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Directorate-General for Consumers
2018 EUR 6 EN
BEHAVIOURAL STUDY ON
ADVERTISING AND MARKETING
PRACTICES IN ONLINE SOCIAL MEDIA
Annex 141 Stakeholder survey
Specific contract No 2015 85 01
under Framework contract No Chafea 2015 CP 01
Prepared by the GfK Consortium Final version June 2018
Consumers Health Agriculture and
Food Executive Agency
Directorate-General for Consumers
2018 EUR 2 EN
EUROPEAN COMMISSION
Produced by Consumers Health Agriculture and Food Executive Agency (Chafea) on behalf of
Directorate-General for Justice and Consumers
Unit 03 Economic analysis and evaluation
Contact Unit 03
E-mail JUST-03eceuropaeu
European Commission
B-1049 Brussels
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 3 EN
Behavioural Study on
Advertising and Marketing
Practices in
Online Social Media
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 4 EN
LEGAL NOTICE
This report was produced under the EU Consumer Programme (2014-2020) in the frame of a specific contract with
the Consumers Health Agriculture and Food Executive Agency (Chafea) acting on behalf of the European
Commission
The content of this report represents the views of GfK Belgium and is its sole responsibility it can in no way be taken
to reflect the views of the European Commission andor Chafea or any other body of the European Union
The European Commission andor Chafea do not guarantee the accuracy of the data included in this report nor do
they accept responsibility for any use made by third parties thereof
Project number 20183823
Title Stakeholder survey
Language version FormatVolume Catalogue number ISBN DOI
EN PDF PDFVolume_01 EB-01-18-688-EN-N 978-92-9200-939-7 102818693859
copy European Union 2018
Reproduction is authorised provided the source is acknowledged
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 5 EN
Table of Contents
1 Introduction 6
2 Methodology 6
3 Types of commercial practices and role of industry stakeholders 6
31 Commercial practices 6
32 The role of Intermediaries and B2B clients 7
4 The role of OSM providers 8
41 Approval of content 8
42 Format and functionalities 9
43 Targeting 10
5 New functionalities 10
51 Identified trends 10
52 Potential problems and benefits for consumers 11
6 Misleading practices and remedies 12
61 Types of misleading practices 12
62 Remedies 14
7 Issues and complaints 14
71 Consumers 15
72 B2B clients 15
8 Actions by enforcement authorities 15
9 Conclusions 17
91 Novel commercial practices on social media 17
92 Potentially misleading practices identified by stakeholders 18
93 The role of OSM providers in the approval process formats and functionalities 18
94 Remedies proposed by industry stakeholders 19
10 Appendix 20
101Appendix 1 List of stakeholders interviewed 20
102Appendix 2 Stakeholder survey ndash interview guide 22
103Appendix 3 Briefing on misleading commercial practices 26
104Appendix 4 Analysis ndash Empty grid used for analysis 28
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 6 EN
1 Introduction
The following section describes the results of the stakeholder survey with six types of relevant
stakeholders B2B clients (14) local intermediaries (13) global intermediaries (11) consumer
organisations (3) advertisers organisations (8) and academics (4) OSM providers were also
contacted for participation in the survey although only a single OSM provider participated in
the research This interview was discarded as the response from a single respondent did not
allow a separate analysis of the OSM providersrsquo views on the topic
B2B clients are organisations that engage in commercial practices directly through social media
They have a business-to-business relationship with the online social media providers In
contrast the end client can also appeal to intermediaries which act as a third party facilitating
commercial practices through social media In this case the end client does not engage directly
with the social media providers The stakeholders listed in Appendix 1 were interviewed about
their perspective on commercial practices through online social media These views are
summarised below with regard to the following key research topics
- The main topics of the interview concerned
- Commercial practices on OSM
- Novel functionalities and trends
- Potential concerns and benefits for consumers
- Misleading unfair and problematic commercial practices on OSM
- Potential remedies
- The roles of the stakeholders in the approval format and functionalities of marketing
content in OSM
- User issues and complaints
2 Methodology
Stakeholders were approached through GfK contacts in the sector contacts found through desk
research and interactions with consumer and advertiser associations The actors contacted
were invited for an open-ended telephone interview In total 53 interviews were conducted by
researchers dedicated to the project All interviews were recorded for further analysis
An interview guide was used to structure the 30- to 40-minute conversations containing open-
ended questions on the key topics At the start of the interview the respondents received
information on the context of the study Furthermore consent was obtained to report their
company name and to record the interview for analysis After the fieldwork the recordings
were summarised in a specific grid created for data analysis which was based on the key
research dimensions This grid included in Appendix 4 guided the analysis of the interviews
and the subsequent report-writing phase
3 Types of commercial practices and role of industry stakeholders
31 Commercial practices
Companies and organisations can engage in various types of commercial practices through
online social media The stakeholders interviewed differentiate two broad types of activities
posting lsquoorganicallyrsquo and engaging in lsquomarketingrsquo The former encompasses publishing
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 7 EN
interesting content without paying for it (eg posting stories or news on a companyrsquos own
social media page) the latter includes all types of payed-for commercial practices ndashsee below
Within marketing the type of practices used depends on the stage of the marketing process
The stakeholders first identify the lsquoawarenessrsquo stage (also called branding) in which the aim is
to reach a broad audience and provide them with an impression of a productservice Posting
pictures or video is suited in this phase as well as publishing an advertorial (ie a sponsored
article to be posted on social media) Intermediaries or B2B clients may for instance invest in
Facebook banner ads Sponsored Instagram ads Promoted pins on Pinterest or a skippable
lsquoprerollrsquo video on YouTube The focus in this phase is on reaching a certain number of users in
a certain amount of time and it can be linked to any type of engagement with an offer clicking
on it studying it liking it etcetera
A second phase in advertising concerns the conversion phase (also called performance) The
goal in this phase is to promote a specific productservice and to sell it More precise targeting
is therefore essential in this phase It can be accomplished by targeting on demographics or
interests remarketing (taking into account which productsservices the user researched
outside the OSM platform) targeting based on a list of users (from a company database from
individuals who subscribed to receive updates etcetera) For the actual purchase of the
productservice social media provide the opportunity of linking to a product page or facilitating
shopping through the social media platform (eg advertisers can add a shop section to a
brandrsquos Facebook page)1
In addition to those listed under the aforementioned phases of advertising certain other
commercial practices were discussed in the stakeholder interviews These practices include
paying social influencers for promoting productsservices managing (as an intermediary)
the social media pages and communities of brands and analysing what users are saying
about brands on social media These services are not offered by the OSM providers but by
third parties such as individual social influencers or intermediaries
32 The role of Intermediaries and B2B clients
For organisations that wish to engage in commercial practices on social media the possibilities
and options are plentiful To make the right decisions in terms of targeting content and general
strategy these organisations can turn to intermediaries A B2B client explains that it depends
on the budget and complexity of a campaign whether they set it up on their own or involve an
advertising company If the budget is high and the project is complex ndash in terms of targeting
format content or otherwise ndash an intermediary is more likely to become involved
This indicates the first role of intermediaries which is to provide advice to organisations that
aim to advertise through social media The intermediaries have expertise in both the functions
of social media platforms as well as in marketing strategies Offering this combined expertise
is an added value for their clients For this reason an interviewed B2B client values the
involvement of intermediaries
ldquoThe thing [intermediaries] got ndash and theyrsquore really so important for that ndash they got all
the knowledge about all the Facebook products about what works fine and what
doesnrsquot work fine They give us quite a bit of advice on what we should push on
1 On Facebook advertisers can set up a shop section and include a ldquoMessage to Buyrdquo button allowing consumers to indicate products they are interested in purchasing For the payment of the order users will be redirected to the merchantrsquos website as the option of payment through the Facebook platform is not (yet) available in the EU httpswwwfacebookcombusinesshelp912190892201033
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 8 EN
Facebook Twitter and YouTube as well So theyrsquove got all the knowledge and quite a
lot of experience with itrdquo
Second local and global intermediaries can have an important role in reaching the right target
groups and optimising the strategy for targeting audiences As the targeting options on social
media are extensive advertisers sometimes hire an intermediary to set up a campaign For
instance one of the interviewed B2B clients hired a marketing agency (as intermediary) to set
up the targeting of specific groups The intermediary in this case helped the client to take the
first steps in advertising through social media
Furthermore a subgroup of intermediaries offers software that facilitates advertising through
online social media or assessing the effectiveness of campaigns For example one of the
intermediaries has created software that assists in buying advertising space on Facebook
creating campaigns setting up target audiences etcetera Their software package can be
considered an efficiency tool which saves time for the end clients and allows them to advertise
on Facebook at a greater scale Other intermediaries create software for acquiring more
detailed metrics on campaigns and advanced statistics on the outcomes For instance an
intermediary offers a tool that shows the performance of an advertisement across multiple
platforms One of the interviewed academic furthermore refers to a software called Ditto that
analyses social media images for visual cues on brands and emotions These examples have in
common that they take advantage of the data available through social media and construct
more advanced metrics than those offered on the OSM platform
Finally intermediaries can take up the creation of content (visuals and texts) for social media
campaigns or they may handle all communication through social media of behalf of their client
(ie social media management) With regard to the control of contents and formats the
intermediaries indicate that their end client has the final word in approving the approach
Nevertheless a local intermediary remarked that their company would not assist costumers
that aim to place misleading ads or performs aggressive targeting
The aforementioned examples show that clients may cooperate with intermediaries in a variety
of cases In other instances however organisations choose to set up their campaigns
themselves For the majority of the interviewed B2B clients his implies using the platform tools
without any personal assistance Only B2B clients that have a large budget to spend on social
media advertising (or that represent highly popular brands) can rely on a direct contact person
(account manager) in the major social media As a B2B client phrases this
Were trying to reach out to [Facebook] to have a personalised relationship so that
we can ask stuff But thats only for top-tier clients that have like five million likes or
something They have an account manage but for us we dont have one yet
At least five B2B clients among the interviewed representatives do have account managers
For these companies the account managers offer a more accessible means of communication
with the OSM providers The companies tend to correspond with them mainly at the start of a
campaign or when a campaign is more complex
4 The role of OSM providers
41 Approval of content
Stakeholders indicate that social media providers have rules about what is accepted and not
accepted in an advertisement Facebook and Twitter for instance explicitly promote these
rules to advertisers For Facebook their policy concerns violence sexuality alcohol and drugs
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 9 EN
Moreover it also forbids lsquoclickbaitrsquo and images that contain over 20 percent of text Google
(YouTube) is quite strict in terms of regulating nudity in videos and LinkedIn also performs
automated checks on advertisements (eg the platforms restricts the use of capitalised
words) Overall the stakeholders have the impression that the rules on advertising in online
social media are quite strict A local intermediary adds that the rules have become more
restrictive over time in the beginning almost everything could have been posted online
whereas now it is more limited the intermediary reports
In practice when submitting an advertisement on Facebook it is checked through an
automated process Within 10 minutes the advertiser is notified whether the ad was
approved or rejected In case the advertiser disagrees with a rejection he or she can send
feedback after which someone will check the concerned advertisement Despite this automated
check the intermediaries and B2B clients indicate that Facebook cannot possibly check every
aspect of an ad as the volume is very high There is however a second mechanism through
which users can report problematic advertisements after they are published Ads on Facebook
feature reporting buttons and other means for all users to provide feedback A B2B client
