Advertising regulations harm social media influencers, followers, and marketers alike

Johns Hopkins University | April 15, 2019

Social media has given rise to a new breed of influential figures and brand ambassadors in recent years. Micro- and even nano-influencers-social media users active on platforms such as Instagram and YouTube who have access to anywhere from several hundreds to hundreds of thousands of followers-are increasingly securing endorsement deals and contracts for sponsored content.
In 2017 alone, marketers around the world spent $570 million on social media marketing, according to a report in eMarketer. The New York Times reports that the social media influencer industry is expected to exceed a $10 billion value by 2020.
But a new study from the Johns Hopkins Carey Business School shows that regulations meant to protect consumers from predatory social media marketing tactics actually contribute to a decrease in competition between influencers, causing the overall amount of paid content to rise and audience engagement to plummet.

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