or the core idea expressed. Therefore hashtags are adopted by other users that contribute similar content or express a related idea (Tsur and Rappoport 643).

2.5.7. Hashtags on Instagram

Hashtags were added on Instagram in January 2011, and from April 2015 it became possible for Instagram users to use emoji’s as hashtags (Baranovic n.pag.). According to Baranovic,

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hashtags on Instagram contextualize its content, location and place in time. Hashtags can be representational and thus identify the contents of an image, for example #pool. Also, there are emotive hashtags that describe feelings associated with the image, like #happy or #sad. Location based hashtags describe where the image was taken. Hashtags can also provide additional context, for example during events (Baranovic n. pag.). Baranovic states that brands are increasingly becoming aware of hashtags and their potential to reach an audience on Instagram. Hashtags are also being used for identification of users’ interests.

The most popular hashtags on Instagram are: #Love, #Instagood, #Me, #Cute, and #Follow (Aslam).

2.5.8. Tagging

Tagging is a way to connect a photo or text with other users. “Tagging a photograph makes the photo show up on the wall of the user who is tagged, so tagging a photo may expand how many people see the image”. Tagging results in direct communication between users (Dhir, Chen, and Chen 503). Tagging is a form of social behaviour. Burke et al. argue that tagging is a way to “signaling that their relationship is meaningful enough to merit an action” (Burke, Kraut, and Marlow 572). Tagging on Instagram can be done by using @mention. By typing the first letter of the name of the account that needs to be tagged, Instagram shows a list of potential @mentions. If the right name is not in the list, a user can click ‘search person’ (“Tags En Vermeldingen | Instagram-Helpcentrum”).

Next, to examine what kind of advertising Instagram affords, and how this is regulated by the platform itself and regulatory bodies, I will explain the setup of my study in the next chapter.

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3. Methodology

This chapter discusses the methodology and all steps that are taken to conduct the case study analysis of the regulation of advertising on Instagram. Because it became apparent that there are no strict guidelines for the use of sponsored content by influencers, this study seeks out in what ways influencers deal with sponsored content.

The methodology of this research is two-fold: in a first step of the analysis a timeline has been created to examine the evolution of Instagram in relation to its advertisers to gain more insight in the ‘official advertising’ on Instagram. Secondly, a hashtag analysis of the top 5 beauty influencers in The Netherlands is done to investigate how influencers deal with sponsored content in practice. In addition, a co-hashtag analysis is done to get an idea of semantic structures of hashtags used to point out sponsored content on Instagram. These analyses are done to gain insight in the ‘unofficial advertising’ on Instagram. The following paragraphs will outline which steps have been taken in order to gain more insight in the regulation of advertising on Instagram.

3.1. Case study

This research will be a case-study research, which is an empirical method that consists in the detailed analysis of spatially and temporally circumscribed phenomena. It often aims at generalizing results from a single case, or a handful of cases, to a larger sample (Ruzzene). A case study is directed towards a delimited situation or system with its own purpose and functioning parts. The aim is usually to provide an in-depth clarification of this situation. It is argues to be most suitable for a research of qualitative nature with rich data collection

methods, since they give deep and detailed information about the case (Bryman).

The purpose of this study is to conduct an exploratory study for the identification of sponsored content by influencers on Instagram.

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To learn more about the evolution of (the official side of) Instagram for advertisers over time, a timeline of key moments is being created. The timeline shows the evolution of all new features for advertisers on the platform. To do so, I analyse Instagram’s own announcements on new features through their blogposts. Instagram keeps up two different blogs2, one is for ‘normal’ users and the other is specifically for businesses. Only the business blog of

Instagram is used because the analysis focuses on advertising on Instagram. The business blog of Instagram is used to post blogs on announcements, success stories, tips and inspiration. The blogposts can be filtered on one of those themes. By using the filter ‘announcements’, only posts that describe major changes by Instagram itself are presented. Therefore, only the posts that were presented after using the filter ‘announcements’ were used to create a timeline. In this way, the blog already selected the most relevant blogposts.

3.1.1 Instagram’s business blog

On Instagram’s blog for businesses all new features that are interesting for advertisers are announced. After February 2017, the blog has been updated and now links to the new website of Instagram that does not have an archive of all older blogposts. To create a timeline of developments of Instagram for businesses, the old blog is used to gain insights in all changes. Tips, news and other things are shared on the blog, but this analysis only focuses on new features of Instagram for businesses. The blogposts do not have a date, for example it only says: ‘4 years ago’.

After creating a timeline that shows the evolution of Instagram and its features, only new features that are relevant for advertisers, or the way advertising is regulated on

Instagram, are being analysed and discussed in more detail.