explains that Facebook bases the price of a campaign on how successful it is (ie the number
of times it is liked by users) and to what extent it receives negative user reports If
advertisements are unsuccessful or frequently reported by users Facebook will increase the
price for the advertiser or ask the advertiser to make changes to the advertisement (in terms
of content pictures or wording) to increase its attractiveness It is furthermore reported that
negative user feedback can lead to the shutdown of campaigns
42 Format and functionalities
In terms of formats and functionalities social media are constantly innovating and
creating new marketing possibilities These new options are promoted towards
advertisers for instance by providing online trainings about the new features informing
advertisers through sales people or offering price incentives Through these methods for
instance Facebook has promoted video as an advertising format in order to compete with other
platforms most notably YouTube
The social media providers are balancing their need to offer new options and the trust of their
platform users For this purpose there are certain limitations to the formats For instance
when content is sponsored Facebook adds a label to the ad Users can also typically report an
advertisement when they think the format or contents are inappropriate (see also ldquoApproval of
contentrdquo)
In terms of functionality social media providers offer information about which users are
targeted These data are always anonymous as a global intermediary indicates
ldquoWe only get information about masses of people The only reason why we get this
kind of information is to make our message more relevant for peoplerdquo
Even though the provided metrics are very detailed (indicating language age
location ethnicity interests etcetera) they are only visible for segments of 1000 to
2000 users From the perspective of intermediaries and B2B clients this renders the metrics
somewhat unsatisfying A B2B client notes that if metrics were more granular it would be
easier to target the right users making them more satisfied An academic concurs that the
metrics are relatively high-level and suggests that OSM providers could give more information
about the number of individuals actually targeted compared to the desired target size On the
YouTube metrics a local intermediary remarks that they are poorly organised and highlight
mainly the number of ldquoclicksrdquo whereas not all clicks will bring the user to the advertisers
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Directorate-General for Consumers
2018 EUR 10 EN
website As an experienced user in advertising the intermediary adds one can create custom
reports and custom setting on YouTube resulting in metrics that are more useful
43 Targeting
The intermediaries and B2B clients indicate that the OSM providers have an important role in
providing targeting possibilities They offer the underlying data deliver the targeting options
design the settings and provide statistics The interviewees indicate that they receive
automated suggestions through the online interfaces for entering target groups All
the major social media providers (Facebook Google Twitter) offer this type of advice For
instance when an advertiser selects a keyword for targeting in Twitter the online interface will
suggest related keywords The possibilities are also extensive allowing to select specific target
groups A critique however is that the advertisers cannot verify whether the right profiles are
selected for a certain target group and if the right individuals have been reached In this regard
they have to trust the platform owners
Three types of information are used for targeting profile information (the demographic
and other data that users provide) interest-related data (based on for instance likes and
group membership) and behavioural data (based on what users do ie their location
browsing behaviour etcetera) Facebook is indicated to be most advanced in terms of the
offered targeting options as this platform has most data on its users The targeting can be
based on liked brands or pages watched picturesvideos activity on webpages outside
Facebook device location etcetera Furthermore YouTube is also mentioned as a well-
developed platform for targeting advertisements In addition certain platforms are
preferred to target broad groups of individuals For example Snapchat is well suited to
reach younger people whereas Instagram is more appropriate for targeting women Several
new targeting methods have been developed recently which will be discussed in more detail
in the following section
5 New functionalities
51 Identified trends
Social media offer many new possibilities in terms of commercial practices Firstly targeting
is a prime area for which new functionalities were identified In general the interviewees note
that targeting is becoming increasingly more sophisticated and efficient Two specific features
of Facebook were often named custom audiences and lookalike audiences The former
implies that companies use their client database (eg a CRM database containing e-mail
addresses or phone numbers) to specifically target the individuals in this database The
latter lookalike audiences is a functionality that allows targeting new users who have
similar characteristics as a specified group of individuals Performance metrics on these
targets could possibly be much more detailed down to the level of the individual but Facebook
does not allow metrics on custom audiences of fewer than 1000 individuals2
2 The Facebook Advertiser Help Center mentions this limitation with regard to metrics (Audience
Insights) on custom audiences httpswwwfacebookcombusinesshelp580994405331939
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2018 EUR 11 EN
Other novel types of targeting that were mentioned include remarketing (advertising based on
a usersrsquo visit of websites outside the OSM platform) and the linking of data from different
platforms An example of database linking includes the use of Facebook data to target users
on Instagram or the linking of Facebook and WhatsApp data
Additionally new functionalities in terms of formats were discussed The B2B clients and
intermediaries identified an increase in integration of content and advertising For
example commercial messages are more often being shown inside content space and
advertisement labelling has sometimes become less conspicuous Formats also
increasingly focus on keeping users on the social media platform instead of redirecting
them to other websites An example is the canvas advertisement on Facebook which is
essentially a small web page that users can navigate while staying on the Facebook platform
Furthermore video content is seen as an increasingly important format A global intermediary
confirms that videos are better received by consumers and yield better results compared to
traditional advertisements Finally important new indirect ways of advertising were identified
such as promoting brands through social influencers or having lsquonormalrsquo users promote
brands (eg by offering sponsored lenses (or lsquoframesrsquo) which individuals can apply to their
Snapchat pictures)
New functionalities were also observed with regard to metrics and statistics Firstly
advertisers can increasingly link their online advertisements to purchases A local
intermediary explains that when an item is promoted on multiple OSM platforms the
advertiser can determine from which platform the buyer arrived at the sellerrsquos website Second
new software can generate statistics that go beyond the overviews offered by the social media
platforms This software is provided to advertisers and intermediaries and collects the data
through the APIs of the social media platforms (eg Facebook and Twitter) One of the
interviewed intermediaries creates software that enables advertisers to assess which ads work
best with what audiences Another type of technology referred to by a global intermediary
measures what types of emotions are expressed through comments on commercial messages
Overall the advanced analysis by intermediaries of large amounts of raw data provided by
social media platforms is considered as an important new functionality
52 Potential problems and benefits for consumers
With the extensive options in terms of targeting and data usage privacy was often discussed
as a main concern More specifically critique was expressed on the use of client databases for
targeting on social media A local intermediary remarks that not all individuals in a company
database may have opted-in for targeting through social media Consumers may not be fully
aware that contact information collected ldquoofflinerdquo may be used for commercial
practices on social media As an academic notes this can be potentially worrisome
ldquoWhen I gave my phone number e-mail address or physical address I wouldnrsquot expect
those businesses to be able to track me on Facebook and target me with ads but now
they can That is a troubling new functionalityrdquo
Furthermore the practice of remarketing can be perceived as problematic in some cases A
local intermediary argues that retargeting may not be desirable for all products and users may
not wish their purchases (or purchase intentions) to be displayed on-screen Finally in addition
to being perceived as lsquospookyrsquo or lsquoscaryrsquo sophisticated targeting can be problematic when
different individuals are shown different offers (price discrimination) or when certain individuals
are excluded from offers With regard to the latter a consumer organisation identified a
particular risk in insurance companies that chose to advertise only to low-risk individuals (for
instance by targeting users based on their educational level) In terms of formats
commercial messages that look like regular content have the potential to mislead
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2018 EUR 12 EN
consumers Two advertisers organisations name this practice as particularly
problematic In their view consumers should not be misled by an ad that looks like editorial
content As one organisation adds it is especially problematic when such an advertisement
reaches young people who may not possess the background knowledge to discern ads from
editorial content Moreover it is problematic when advertisements are integrated into the social
interaction among users It can be perceived as highly intrusive to see an advertisement
between the Snapchat stories of friends or among private messages on Facebook In addition
to the aforementioned downsides certain benefits of more advanced targeting and data usage
were put forward by a broad range of interviewed actors The displayed advertisements are
more interesting and relevant for the social media users Because the content is more relevant
individuals will be less inclined to feel bothered by hem and instead appreciate the commercial
practices For the same reason the targeted messages may add value for consumers rather
than cause annoyance As a global intermediary summarises
ldquoIn a world where we get so many messages its [about] being relevant [in] what you
say being relevant about the type of product for a certain type of peoplerdquo
6 Misleading practices and remedies
61 Types of misleading practices
The interviewed representatives of B2B clients and Intermediaries indicate that they witnessed
only few instances of clearly misleading practices on the large social media They argue that
social media aim to avoid such misleading advertisements as they do not wish to upset users
Since advertising is a crucial element in their business model social media are very careful
about which advertising they show When prompted however the interviewed B2B clients and
Intermediaries were able to provide examples of misleading problematic and unfair commercial
practices Additional information is provided by consumer organisations and academics who
played particular attention to user data collected by social media They also referred to cases
of malware phishing and misleading promotions The types of misleading commercial practices
that are reported can be classified under the following five categories
Disguised marketing
First an often-mentioned problem is the difficulty to recognise advertising on social media
In part the difficulty to identify ads is related to their format For example on Facebook the
difference between sponsored content and user content is very subtle On Twitter as well it is
difficult to know if content is paid for when browsing hashtags A B2B client suggests that social
media purposefully integrate advertising and content
ldquoOn Facebook it is signalled when content is sponsored but it is not very
obvious and this is on purpose because Facebook does not want to show so
clearly that it is an ad
Furthermore commercial practices are sometimes difficult to recognise because the
commercial nature is not disclosed For example the presence of product placement may not
always be clearly labelled or indicated A specific case in this regard are social influencers
Celebrities or individuals who are popular on social media may be paid by brands to mention
or promote their products When they do not disclose being paid this can be misleading
towards consumers The latter problem is mentioned by several intermediaries and an
advertising self-regulatory body The advertisersrsquo organisation indicates that social influencers
are posting sponsored messages on social media but that they are not necessarily following
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 13 EN
the rules set out by self-regulatory bodies (ICC) and by the European Commission (UCPD) It
is argued that such failures may be due to inexperience and lack of familiarity with the existing
rules rather than a conscious intent not to adhere to them
Misleading marketing content
A second type of problematic commercial practice concerns misleading or incorrect product
or price descriptions This includes advertising with misleading information about the price
of a product (eg claiming something is free when it is not) the qualities of the product or
incorrectly claiming that an offer is limited in time This type of misinformation also includes
social media campaigns that are referring to a promotion which is no longer valid
Intermediaries and B2B clients further mentioned that product endorsements by social media
users may not always be fully genuine as they could be part of a lsquoshare and winrsquo or lsquolike and
winrsquo action
Undesirable or improper user targeting
Undesirable or improper user targeting is a third important problematic commercial practice
Several B2B clients and intermediaries mention that many users are unaware of how they are
being tracked and how this affects the advertisements that they see The fact that advertising
is personalised and targeted at specific groups without the users being fully knowledgeable
about it is perceived as problematic by an interviewed academic For example many social
media users may not be aware of any behavioural tracking that occurs (eg platforms tracking
the usersrsquo activities on their website and on many other websites that users visit) It implies
that users may not have been sufficiently informed to give consent to this type of tracking
Furthermore brands can advertise to users who have never lsquolikedrsquo the brandrsquos page or have
no interest in the brand at all (for instance by inserting advertisements on their Facebook News
Feed) A B2B client explains that this practice can make users angry based on individual
comments on the companyrsquos Facebook posts and private messages received through Facebook
Targeting can also fail when it is based on inaccurate information or wrong assumptions Users
may for instance be targeted with products they have already bought
Processing of private data
Fourthly participants in the stakeholder survey indicate that it is problematic when very
private data is not processed transparently Social media collect many different types of
information about their users including profile data activities on the platform real-world
location et cetera How these data are used however is not entirely clear to users The B2B
clients and consumer organisations expressed concern about what data is stored how safe it
is stored and whom it is shared with A consumer organisation mentioned that online social
media do not limit the storage of data in time ie it is stored indefinitely The same
organisation also points out a problematic example of a mobile phone banking app which sends
information to Facebook without notifying its users With WhatsApp being part of Facebook a
local intermediary finds it increasingly unclear which information shared with others is still
private and which can also be used for commercial purposes
Aggressive or criminal practices
A final type of problematic commercial practices concern cases of aggressive or criminal
practices Although the stakeholders indicated that criminal practices are not widespread on
social media they did refer to scams phishing and other illegal activities One particular
example provided by a global intermediary concerns a fake airline profile on social media
which promised that a user can win euro3000 by sharing a message These profile pages receive
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 14 EN
a high amount of visitors and can afterwards be sold on the black market Other cases
mentioned in two B2B interviews are about lsquoaggressiversquo advertisements and aggressive phone
calls after entering contact details on social media
62 Remedies
Various remedies are suggested to counter the aforementioned misleading unfair or
problematic practices The stakeholders interviewed see a role for advertisers social media
users platform owners and governments Intermediaries and B2B clients recognise their role
as advertisers to engage in fair commercial practices that are relevant for consumers In
addition these actors also point out the responsibilities of social media users The latter have
the ability to shape their online advertising environment by indicating which advertisements
they like or do not like As a global intermediary summarises it
ldquoId rather see something that I like or might like instead of tampon commercials So
you yourself [as a user] can make that ad environment just better and more personal
So why wouldnrsquot yourdquo
Furthermore users can report the ads that they find problematic through the automated
reporting on social media The interviewed intermediaries and B2B clients strongly encourage
this
Nevertheless social media providers also have a role in this process Certain B2B clients
and intermediary stakeholders indicate that it is unclear how complaints and reports are
handled Social media providers could be more lsquohands-onrsquo in dealing with user complaints and
when approving advertising Even though the platform owners do not have the capacity to
manually check every advertisement the interviewed advertisers stress the importance of
having a human being (in addition to a computer system) estimate which practices are
acceptable and which are not Furthermore a self-regulatory advertising body proposes that
social media immediately take down advertisements when the self-regulatory body has decided
that they are not acceptable
From the interviews with the different types of stakeholders three key steps to be taken by
social media providers emerged (1) simplify their terms and conditions as well as privacy
policy and present these terms to users in a clear and understandable way (2) label advertising
more prominently and ensure that the same wordingformatting is used throughout the entire
platform and (3) offer more options as opt-in features rather than opt-out With regard to the
first aspect a consumer organisation argues that If the terms of services are not available
and not understandable then its impossible to get an actual consent from the consumer
Finally certain participants in the survey identified a role for governments An intermediary
and consumer organisation suggest that governments (eg on a European level) should
monitor commercial practices performed on online social media and track new technologies
that could potentially violate consumer rights In terms of the current commercial practices on
social media the interviewees from different stakeholder categories identified the need for
laws on privacy and data protection to be adapted to the current practices on social
media Finally legislation is requested to ensure that social influencers are required to
disclose when they are being paid for certain messages With regard to the latter a global
intermediary adds the following
ldquoJust like we have to do on TV and say there is product placement in the TV
show you should be obliged to do it on your social mediardquo
7 Issues and complaints
EUROPEAN COMMISSION
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2018 EUR 15 EN
71 Consumers
Consumers have different means of complaining about problematic commercial practices on
social media The most common channel to voice complaints is through the social media
platforms themselves On Facebook users may for instance click negative emoticons post
comments or report the advertisement Less commonly private messages can also be sent
to advertisers Depending on the situation either social media providers deal with a complaint
(eg for complaints expressed through the reporting tool) or the advertiser handles it (eg
for complaints communicated through comments or private messages) Consumers almost
never address their complaints to intermediaries because for social media users it is not visible
which intermediaries are behind a campaign Intermediaries may deal with user complaints in
the name of their end clients or they may forward the complaints to their clients Certain
intermediaries are not at all involved in dealing with user complaints for example
intermediaries which offer software for metrics Some actors use a very structured approach
in answering user feedback One of the interviewed B2B clients makes use of a flow chart to
identify which actions to take in case of user positive neutral or negative consumer response
on social media
The interviewed B2B clients intermediaries and consumer organisations primarily identified
user complains concerning the high number of advertisements (lsquospammingrsquo or lsquopolluting their
contentrsquo) the targeting of commercial practices (mistargeting showing irrelevant ads or re-
targeting advertisement) and the difficulty to identify advertising and discern it from other
content With regard to the latter an advertising self-regulating body reports an
increase in the complaints about social influencers who do not clearly identify which
of their activities are sponsored
72 B2B clients
The issues and complaints that advertisers have are related to the social media platforms
Nevertheless the number of complaints is very limited When issues do arise they are
sometimes related to the platform disapproving an advertiserrsquos campaign without a clear
reason the complexity of the options when advertising on social media and the difficulty of
working with the platformrsquos API (Application Programming Interface)
8 Actions by enforcement authorities
Involvement of enforcement authorities was not a common action when dealing with
problematic commercial practices An important explanation for this is that ndash as multiple
stakeholders indicated ndash going to court takes time It is far more likely that a consumer
complaint is resolved by the advertising company or that a self-regulatory body is involved
The German advertising self-regulator pointed out that their process is much faster than a
court procedure However when the regulator lacks resources or when the complaint deals
with criminal activities the issue is taken to the enforcement authorities
When enforcement authorities are involved it usually concerns the most serious complaints
Examples mentioned by the interviewees include cases about criminal activities (Germany)
alcohol advertising (Poland) data collection (Italy) and out-of-stock products (Belgium) In
many of the cases mentioned in the interviews the government was involved by filing a
complaint against certain commercial practices
Whereas investigations against social influencers are not common in Europe the United States
enforce a more extensive legislation on this topic A respondent from a global intermediary was
EUROPEAN COMMISSION
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aware of a case in the United States where the legal authorities had fined YouTube influencers
for not disclosing sponsorship
EUROPEAN COMMISSION
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2018 EUR 17 EN
9 Conclusions
The stakeholder survey is part of subtask 14 which aimed to investigate marketing practices
on online social media from a traderrsquos point of view The survey consisted of 50 in-depth
interviews of stakeholders belonging to relevant subgroups with different perspectives and
explored the roles and responsibilities of OSM providers and other actors in the commercial
practices on their platforms More specifically the stakeholder survey aimed to acquire
information about which commercial practices can be found on social media and in what way
certain practices may be misleading unfair or problematic for consumers Additionally the
views of the different stakeholders were assessed and compared as well as their role in the
commercial practices
Types of commercial practices on social media
The stakeholders interviewed differentiate two broad types of activities
- Posting lsquoorganicallyrsquo publishing interesting content without paying for it
- Performing lsquomarketingrsquo engaging in payed-for commercial practices
Additional practices emerged during the interviews including paying social influencers for
promoting products or services managing the social media pages or communities of brands
and analysing what is being said about brands on social media These services can be offered
by local or global intermediaries or by individual social influencers
91 Novel commercial practices on social media
Throughout the stakeholder interviews different functionalities and targeting methods on social
media were discussed The four largest OSM platforms covered in the majority of the
interviews offer extensive possibilities for engaging in commercial practices To compete with
other platforms the major social media are also continuously creating new possibilities for
advertisers and traders which they promote through sales persons and tutorials
Among these new functionalities are extensive options for targeting advertisements The main
OSM platforms allow targeting based on information contained in the registered user profile
interest-related data and behavioural data A relatively new feature of targeting is the use of
custom audiences by targeting clients in the companyrsquos database on OSM platforms by
matching contact information Another example is the creation of lookalike audiences which
allows the targeting of new users who have similar characteristics as a specified group of
individuals Additionally it is also possible to target users who have visited a particular website
outside of the OSM platform Hence targeting through OSM platforms can be based on very
specific individual properties and behaviour
Because the targeting options are extensive advertisers sometimes chose to cooperate with
intermediaries Traders value intermediaries because of their expertise in both marketing
strategies and platform functionalities Intermediaries are therefore primarily used when
setting up a campaign that is complex in terms of targeting format or content Furthermore
intermediaries may also handle the creation of content and communication through OSM on
behalf of the client Finally certain intermediaries offer software facilitating social media
advertising and evaluating campaign effectiveness These additional features are made
possible because the intermediaries make use of the platformsrsquo API (application programming
interface) to provide data These additional statistics tap into the need for better metrics The
interviewed advertisers indicated that the statistics provided by the social media platforms are
not always adequate Even though the data are detailed the B2B clients and intermediaries
EUROPEAN COMMISSION
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indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
EUROPEAN COMMISSION
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In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 20 EN
10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 21 EN
Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 22 EN
102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
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Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
Directorate-General for Consumers
2018 EUR 2 EN
EUROPEAN COMMISSION
Produced by Consumers Health Agriculture and Food Executive Agency (Chafea) on behalf of
Directorate-General for Justice and Consumers
Unit 03 Economic analysis and evaluation
Contact Unit 03
E-mail JUST-03eceuropaeu
European Commission
B-1049 Brussels
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 3 EN
Behavioural Study on
Advertising and Marketing
Practices in
Online Social Media
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 4 EN
LEGAL NOTICE
This report was produced under the EU Consumer Programme (2014-2020) in the frame of a specific contract with
the Consumers Health Agriculture and Food Executive Agency (Chafea) acting on behalf of the European
Commission