3.2. Hashtag analysis

The second part of the research is a hashtag analysis, which focuses on hashtags that are used to indicate sponsored content on Instagram. To do so, this research makes use of ‘digital methods’. Rogers argues that “digital methods are techniques for the study of societal change and cultural condition with online data” and make use of digital objects like the hyperlink, share and like “to learn from how the objects are treated by the methods built into the dominant devices online” (1) . Digital methods are relevant for my study because it makes it

2

Instagram’s business blog: https://business.instagram.com/blog/ and Instagram’s user blog: http://blog.instagram.com/.

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possible to examine the digital object hashtags. By using digital methods, this study can learn from methods built into Instagram.

3.2.1. Influencers and hashtags

Firstly, an analysis of 250 posts of Dutch influencers is done to examine how they are dealing with sponsored content and the use of hashtags. Secondly, research is done on hashtags that are given by regulatory institutions. Which hashtags are accepted, and by whom? After that, the hashtags collected through posts of influencers are compared with the hashtags that are set by the regulatory institutions. Finally, all these hashtags are used for a co-hashtag analysis. In this way, an idea of semantic structures of related hashtags used to point out sponsored content can be given.

3.2.2. Selection of influencers

Firstly, a top 5 of influencers in the category ‘beauty’ is being selected by the use of the influencer engagement index (“Influencer Engagement Index: Dé Ranglijst van Influencers in Nederland Op Instagram”). The category beauty is used because beauty influencers are the most popular group (Asseldonk). The first 50 posts of these influencers are being retrieved and analysed, whereby the research looks at the post, the number of likes, the amount of comments, if the post is sponsored, the hashtags used, the tags in the photo and the tags in the text of the post. In total, 250 posts will be analysed on these aspects. Only the geolocation of the posts is not included because it is not relevant for this research.

The analysis of influencers uses posts of the 5 most popular beauty influencers in The Netherlands. According to the influencer engagement index, the most popular Dutch beauty influencers are (“Influencer Engagement Index: Dé Ranglijst van Influencers in Nederland Op Instagram”):

1. Beautygloss - Mascha Feoktistova 537k followers

2. Anna Nooshin 376k followers

3. Vera Camilla 227k followers

4. Serena Verbon 110k followers

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For the analysis of influencers, the 5 most popular beauty influencers in The Netherlands are used. After the selection of influencers, a research account called ‘lisathesis’ is created on Instagram. The account only follows the five beauty influencers described above. After that, the last 50 posts (before April 14,2017) of each influencer are saved manually and collected in a spreadsheet. This dataset includes information on the post, the number of likes, the amount of comments, if the post was sponsored, the hashtags that are used, the tags in the photo and the tags in the text of the post.

Then, all hashtags that are used when a post was sponsored are selected and put in a table. In this way, a clear overview of hashtags to indicate sponsored content per influencer was created. These particular hashtags are compared with the hashtags set by the regulatory institutions FTC and SRC.

3.2.3. Selection of hashtags

The hashtags listed by the FTC and the SRC, together with the hashtags used by influencers to point out sponsored content on Instagram are used to explore what kind of photos are posted with these hashtags. To do this, a tool named Visual Tagnet Explorer3 is used.

Combining the hashtags that are set by the FTC and SRC with the hashtags used by influencers for sponsored content gives the following list of hashtags: #spon, #paid, #sample, #adv, #prom, #ad, #sponsored, #gesponsord, #gekregen, #partner and #sp. These are the eleven hashtags that will be used as input for the Visual Tagnet Explorer tool. The hashtag #cadeautje (gift in Dutch) is not used because it indicates that something was given, but does not coincide enough with sponsored content.

For each hashtag, the most used co-hashtags are being analysed by using Gephi files that are exported to Excel files. The Excel files show per hashtag the most used co-hashtag and the number of times it occurs. It has to be taken into account that the dataset is gathered at a certain moment and uses the last thousand posts from that moment on. Therefore,

co-hashtags that occur in the dataset are time-related.

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3.2.4. Digital Methods tool Visual Tagnet Explorer

For this research, a tool called ‘Visual Tagnet Explorer’ is used. The tool is “an app for researchers and brand analysts to create Instagram co-tag networks around keywords or places” (“Visual Tagnet Explorer”). The tool is created by Bernhard Rieder, who is affiliated with the Digital Methods Initiative (DMI), an internet studies research group at the University of Amsterdam. DMI “designs methods and tools for repurposing online devices and platforms (such as Twitter, Facebook and Google) for research into social and political issues”

(“DmiAbout < Dmi < Digitalmethods.net”). By using the tool, one can retrieve the latest media tagged with a specified term, but it is also possible to retrieve the latest media around a particular location. For this research, only the first method is used.