The content of this report represents the views of GfK Belgium and is its sole responsibility it can in no way be taken
to reflect the views of the European Commission andor Chafea or any other body of the European Union
The European Commission andor Chafea do not guarantee the accuracy of the data included in this report nor do
they accept responsibility for any use made by third parties thereof
Project number 20183823
Title Stakeholder survey
Language version FormatVolume Catalogue number ISBN DOI
EN PDF PDFVolume_01 EB-01-18-688-EN-N 978-92-9200-939-7 102818693859
copy European Union 2018
Reproduction is authorised provided the source is acknowledged
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 5 EN
Table of Contents
1 Introduction 6
2 Methodology 6
3 Types of commercial practices and role of industry stakeholders 6
31 Commercial practices 6
32 The role of Intermediaries and B2B clients 7
4 The role of OSM providers 8
41 Approval of content 8
42 Format and functionalities 9
43 Targeting 10
5 New functionalities 10
51 Identified trends 10
52 Potential problems and benefits for consumers 11
6 Misleading practices and remedies 12
61 Types of misleading practices 12
62 Remedies 14
7 Issues and complaints 14
71 Consumers 15
72 B2B clients 15
8 Actions by enforcement authorities 15
9 Conclusions 17
91 Novel commercial practices on social media 17
92 Potentially misleading practices identified by stakeholders 18
93 The role of OSM providers in the approval process formats and functionalities 18
94 Remedies proposed by industry stakeholders 19
10 Appendix 20
101Appendix 1 List of stakeholders interviewed 20
102Appendix 2 Stakeholder survey ndash interview guide 22
103Appendix 3 Briefing on misleading commercial practices 26
104Appendix 4 Analysis ndash Empty grid used for analysis 28
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 6 EN
1 Introduction
The following section describes the results of the stakeholder survey with six types of relevant
stakeholders B2B clients (14) local intermediaries (13) global intermediaries (11) consumer
organisations (3) advertisers organisations (8) and academics (4) OSM providers were also
contacted for participation in the survey although only a single OSM provider participated in
the research This interview was discarded as the response from a single respondent did not
allow a separate analysis of the OSM providersrsquo views on the topic
B2B clients are organisations that engage in commercial practices directly through social media
They have a business-to-business relationship with the online social media providers In
contrast the end client can also appeal to intermediaries which act as a third party facilitating
commercial practices through social media In this case the end client does not engage directly
with the social media providers The stakeholders listed in Appendix 1 were interviewed about
their perspective on commercial practices through online social media These views are
summarised below with regard to the following key research topics
- The main topics of the interview concerned
- Commercial practices on OSM
- Novel functionalities and trends
- Potential concerns and benefits for consumers
- Misleading unfair and problematic commercial practices on OSM
- Potential remedies
- The roles of the stakeholders in the approval format and functionalities of marketing
content in OSM
- User issues and complaints
2 Methodology
Stakeholders were approached through GfK contacts in the sector contacts found through desk
research and interactions with consumer and advertiser associations The actors contacted
were invited for an open-ended telephone interview In total 53 interviews were conducted by
researchers dedicated to the project All interviews were recorded for further analysis
An interview guide was used to structure the 30- to 40-minute conversations containing open-
ended questions on the key topics At the start of the interview the respondents received
information on the context of the study Furthermore consent was obtained to report their
company name and to record the interview for analysis After the fieldwork the recordings
were summarised in a specific grid created for data analysis which was based on the key
research dimensions This grid included in Appendix 4 guided the analysis of the interviews
and the subsequent report-writing phase
3 Types of commercial practices and role of industry stakeholders
31 Commercial practices
Companies and organisations can engage in various types of commercial practices through
online social media The stakeholders interviewed differentiate two broad types of activities
posting lsquoorganicallyrsquo and engaging in lsquomarketingrsquo The former encompasses publishing
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 7 EN
interesting content without paying for it (eg posting stories or news on a companyrsquos own
social media page) the latter includes all types of payed-for commercial practices ndashsee below
Within marketing the type of practices used depends on the stage of the marketing process
The stakeholders first identify the lsquoawarenessrsquo stage (also called branding) in which the aim is
to reach a broad audience and provide them with an impression of a productservice Posting
pictures or video is suited in this phase as well as publishing an advertorial (ie a sponsored
article to be posted on social media) Intermediaries or B2B clients may for instance invest in
Facebook banner ads Sponsored Instagram ads Promoted pins on Pinterest or a skippable
lsquoprerollrsquo video on YouTube The focus in this phase is on reaching a certain number of users in
a certain amount of time and it can be linked to any type of engagement with an offer clicking
on it studying it liking it etcetera
A second phase in advertising concerns the conversion phase (also called performance) The
goal in this phase is to promote a specific productservice and to sell it More precise targeting
is therefore essential in this phase It can be accomplished by targeting on demographics or
interests remarketing (taking into account which productsservices the user researched
outside the OSM platform) targeting based on a list of users (from a company database from
individuals who subscribed to receive updates etcetera) For the actual purchase of the
productservice social media provide the opportunity of linking to a product page or facilitating
shopping through the social media platform (eg advertisers can add a shop section to a
brandrsquos Facebook page)1
In addition to those listed under the aforementioned phases of advertising certain other
commercial practices were discussed in the stakeholder interviews These practices include
paying social influencers for promoting productsservices managing (as an intermediary)
the social media pages and communities of brands and analysing what users are saying
about brands on social media These services are not offered by the OSM providers but by
third parties such as individual social influencers or intermediaries
32 The role of Intermediaries and B2B clients
For organisations that wish to engage in commercial practices on social media the possibilities
and options are plentiful To make the right decisions in terms of targeting content and general
strategy these organisations can turn to intermediaries A B2B client explains that it depends
on the budget and complexity of a campaign whether they set it up on their own or involve an
advertising company If the budget is high and the project is complex ndash in terms of targeting
format content or otherwise ndash an intermediary is more likely to become involved
This indicates the first role of intermediaries which is to provide advice to organisations that
aim to advertise through social media The intermediaries have expertise in both the functions
of social media platforms as well as in marketing strategies Offering this combined expertise
is an added value for their clients For this reason an interviewed B2B client values the
involvement of intermediaries
ldquoThe thing [intermediaries] got ndash and theyrsquore really so important for that ndash they got all
the knowledge about all the Facebook products about what works fine and what
doesnrsquot work fine They give us quite a bit of advice on what we should push on
1 On Facebook advertisers can set up a shop section and include a ldquoMessage to Buyrdquo button allowing consumers to indicate products they are interested in purchasing For the payment of the order users will be redirected to the merchantrsquos website as the option of payment through the Facebook platform is not (yet) available in the EU httpswwwfacebookcombusinesshelp912190892201033
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2018 EUR 8 EN
Facebook Twitter and YouTube as well So theyrsquove got all the knowledge and quite a
lot of experience with itrdquo
Second local and global intermediaries can have an important role in reaching the right target
groups and optimising the strategy for targeting audiences As the targeting options on social
media are extensive advertisers sometimes hire an intermediary to set up a campaign For
instance one of the interviewed B2B clients hired a marketing agency (as intermediary) to set
up the targeting of specific groups The intermediary in this case helped the client to take the
first steps in advertising through social media
Furthermore a subgroup of intermediaries offers software that facilitates advertising through
online social media or assessing the effectiveness of campaigns For example one of the
intermediaries has created software that assists in buying advertising space on Facebook
creating campaigns setting up target audiences etcetera Their software package can be
considered an efficiency tool which saves time for the end clients and allows them to advertise
on Facebook at a greater scale Other intermediaries create software for acquiring more
detailed metrics on campaigns and advanced statistics on the outcomes For instance an
intermediary offers a tool that shows the performance of an advertisement across multiple
platforms One of the interviewed academic furthermore refers to a software called Ditto that
analyses social media images for visual cues on brands and emotions These examples have in
common that they take advantage of the data available through social media and construct
more advanced metrics than those offered on the OSM platform
Finally intermediaries can take up the creation of content (visuals and texts) for social media
campaigns or they may handle all communication through social media of behalf of their client
(ie social media management) With regard to the control of contents and formats the
intermediaries indicate that their end client has the final word in approving the approach
Nevertheless a local intermediary remarked that their company would not assist costumers
that aim to place misleading ads or performs aggressive targeting
The aforementioned examples show that clients may cooperate with intermediaries in a variety
of cases In other instances however organisations choose to set up their campaigns
themselves For the majority of the interviewed B2B clients his implies using the platform tools
without any personal assistance Only B2B clients that have a large budget to spend on social
media advertising (or that represent highly popular brands) can rely on a direct contact person
(account manager) in the major social media As a B2B client phrases this
Were trying to reach out to [Facebook] to have a personalised relationship so that
we can ask stuff But thats only for top-tier clients that have like five million likes or
something They have an account manage but for us we dont have one yet
At least five B2B clients among the interviewed representatives do have account managers
For these companies the account managers offer a more accessible means of communication
with the OSM providers The companies tend to correspond with them mainly at the start of a
campaign or when a campaign is more complex
4 The role of OSM providers
41 Approval of content
Stakeholders indicate that social media providers have rules about what is accepted and not
accepted in an advertisement Facebook and Twitter for instance explicitly promote these
rules to advertisers For Facebook their policy concerns violence sexuality alcohol and drugs
EUROPEAN COMMISSION
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2018 EUR 9 EN
Moreover it also forbids lsquoclickbaitrsquo and images that contain over 20 percent of text Google
(YouTube) is quite strict in terms of regulating nudity in videos and LinkedIn also performs
automated checks on advertisements (eg the platforms restricts the use of capitalised
words) Overall the stakeholders have the impression that the rules on advertising in online
social media are quite strict A local intermediary adds that the rules have become more
restrictive over time in the beginning almost everything could have been posted online
whereas now it is more limited the intermediary reports
In practice when submitting an advertisement on Facebook it is checked through an
automated process Within 10 minutes the advertiser is notified whether the ad was
approved or rejected In case the advertiser disagrees with a rejection he or she can send
feedback after which someone will check the concerned advertisement Despite this automated
check the intermediaries and B2B clients indicate that Facebook cannot possibly check every
aspect of an ad as the volume is very high There is however a second mechanism through
which users can report problematic advertisements after they are published Ads on Facebook
feature reporting buttons and other means for all users to provide feedback A B2B client
explains that Facebook bases the price of a campaign on how successful it is (ie the number
of times it is liked by users) and to what extent it receives negative user reports If
advertisements are unsuccessful or frequently reported by users Facebook will increase the
price for the advertiser or ask the advertiser to make changes to the advertisement (in terms
of content pictures or wording) to increase its attractiveness It is furthermore reported that
negative user feedback can lead to the shutdown of campaigns
42 Format and functionalities
In terms of formats and functionalities social media are constantly innovating and
creating new marketing possibilities These new options are promoted towards
advertisers for instance by providing online trainings about the new features informing
advertisers through sales people or offering price incentives Through these methods for
instance Facebook has promoted video as an advertising format in order to compete with other
platforms most notably YouTube
The social media providers are balancing their need to offer new options and the trust of their
platform users For this purpose there are certain limitations to the formats For instance
when content is sponsored Facebook adds a label to the ad Users can also typically report an
advertisement when they think the format or contents are inappropriate (see also ldquoApproval of
contentrdquo)
In terms of functionality social media providers offer information about which users are
targeted These data are always anonymous as a global intermediary indicates
ldquoWe only get information about masses of people The only reason why we get this
kind of information is to make our message more relevant for peoplerdquo
Even though the provided metrics are very detailed (indicating language age
location ethnicity interests etcetera) they are only visible for segments of 1000 to
2000 users From the perspective of intermediaries and B2B clients this renders the metrics
somewhat unsatisfying A B2B client notes that if metrics were more granular it would be
easier to target the right users making them more satisfied An academic concurs that the
metrics are relatively high-level and suggests that OSM providers could give more information
about the number of individuals actually targeted compared to the desired target size On the
YouTube metrics a local intermediary remarks that they are poorly organised and highlight
mainly the number of ldquoclicksrdquo whereas not all clicks will bring the user to the advertisers
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website As an experienced user in advertising the intermediary adds one can create custom
reports and custom setting on YouTube resulting in metrics that are more useful
43 Targeting
The intermediaries and B2B clients indicate that the OSM providers have an important role in
providing targeting possibilities They offer the underlying data deliver the targeting options
design the settings and provide statistics The interviewees indicate that they receive
automated suggestions through the online interfaces for entering target groups All
the major social media providers (Facebook Google Twitter) offer this type of advice For
instance when an advertiser selects a keyword for targeting in Twitter the online interface will
suggest related keywords The possibilities are also extensive allowing to select specific target
groups A critique however is that the advertisers cannot verify whether the right profiles are
selected for a certain target group and if the right individuals have been reached In this regard
they have to trust the platform owners
Three types of information are used for targeting profile information (the demographic
and other data that users provide) interest-related data (based on for instance likes and
group membership) and behavioural data (based on what users do ie their location
browsing behaviour etcetera) Facebook is indicated to be most advanced in terms of the
offered targeting options as this platform has most data on its users The targeting can be
based on liked brands or pages watched picturesvideos activity on webpages outside
Facebook device location etcetera Furthermore YouTube is also mentioned as a well-
developed platform for targeting advertisements In addition certain platforms are
preferred to target broad groups of individuals For example Snapchat is well suited to
reach younger people whereas Instagram is more appropriate for targeting women Several
new targeting methods have been developed recently which will be discussed in more detail
in the following section
5 New functionalities
51 Identified trends
Social media offer many new possibilities in terms of commercial practices Firstly targeting
is a prime area for which new functionalities were identified In general the interviewees note
that targeting is becoming increasingly more sophisticated and efficient Two specific features
of Facebook were often named custom audiences and lookalike audiences The former
implies that companies use their client database (eg a CRM database containing e-mail
addresses or phone numbers) to specifically target the individuals in this database The
latter lookalike audiences is a functionality that allows targeting new users who have
similar characteristics as a specified group of individuals Performance metrics on these
targets could possibly be much more detailed down to the level of the individual but Facebook
does not allow metrics on custom audiences of fewer than 1000 individuals2
2 The Facebook Advertiser Help Center mentions this limitation with regard to metrics (Audience
Insights) on custom audiences httpswwwfacebookcombusinesshelp580994405331939
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Other novel types of targeting that were mentioned include remarketing (advertising based on
a usersrsquo visit of websites outside the OSM platform) and the linking of data from different
platforms An example of database linking includes the use of Facebook data to target users
on Instagram or the linking of Facebook and WhatsApp data
Additionally new functionalities in terms of formats were discussed The B2B clients and
intermediaries identified an increase in integration of content and advertising For
example commercial messages are more often being shown inside content space and
advertisement labelling has sometimes become less conspicuous Formats also
increasingly focus on keeping users on the social media platform instead of redirecting
them to other websites An example is the canvas advertisement on Facebook which is
essentially a small web page that users can navigate while staying on the Facebook platform
Furthermore video content is seen as an increasingly important format A global intermediary
confirms that videos are better received by consumers and yield better results compared to
traditional advertisements Finally important new indirect ways of advertising were identified
such as promoting brands through social influencers or having lsquonormalrsquo users promote
brands (eg by offering sponsored lenses (or lsquoframesrsquo) which individuals can apply to their
Snapchat pictures)
New functionalities were also observed with regard to metrics and statistics Firstly
advertisers can increasingly link their online advertisements to purchases A local
intermediary explains that when an item is promoted on multiple OSM platforms the
advertiser can determine from which platform the buyer arrived at the sellerrsquos website Second
new software can generate statistics that go beyond the overviews offered by the social media
platforms This software is provided to advertisers and intermediaries and collects the data
through the APIs of the social media platforms (eg Facebook and Twitter) One of the
interviewed intermediaries creates software that enables advertisers to assess which ads work
best with what audiences Another type of technology referred to by a global intermediary
measures what types of emotions are expressed through comments on commercial messages
Overall the advanced analysis by intermediaries of large amounts of raw data provided by
social media platforms is considered as an important new functionality
52 Potential problems and benefits for consumers
With the extensive options in terms of targeting and data usage privacy was often discussed
as a main concern More specifically critique was expressed on the use of client databases for
targeting on social media A local intermediary remarks that not all individuals in a company
database may have opted-in for targeting through social media Consumers may not be fully
aware that contact information collected ldquoofflinerdquo may be used for commercial
practices on social media As an academic notes this can be potentially worrisome
ldquoWhen I gave my phone number e-mail address or physical address I wouldnrsquot expect
those businesses to be able to track me on Facebook and target me with ads but now
they can That is a troubling new functionalityrdquo
Furthermore the practice of remarketing can be perceived as problematic in some cases A
local intermediary argues that retargeting may not be desirable for all products and users may
not wish their purchases (or purchase intentions) to be displayed on-screen Finally in addition
to being perceived as lsquospookyrsquo or lsquoscaryrsquo sophisticated targeting can be problematic when
different individuals are shown different offers (price discrimination) or when certain individuals
are excluded from offers With regard to the latter a consumer organisation identified a
particular risk in insurance companies that chose to advertise only to low-risk individuals (for
instance by targeting users based on their educational level) In terms of formats
commercial messages that look like regular content have the potential to mislead
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consumers Two advertisers organisations name this practice as particularly
problematic In their view consumers should not be misled by an ad that looks like editorial
content As one organisation adds it is especially problematic when such an advertisement
reaches young people who may not possess the background knowledge to discern ads from
editorial content Moreover it is problematic when advertisements are integrated into the social
interaction among users It can be perceived as highly intrusive to see an advertisement
between the Snapchat stories of friends or among private messages on Facebook In addition
to the aforementioned downsides certain benefits of more advanced targeting and data usage
were put forward by a broad range of interviewed actors The displayed advertisements are
more interesting and relevant for the social media users Because the content is more relevant
individuals will be less inclined to feel bothered by hem and instead appreciate the commercial
practices For the same reason the targeted messages may add value for consumers rather
than cause annoyance As a global intermediary summarises
ldquoIn a world where we get so many messages its [about] being relevant [in] what you
say being relevant about the type of product for a certain type of peoplerdquo
6 Misleading practices and remedies
61 Types of misleading practices
The interviewed representatives of B2B clients and Intermediaries indicate that they witnessed
only few instances of clearly misleading practices on the large social media They argue that
social media aim to avoid such misleading advertisements as they do not wish to upset users
Since advertising is a crucial element in their business model social media are very careful
about which advertising they show When prompted however the interviewed B2B clients and
Intermediaries were able to provide examples of misleading problematic and unfair commercial
practices Additional information is provided by consumer organisations and academics who
played particular attention to user data collected by social media They also referred to cases
of malware phishing and misleading promotions The types of misleading commercial practices
that are reported can be classified under the following five categories
Disguised marketing
First an often-mentioned problem is the difficulty to recognise advertising on social media
In part the difficulty to identify ads is related to their format For example on Facebook the
difference between sponsored content and user content is very subtle On Twitter as well it is
difficult to know if content is paid for when browsing hashtags A B2B client suggests that social
media purposefully integrate advertising and content
ldquoOn Facebook it is signalled when content is sponsored but it is not very
obvious and this is on purpose because Facebook does not want to show so
clearly that it is an ad
Furthermore commercial practices are sometimes difficult to recognise because the
commercial nature is not disclosed For example the presence of product placement may not
always be clearly labelled or indicated A specific case in this regard are social influencers
Celebrities or individuals who are popular on social media may be paid by brands to mention
or promote their products When they do not disclose being paid this can be misleading
towards consumers The latter problem is mentioned by several intermediaries and an
advertising self-regulatory body The advertisersrsquo organisation indicates that social influencers
are posting sponsored messages on social media but that they are not necessarily following
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the rules set out by self-regulatory bodies (ICC) and by the European Commission (UCPD) It
is argued that such failures may be due to inexperience and lack of familiarity with the existing
rules rather than a conscious intent not to adhere to them
Misleading marketing content
A second type of problematic commercial practice concerns misleading or incorrect product
or price descriptions This includes advertising with misleading information about the price
of a product (eg claiming something is free when it is not) the qualities of the product or
incorrectly claiming that an offer is limited in time This type of misinformation also includes
social media campaigns that are referring to a promotion which is no longer valid
Intermediaries and B2B clients further mentioned that product endorsements by social media
users may not always be fully genuine as they could be part of a lsquoshare and winrsquo or lsquolike and
winrsquo action
Undesirable or improper user targeting
Undesirable or improper user targeting is a third important problematic commercial practice
Several B2B clients and intermediaries mention that many users are unaware of how they are
being tracked and how this affects the advertisements that they see The fact that advertising
is personalised and targeted at specific groups without the users being fully knowledgeable
about it is perceived as problematic by an interviewed academic For example many social
media users may not be aware of any behavioural tracking that occurs (eg platforms tracking
the usersrsquo activities on their website and on many other websites that users visit) It implies
that users may not have been sufficiently informed to give consent to this type of tracking
Furthermore brands can advertise to users who have never lsquolikedrsquo the brandrsquos page or have
no interest in the brand at all (for instance by inserting advertisements on their Facebook News
Feed) A B2B client explains that this practice can make users angry based on individual
comments on the companyrsquos Facebook posts and private messages received through Facebook
Targeting can also fail when it is based on inaccurate information or wrong assumptions Users
may for instance be targeted with products they have already bought
Processing of private data
Fourthly participants in the stakeholder survey indicate that it is problematic when very
private data is not processed transparently Social media collect many different types of