The listed hashtags above are used as input for the tool, the amount of iterations is chosen to be 50 per tag which creates the maximum of 1000 items (one iteration gets 20 items). The feature ‘preview media’ is filled in with ‘thumbnail’. After filling in the tag and the number of iterations the tool creates the following output:

• a tabular file containing a list of media with lots of meta-information; • a tabular file with information on the users related to those media;

• a co-tag file (GDF format) to analyze e.g. in gephi (“Visual Tagnet Explorer”).

Thus, the tool creates a data file including the last 1000 Instagram posts that used the given tag, the file contains information on the user-ID, created time, location, number of comments, number of likes, the filter used, link, caption, thumbnail, tags, user name and user-ID. All collected data with the Visual Tagnet Explorer tool is gathered on April 20, 2017.

3.2.5. Co-hashtag analysis

Collected data by the Visual Tagnet Explorer tool is used to do a co-hashtag analysis. The basic idea of the co-hashtag analysis is to assemble a dataset of relevant posts, after which two (or more) hashtags can be considered connected (Rieder). By looking at a whole dataset in terms of these connections, it can be seen which kinds of subjects relate to other kinds of subjects. Relationships can be analysed by finding out how the subject matters relate (Rieder). By doing a co-hashtag analysis, it becomes apparent which other hashtags are used in

combination with the sponsored hashtags (to learn more about this particular type of advertising space).

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Next, to examine the advertising possibilities on Instagram, I will discuss the evolution of Instagram as an advertising platform in the next chapter.

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4. ‘Official advertising’ - The evolution of Instagram as an

advertising platform

This chapter will discuss the evolution of Instagram as an advertising platform. It exists of an analysis of a timeline that shows the development of Instagram over time. The timeline contains announcements of key features for Instagram’s business users and can be found in the appendix. Announcements on new features on Instagram will be discussed that are relevant for advertisers, regulation of advertising or sponsored content on Instagram will be discussed in detail. The information is collected through blogposts published by Instagram. By analysing Instagram’s timeline, ‘official advertising’ on Instagram is being discussed.

4.1. Instagram’s advertising policy

For advertising on Instagram, the platform refers to the policy page of Facebook, where is explained under the title “Restricted Content” at point 9 that ads of verified pages (with a blue badge) that promote branded content, must tag the product or brand of the third party, or tag the sponsor with the appliance for branded content. Branded content in ads are defined as content in which the editorial content is affected by a product, brand or sponsoring of a third party (for example product placement, sponsoring, sponsor logo’s, etc.) and illumines this items. When pages place integrations of non-forbidden brand content, they must use the utility tool for brand content (“Advertentiebeleid”).

According to Facebook’s policy, branded content is content (among which text, photos, video’s, articles, links, 360-degree-video’s and livevideo’s) of page-owners that show products, brands and sponsors. Branded content is only allowed on verified pages and profiles (with the blue badge) on Facebook. Page-owners are mostly media companies, celebrities or other influential people. With the policy for branded content, owners of verified pages can make and promote branded content on Facebook. Facebook also offers a utility tool to do this. If they use the tool, page-owners of verified pages can tag third parties whereby they can also look at statistics and share and promote content in which they are tagged (“Helpcentrum”).

It becomes clear that Instagram refers to the policy of Facebook for sponsored content because Facebook is the owner of Instagram, but they contradict themselves by saying that

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people need to use a tool to tag the advertiser. As said before, Instagram does offer a tool for tagging partners (which has just been introduced), but cannot be used globally (yet). When using sponsored content, users (or brands) have to adhere to Facebook’s rules, whilst Instagram is making this impossible.

4.2. Timeline by blogposts on Instagram’s business blog

On Instagram’s blog for businesses4

all new features that are interesting for advertisers are being announced. The title of Instagram’s business blog is: “Welcome to the Instagram for Business blog. See how businesses of all sizes around the world are inspiring people with their stories, and get the latest news from Instagram HQ” (“Instagram for Business”).

In the first blogpost (which was published four years ago), Instagram explains the business blog is launched to “use as a resource for businesses – a way to discover what other business accounts are doing on the platform and to learn tips and tricks for how to use

Instagram from a business perspective” (“Instagram for Business”). Instagram wants to make sure that businesses have the knowledge and tools they need to start using Instagram in a meaningful way.

Instagram has developed as an advertising platform, introducing multiple new features. Each feature can be divided into a category of developments on Instagram. Those categories are: 1. Integrating businesses as specific user type, 2. New ad features, 3. New ways to organize advertising. Each category will be discussed in the following paragraphs.

4.3. Integrating businesses as specific user type

The first category in which Instagram’s announcements on new features can be divided in, is: ‘Integrating businesses as specific user type’. From the beginning, Instagram used to treat all users the same. There was nothing like a business profile nor did businesses had other possibilities with the platform than normal users. After existing quite a while, Instagram started to see that businesses could be treated differently than normal platform users. Instagram started to integrate businesses as a specific user type.

Regulation of Advertising and Sponsored Content on Instagram