information about their users including profile data activities on the platform real-world
location et cetera How these data are used however is not entirely clear to users The B2B
clients and consumer organisations expressed concern about what data is stored how safe it
is stored and whom it is shared with A consumer organisation mentioned that online social
media do not limit the storage of data in time ie it is stored indefinitely The same
organisation also points out a problematic example of a mobile phone banking app which sends
information to Facebook without notifying its users With WhatsApp being part of Facebook a
local intermediary finds it increasingly unclear which information shared with others is still
private and which can also be used for commercial purposes
Aggressive or criminal practices
A final type of problematic commercial practices concern cases of aggressive or criminal
practices Although the stakeholders indicated that criminal practices are not widespread on
social media they did refer to scams phishing and other illegal activities One particular
example provided by a global intermediary concerns a fake airline profile on social media
which promised that a user can win euro3000 by sharing a message These profile pages receive
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a high amount of visitors and can afterwards be sold on the black market Other cases
mentioned in two B2B interviews are about lsquoaggressiversquo advertisements and aggressive phone
calls after entering contact details on social media
62 Remedies
Various remedies are suggested to counter the aforementioned misleading unfair or
problematic practices The stakeholders interviewed see a role for advertisers social media
users platform owners and governments Intermediaries and B2B clients recognise their role
as advertisers to engage in fair commercial practices that are relevant for consumers In
addition these actors also point out the responsibilities of social media users The latter have
the ability to shape their online advertising environment by indicating which advertisements
they like or do not like As a global intermediary summarises it
ldquoId rather see something that I like or might like instead of tampon commercials So
you yourself [as a user] can make that ad environment just better and more personal
So why wouldnrsquot yourdquo
Furthermore users can report the ads that they find problematic through the automated
reporting on social media The interviewed intermediaries and B2B clients strongly encourage
this
Nevertheless social media providers also have a role in this process Certain B2B clients
and intermediary stakeholders indicate that it is unclear how complaints and reports are
handled Social media providers could be more lsquohands-onrsquo in dealing with user complaints and
when approving advertising Even though the platform owners do not have the capacity to
manually check every advertisement the interviewed advertisers stress the importance of
having a human being (in addition to a computer system) estimate which practices are
acceptable and which are not Furthermore a self-regulatory advertising body proposes that
social media immediately take down advertisements when the self-regulatory body has decided
that they are not acceptable
From the interviews with the different types of stakeholders three key steps to be taken by
social media providers emerged (1) simplify their terms and conditions as well as privacy
policy and present these terms to users in a clear and understandable way (2) label advertising
more prominently and ensure that the same wordingformatting is used throughout the entire
platform and (3) offer more options as opt-in features rather than opt-out With regard to the
first aspect a consumer organisation argues that If the terms of services are not available
and not understandable then its impossible to get an actual consent from the consumer
Finally certain participants in the survey identified a role for governments An intermediary
and consumer organisation suggest that governments (eg on a European level) should
monitor commercial practices performed on online social media and track new technologies
that could potentially violate consumer rights In terms of the current commercial practices on
social media the interviewees from different stakeholder categories identified the need for
laws on privacy and data protection to be adapted to the current practices on social
media Finally legislation is requested to ensure that social influencers are required to
disclose when they are being paid for certain messages With regard to the latter a global
intermediary adds the following
ldquoJust like we have to do on TV and say there is product placement in the TV
show you should be obliged to do it on your social mediardquo
7 Issues and complaints
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71 Consumers
Consumers have different means of complaining about problematic commercial practices on
social media The most common channel to voice complaints is through the social media
platforms themselves On Facebook users may for instance click negative emoticons post
comments or report the advertisement Less commonly private messages can also be sent
to advertisers Depending on the situation either social media providers deal with a complaint
(eg for complaints expressed through the reporting tool) or the advertiser handles it (eg
for complaints communicated through comments or private messages) Consumers almost
never address their complaints to intermediaries because for social media users it is not visible
which intermediaries are behind a campaign Intermediaries may deal with user complaints in
the name of their end clients or they may forward the complaints to their clients Certain
intermediaries are not at all involved in dealing with user complaints for example
intermediaries which offer software for metrics Some actors use a very structured approach
in answering user feedback One of the interviewed B2B clients makes use of a flow chart to
identify which actions to take in case of user positive neutral or negative consumer response
on social media
The interviewed B2B clients intermediaries and consumer organisations primarily identified
user complains concerning the high number of advertisements (lsquospammingrsquo or lsquopolluting their
contentrsquo) the targeting of commercial practices (mistargeting showing irrelevant ads or re-
targeting advertisement) and the difficulty to identify advertising and discern it from other
content With regard to the latter an advertising self-regulating body reports an
increase in the complaints about social influencers who do not clearly identify which
of their activities are sponsored
72 B2B clients
The issues and complaints that advertisers have are related to the social media platforms
Nevertheless the number of complaints is very limited When issues do arise they are
sometimes related to the platform disapproving an advertiserrsquos campaign without a clear
reason the complexity of the options when advertising on social media and the difficulty of
working with the platformrsquos API (Application Programming Interface)
8 Actions by enforcement authorities
Involvement of enforcement authorities was not a common action when dealing with
problematic commercial practices An important explanation for this is that ndash as multiple
stakeholders indicated ndash going to court takes time It is far more likely that a consumer
complaint is resolved by the advertising company or that a self-regulatory body is involved
The German advertising self-regulator pointed out that their process is much faster than a
court procedure However when the regulator lacks resources or when the complaint deals
with criminal activities the issue is taken to the enforcement authorities
When enforcement authorities are involved it usually concerns the most serious complaints
Examples mentioned by the interviewees include cases about criminal activities (Germany)
alcohol advertising (Poland) data collection (Italy) and out-of-stock products (Belgium) In
many of the cases mentioned in the interviews the government was involved by filing a
complaint against certain commercial practices
Whereas investigations against social influencers are not common in Europe the United States
enforce a more extensive legislation on this topic A respondent from a global intermediary was
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aware of a case in the United States where the legal authorities had fined YouTube influencers
for not disclosing sponsorship
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9 Conclusions
The stakeholder survey is part of subtask 14 which aimed to investigate marketing practices
on online social media from a traderrsquos point of view The survey consisted of 50 in-depth
interviews of stakeholders belonging to relevant subgroups with different perspectives and
explored the roles and responsibilities of OSM providers and other actors in the commercial
practices on their platforms More specifically the stakeholder survey aimed to acquire
information about which commercial practices can be found on social media and in what way
certain practices may be misleading unfair or problematic for consumers Additionally the
views of the different stakeholders were assessed and compared as well as their role in the
commercial practices
Types of commercial practices on social media
The stakeholders interviewed differentiate two broad types of activities
- Posting lsquoorganicallyrsquo publishing interesting content without paying for it
- Performing lsquomarketingrsquo engaging in payed-for commercial practices
Additional practices emerged during the interviews including paying social influencers for
promoting products or services managing the social media pages or communities of brands
and analysing what is being said about brands on social media These services can be offered
by local or global intermediaries or by individual social influencers
91 Novel commercial practices on social media
Throughout the stakeholder interviews different functionalities and targeting methods on social
media were discussed The four largest OSM platforms covered in the majority of the
interviews offer extensive possibilities for engaging in commercial practices To compete with
other platforms the major social media are also continuously creating new possibilities for
advertisers and traders which they promote through sales persons and tutorials
Among these new functionalities are extensive options for targeting advertisements The main
OSM platforms allow targeting based on information contained in the registered user profile
interest-related data and behavioural data A relatively new feature of targeting is the use of
custom audiences by targeting clients in the companyrsquos database on OSM platforms by
matching contact information Another example is the creation of lookalike audiences which
allows the targeting of new users who have similar characteristics as a specified group of
individuals Additionally it is also possible to target users who have visited a particular website
outside of the OSM platform Hence targeting through OSM platforms can be based on very
specific individual properties and behaviour
Because the targeting options are extensive advertisers sometimes chose to cooperate with
intermediaries Traders value intermediaries because of their expertise in both marketing
strategies and platform functionalities Intermediaries are therefore primarily used when
setting up a campaign that is complex in terms of targeting format or content Furthermore
intermediaries may also handle the creation of content and communication through OSM on
behalf of the client Finally certain intermediaries offer software facilitating social media
advertising and evaluating campaign effectiveness These additional features are made
possible because the intermediaries make use of the platformsrsquo API (application programming
interface) to provide data These additional statistics tap into the need for better metrics The
interviewed advertisers indicated that the statistics provided by the social media platforms are
not always adequate Even though the data are detailed the B2B clients and intermediaries
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indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
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In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
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10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 21 EN
Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 22 EN
102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 24 EN
Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
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Behavioural Study on
Advertising and Marketing
Practices in
Online Social Media
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 4 EN
LEGAL NOTICE
This report was produced under the EU Consumer Programme (2014-2020) in the frame of a specific contract with
the Consumers Health Agriculture and Food Executive Agency (Chafea) acting on behalf of the European
Commission
The content of this report represents the views of GfK Belgium and is its sole responsibility it can in no way be taken
to reflect the views of the European Commission andor Chafea or any other body of the European Union
The European Commission andor Chafea do not guarantee the accuracy of the data included in this report nor do
they accept responsibility for any use made by third parties thereof
Project number 20183823
Title Stakeholder survey
Language version FormatVolume Catalogue number ISBN DOI
EN PDF PDFVolume_01 EB-01-18-688-EN-N 978-92-9200-939-7 102818693859
copy European Union 2018
Reproduction is authorised provided the source is acknowledged
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 5 EN
Table of Contents
1 Introduction 6
2 Methodology 6
3 Types of commercial practices and role of industry stakeholders 6
31 Commercial practices 6
32 The role of Intermediaries and B2B clients 7
4 The role of OSM providers 8
41 Approval of content 8
42 Format and functionalities 9
43 Targeting 10
5 New functionalities 10
51 Identified trends 10
52 Potential problems and benefits for consumers 11
6 Misleading practices and remedies 12
61 Types of misleading practices 12
62 Remedies 14
7 Issues and complaints 14
71 Consumers 15
72 B2B clients 15
8 Actions by enforcement authorities 15
9 Conclusions 17
91 Novel commercial practices on social media 17
92 Potentially misleading practices identified by stakeholders 18
93 The role of OSM providers in the approval process formats and functionalities 18
94 Remedies proposed by industry stakeholders 19
10 Appendix 20
101Appendix 1 List of stakeholders interviewed 20
102Appendix 2 Stakeholder survey ndash interview guide 22
103Appendix 3 Briefing on misleading commercial practices 26
104Appendix 4 Analysis ndash Empty grid used for analysis 28
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 6 EN
1 Introduction
The following section describes the results of the stakeholder survey with six types of relevant
stakeholders B2B clients (14) local intermediaries (13) global intermediaries (11) consumer
organisations (3) advertisers organisations (8) and academics (4) OSM providers were also
contacted for participation in the survey although only a single OSM provider participated in
the research This interview was discarded as the response from a single respondent did not
allow a separate analysis of the OSM providersrsquo views on the topic
B2B clients are organisations that engage in commercial practices directly through social media
They have a business-to-business relationship with the online social media providers In
contrast the end client can also appeal to intermediaries which act as a third party facilitating
commercial practices through social media In this case the end client does not engage directly
with the social media providers The stakeholders listed in Appendix 1 were interviewed about
their perspective on commercial practices through online social media These views are
summarised below with regard to the following key research topics
- The main topics of the interview concerned
- Commercial practices on OSM
- Novel functionalities and trends
- Potential concerns and benefits for consumers
- Misleading unfair and problematic commercial practices on OSM
- Potential remedies
- The roles of the stakeholders in the approval format and functionalities of marketing
content in OSM
- User issues and complaints
2 Methodology
Stakeholders were approached through GfK contacts in the sector contacts found through desk
research and interactions with consumer and advertiser associations The actors contacted
were invited for an open-ended telephone interview In total 53 interviews were conducted by
researchers dedicated to the project All interviews were recorded for further analysis
An interview guide was used to structure the 30- to 40-minute conversations containing open-
ended questions on the key topics At the start of the interview the respondents received
information on the context of the study Furthermore consent was obtained to report their
company name and to record the interview for analysis After the fieldwork the recordings
were summarised in a specific grid created for data analysis which was based on the key
research dimensions This grid included in Appendix 4 guided the analysis of the interviews
and the subsequent report-writing phase
3 Types of commercial practices and role of industry stakeholders
31 Commercial practices
Companies and organisations can engage in various types of commercial practices through
online social media The stakeholders interviewed differentiate two broad types of activities
posting lsquoorganicallyrsquo and engaging in lsquomarketingrsquo The former encompasses publishing
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 7 EN
interesting content without paying for it (eg posting stories or news on a companyrsquos own
social media page) the latter includes all types of payed-for commercial practices ndashsee below
Within marketing the type of practices used depends on the stage of the marketing process
The stakeholders first identify the lsquoawarenessrsquo stage (also called branding) in which the aim is
to reach a broad audience and provide them with an impression of a productservice Posting
pictures or video is suited in this phase as well as publishing an advertorial (ie a sponsored
article to be posted on social media) Intermediaries or B2B clients may for instance invest in
Facebook banner ads Sponsored Instagram ads Promoted pins on Pinterest or a skippable
lsquoprerollrsquo video on YouTube The focus in this phase is on reaching a certain number of users in
a certain amount of time and it can be linked to any type of engagement with an offer clicking
on it studying it liking it etcetera
A second phase in advertising concerns the conversion phase (also called performance) The
goal in this phase is to promote a specific productservice and to sell it More precise targeting
is therefore essential in this phase It can be accomplished by targeting on demographics or
interests remarketing (taking into account which productsservices the user researched
outside the OSM platform) targeting based on a list of users (from a company database from
individuals who subscribed to receive updates etcetera) For the actual purchase of the
productservice social media provide the opportunity of linking to a product page or facilitating
shopping through the social media platform (eg advertisers can add a shop section to a
brandrsquos Facebook page)1
In addition to those listed under the aforementioned phases of advertising certain other
commercial practices were discussed in the stakeholder interviews These practices include
paying social influencers for promoting productsservices managing (as an intermediary)
the social media pages and communities of brands and analysing what users are saying
about brands on social media These services are not offered by the OSM providers but by
third parties such as individual social influencers or intermediaries
32 The role of Intermediaries and B2B clients
For organisations that wish to engage in commercial practices on social media the possibilities
and options are plentiful To make the right decisions in terms of targeting content and general
strategy these organisations can turn to intermediaries A B2B client explains that it depends
on the budget and complexity of a campaign whether they set it up on their own or involve an
advertising company If the budget is high and the project is complex ndash in terms of targeting
format content or otherwise ndash an intermediary is more likely to become involved
This indicates the first role of intermediaries which is to provide advice to organisations that
aim to advertise through social media The intermediaries have expertise in both the functions
of social media platforms as well as in marketing strategies Offering this combined expertise
is an added value for their clients For this reason an interviewed B2B client values the
involvement of intermediaries
ldquoThe thing [intermediaries] got ndash and theyrsquore really so important for that ndash they got all
the knowledge about all the Facebook products about what works fine and what
doesnrsquot work fine They give us quite a bit of advice on what we should push on
1 On Facebook advertisers can set up a shop section and include a ldquoMessage to Buyrdquo button allowing consumers to indicate products they are interested in purchasing For the payment of the order users will be redirected to the merchantrsquos website as the option of payment through the Facebook platform is not (yet) available in the EU httpswwwfacebookcombusinesshelp912190892201033
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 8 EN
Facebook Twitter and YouTube as well So theyrsquove got all the knowledge and quite a
lot of experience with itrdquo
Second local and global intermediaries can have an important role in reaching the right target
groups and optimising the strategy for targeting audiences As the targeting options on social
media are extensive advertisers sometimes hire an intermediary to set up a campaign For
instance one of the interviewed B2B clients hired a marketing agency (as intermediary) to set
up the targeting of specific groups The intermediary in this case helped the client to take the
first steps in advertising through social media
Furthermore a subgroup of intermediaries offers software that facilitates advertising through
online social media or assessing the effectiveness of campaigns For example one of the
intermediaries has created software that assists in buying advertising space on Facebook
creating campaigns setting up target audiences etcetera Their software package can be
considered an efficiency tool which saves time for the end clients and allows them to advertise
on Facebook at a greater scale Other intermediaries create software for acquiring more
detailed metrics on campaigns and advanced statistics on the outcomes For instance an
intermediary offers a tool that shows the performance of an advertisement across multiple
platforms One of the interviewed academic furthermore refers to a software called Ditto that
analyses social media images for visual cues on brands and emotions These examples have in
common that they take advantage of the data available through social media and construct
more advanced metrics than those offered on the OSM platform
Finally intermediaries can take up the creation of content (visuals and texts) for social media
campaigns or they may handle all communication through social media of behalf of their client
(ie social media management) With regard to the control of contents and formats the
intermediaries indicate that their end client has the final word in approving the approach
Nevertheless a local intermediary remarked that their company would not assist costumers
that aim to place misleading ads or performs aggressive targeting
The aforementioned examples show that clients may cooperate with intermediaries in a variety
of cases In other instances however organisations choose to set up their campaigns
themselves For the majority of the interviewed B2B clients his implies using the platform tools
without any personal assistance Only B2B clients that have a large budget to spend on social
media advertising (or that represent highly popular brands) can rely on a direct contact person
(account manager) in the major social media As a B2B client phrases this
Were trying to reach out to [Facebook] to have a personalised relationship so that
we can ask stuff But thats only for top-tier clients that have like five million likes or
something They have an account manage but for us we dont have one yet
At least five B2B clients among the interviewed representatives do have account managers
For these companies the account managers offer a more accessible means of communication
with the OSM providers The companies tend to correspond with them mainly at the start of a
campaign or when a campaign is more complex
4 The role of OSM providers
41 Approval of content
Stakeholders indicate that social media providers have rules about what is accepted and not
accepted in an advertisement Facebook and Twitter for instance explicitly promote these
rules to advertisers For Facebook their policy concerns violence sexuality alcohol and drugs
EUROPEAN COMMISSION
Directorate-General for Consumers
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Moreover it also forbids lsquoclickbaitrsquo and images that contain over 20 percent of text Google
(YouTube) is quite strict in terms of regulating nudity in videos and LinkedIn also performs
automated checks on advertisements (eg the platforms restricts the use of capitalised
words) Overall the stakeholders have the impression that the rules on advertising in online
social media are quite strict A local intermediary adds that the rules have become more
restrictive over time in the beginning almost everything could have been posted online
whereas now it is more limited the intermediary reports
In practice when submitting an advertisement on Facebook it is checked through an
automated process Within 10 minutes the advertiser is notified whether the ad was
approved or rejected In case the advertiser disagrees with a rejection he or she can send
feedback after which someone will check the concerned advertisement Despite this automated
check the intermediaries and B2B clients indicate that Facebook cannot possibly check every
aspect of an ad as the volume is very high There is however a second mechanism through
which users can report problematic advertisements after they are published Ads on Facebook
feature reporting buttons and other means for all users to provide feedback A B2B client
explains that Facebook bases the price of a campaign on how successful it is (ie the number
of times it is liked by users) and to what extent it receives negative user reports If
advertisements are unsuccessful or frequently reported by users Facebook will increase the
price for the advertiser or ask the advertiser to make changes to the advertisement (in terms
of content pictures or wording) to increase its attractiveness It is furthermore reported that
negative user feedback can lead to the shutdown of campaigns
42 Format and functionalities
In terms of formats and functionalities social media are constantly innovating and
creating new marketing possibilities These new options are promoted towards
advertisers for instance by providing online trainings about the new features informing
advertisers through sales people or offering price incentives Through these methods for
instance Facebook has promoted video as an advertising format in order to compete with other
platforms most notably YouTube
The social media providers are balancing their need to offer new options and the trust of their
platform users For this purpose there are certain limitations to the formats For instance
when content is sponsored Facebook adds a label to the ad Users can also typically report an
advertisement when they think the format or contents are inappropriate (see also ldquoApproval of
contentrdquo)
In terms of functionality social media providers offer information about which users are
targeted These data are always anonymous as a global intermediary indicates
ldquoWe only get information about masses of people The only reason why we get this
kind of information is to make our message more relevant for peoplerdquo
Even though the provided metrics are very detailed (indicating language age
location ethnicity interests etcetera) they are only visible for segments of 1000 to
2000 users From the perspective of intermediaries and B2B clients this renders the metrics
somewhat unsatisfying A B2B client notes that if metrics were more granular it would be
easier to target the right users making them more satisfied An academic concurs that the
metrics are relatively high-level and suggests that OSM providers could give more information
about the number of individuals actually targeted compared to the desired target size On the
YouTube metrics a local intermediary remarks that they are poorly organised and highlight
mainly the number of ldquoclicksrdquo whereas not all clicks will bring the user to the advertisers
EUROPEAN COMMISSION
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website As an experienced user in advertising the intermediary adds one can create custom
reports and custom setting on YouTube resulting in metrics that are more useful
43 Targeting
The intermediaries and B2B clients indicate that the OSM providers have an important role in
providing targeting possibilities They offer the underlying data deliver the targeting options
design the settings and provide statistics The interviewees indicate that they receive
automated suggestions through the online interfaces for entering target groups All
the major social media providers (Facebook Google Twitter) offer this type of advice For
instance when an advertiser selects a keyword for targeting in Twitter the online interface will
suggest related keywords The possibilities are also extensive allowing to select specific target
groups A critique however is that the advertisers cannot verify whether the right profiles are
selected for a certain target group and if the right individuals have been reached In this regard
they have to trust the platform owners
Three types of information are used for targeting profile information (the demographic
and other data that users provide) interest-related data (based on for instance likes and
group membership) and behavioural data (based on what users do ie their location
browsing behaviour etcetera) Facebook is indicated to be most advanced in terms of the
offered targeting options as this platform has most data on its users The targeting can be
based on liked brands or pages watched picturesvideos activity on webpages outside
Facebook device location etcetera Furthermore YouTube is also mentioned as a well-
developed platform for targeting advertisements In addition certain platforms are
preferred to target broad groups of individuals For example Snapchat is well suited to
reach younger people whereas Instagram is more appropriate for targeting women Several
new targeting methods have been developed recently which will be discussed in more detail
in the following section
5 New functionalities
51 Identified trends
Social media offer many new possibilities in terms of commercial practices Firstly targeting
is a prime area for which new functionalities were identified In general the interviewees note
that targeting is becoming increasingly more sophisticated and efficient Two specific features
of Facebook were often named custom audiences and lookalike audiences The former
implies that companies use their client database (eg a CRM database containing e-mail
addresses or phone numbers) to specifically target the individuals in this database The
latter lookalike audiences is a functionality that allows targeting new users who have
similar characteristics as a specified group of individuals Performance metrics on these
targets could possibly be much more detailed down to the level of the individual but Facebook
does not allow metrics on custom audiences of fewer than 1000 individuals2
2 The Facebook Advertiser Help Center mentions this limitation with regard to metrics (Audience
Insights) on custom audiences httpswwwfacebookcombusinesshelp580994405331939
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 11 EN
Other novel types of targeting that were mentioned include remarketing (advertising based on
a usersrsquo visit of websites outside the OSM platform) and the linking of data from different
platforms An example of database linking includes the use of Facebook data to target users
on Instagram or the linking of Facebook and WhatsApp data
Additionally new functionalities in terms of formats were discussed The B2B clients and
intermediaries identified an increase in integration of content and advertising For
example commercial messages are more often being shown inside content space and
advertisement labelling has sometimes become less conspicuous Formats also
increasingly focus on keeping users on the social media platform instead of redirecting
them to other websites An example is the canvas advertisement on Facebook which is
essentially a small web page that users can navigate while staying on the Facebook platform
Furthermore video content is seen as an increasingly important format A global intermediary
confirms that videos are better received by consumers and yield better results compared to
traditional advertisements Finally important new indirect ways of advertising were identified
such as promoting brands through social influencers or having lsquonormalrsquo users promote
brands (eg by offering sponsored lenses (or lsquoframesrsquo) which individuals can apply to their
Snapchat pictures)
New functionalities were also observed with regard to metrics and statistics Firstly
advertisers can increasingly link their online advertisements to purchases A local
intermediary explains that when an item is promoted on multiple OSM platforms the
advertiser can determine from which platform the buyer arrived at the sellerrsquos website Second
new software can generate statistics that go beyond the overviews offered by the social media
platforms This software is provided to advertisers and intermediaries and collects the data
through the APIs of the social media platforms (eg Facebook and Twitter) One of the
interviewed intermediaries creates software that enables advertisers to assess which ads work
best with what audiences Another type of technology referred to by a global intermediary
measures what types of emotions are expressed through comments on commercial messages
Overall the advanced analysis by intermediaries of large amounts of raw data provided by
social media platforms is considered as an important new functionality
52 Potential problems and benefits for consumers
With the extensive options in terms of targeting and data usage privacy was often discussed
as a main concern More specifically critique was expressed on the use of client databases for
targeting on social media A local intermediary remarks that not all individuals in a company
database may have opted-in for targeting through social media Consumers may not be fully
aware that contact information collected ldquoofflinerdquo may be used for commercial
practices on social media As an academic notes this can be potentially worrisome
ldquoWhen I gave my phone number e-mail address or physical address I wouldnrsquot expect
those businesses to be able to track me on Facebook and target me with ads but now
they can That is a troubling new functionalityrdquo
Furthermore the practice of remarketing can be perceived as problematic in some cases A
local intermediary argues that retargeting may not be desirable for all products and users may
not wish their purchases (or purchase intentions) to be displayed on-screen Finally in addition
to being perceived as lsquospookyrsquo or lsquoscaryrsquo sophisticated targeting can be problematic when
different individuals are shown different offers (price discrimination) or when certain individuals
are excluded from offers With regard to the latter a consumer organisation identified a
particular risk in insurance companies that chose to advertise only to low-risk individuals (for
instance by targeting users based on their educational level) In terms of formats
commercial messages that look like regular content have the potential to mislead
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2018 EUR 12 EN
consumers Two advertisers organisations name this practice as particularly
problematic In their view consumers should not be misled by an ad that looks like editorial
content As one organisation adds it is especially problematic when such an advertisement
reaches young people who may not possess the background knowledge to discern ads from
editorial content Moreover it is problematic when advertisements are integrated into the social
interaction among users It can be perceived as highly intrusive to see an advertisement
between the Snapchat stories of friends or among private messages on Facebook In addition
to the aforementioned downsides certain benefits of more advanced targeting and data usage
were put forward by a broad range of interviewed actors The displayed advertisements are
more interesting and relevant for the social media users Because the content is more relevant
individuals will be less inclined to feel bothered by hem and instead appreciate the commercial
practices For the same reason the targeted messages may add value for consumers rather
than cause annoyance As a global intermediary summarises
ldquoIn a world where we get so many messages its [about] being relevant [in] what you
say being relevant about the type of product for a certain type of peoplerdquo
6 Misleading practices and remedies
61 Types of misleading practices
The interviewed representatives of B2B clients and Intermediaries indicate that they witnessed
only few instances of clearly misleading practices on the large social media They argue that
social media aim to avoid such misleading advertisements as they do not wish to upset users
Since advertising is a crucial element in their business model social media are very careful
about which advertising they show When prompted however the interviewed B2B clients and
Intermediaries were able to provide examples of misleading problematic and unfair commercial
practices Additional information is provided by consumer organisations and academics who
played particular attention to user data collected by social media They also referred to cases
of malware phishing and misleading promotions The types of misleading commercial practices
that are reported can be classified under the following five categories
Disguised marketing
First an often-mentioned problem is the difficulty to recognise advertising on social media
In part the difficulty to identify ads is related to their format For example on Facebook the
difference between sponsored content and user content is very subtle On Twitter as well it is
difficult to know if content is paid for when browsing hashtags A B2B client suggests that social
media purposefully integrate advertising and content
ldquoOn Facebook it is signalled when content is sponsored but it is not very
obvious and this is on purpose because Facebook does not want to show so
clearly that it is an ad
Furthermore commercial practices are sometimes difficult to recognise because the
commercial nature is not disclosed For example the presence of product placement may not
always be clearly labelled or indicated A specific case in this regard are social influencers
Celebrities or individuals who are popular on social media may be paid by brands to mention
or promote their products When they do not disclose being paid this can be misleading
towards consumers The latter problem is mentioned by several intermediaries and an
advertising self-regulatory body The advertisersrsquo organisation indicates that social influencers
are posting sponsored messages on social media but that they are not necessarily following
EUROPEAN COMMISSION
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2018 EUR 13 EN
the rules set out by self-regulatory bodies (ICC) and by the European Commission (UCPD) It
is argued that such failures may be due to inexperience and lack of familiarity with the existing
rules rather than a conscious intent not to adhere to them
Misleading marketing content
A second type of problematic commercial practice concerns misleading or incorrect product
or price descriptions This includes advertising with misleading information about the price
of a product (eg claiming something is free when it is not) the qualities of the product or
incorrectly claiming that an offer is limited in time This type of misinformation also includes
social media campaigns that are referring to a promotion which is no longer valid
Intermediaries and B2B clients further mentioned that product endorsements by social media
users may not always be fully genuine as they could be part of a lsquoshare and winrsquo or lsquolike and
winrsquo action
Undesirable or improper user targeting
Undesirable or improper user targeting is a third important problematic commercial practice
Several B2B clients and intermediaries mention that many users are unaware of how they are
being tracked and how this affects the advertisements that they see The fact that advertising
is personalised and targeted at specific groups without the users being fully knowledgeable
about it is perceived as problematic by an interviewed academic For example many social
media users may not be aware of any behavioural tracking that occurs (eg platforms tracking
the usersrsquo activities on their website and on many other websites that users visit) It implies
that users may not have been sufficiently informed to give consent to this type of tracking
Furthermore brands can advertise to users who have never lsquolikedrsquo the brandrsquos page or have
no interest in the brand at all (for instance by inserting advertisements on their Facebook News
Feed) A B2B client explains that this practice can make users angry based on individual
comments on the companyrsquos Facebook posts and private messages received through Facebook
Targeting can also fail when it is based on inaccurate information or wrong assumptions Users
may for instance be targeted with products they have already bought
Processing of private data
Fourthly participants in the stakeholder survey indicate that it is problematic when very
private data is not processed transparently Social media collect many different types of
information about their users including profile data activities on the platform real-world
location et cetera How these data are used however is not entirely clear to users The B2B
clients and consumer organisations expressed concern about what data is stored how safe it
is stored and whom it is shared with A consumer organisation mentioned that online social
media do not limit the storage of data in time ie it is stored indefinitely The same
organisation also points out a problematic example of a mobile phone banking app which sends
information to Facebook without notifying its users With WhatsApp being part of Facebook a
local intermediary finds it increasingly unclear which information shared with others is still
private and which can also be used for commercial purposes
Aggressive or criminal practices
A final type of problematic commercial practices concern cases of aggressive or criminal
practices Although the stakeholders indicated that criminal practices are not widespread on
social media they did refer to scams phishing and other illegal activities One particular
example provided by a global intermediary concerns a fake airline profile on social media
which promised that a user can win euro3000 by sharing a message These profile pages receive
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 14 EN
a high amount of visitors and can afterwards be sold on the black market Other cases
mentioned in two B2B interviews are about lsquoaggressiversquo advertisements and aggressive phone
calls after entering contact details on social media
62 Remedies
Various remedies are suggested to counter the aforementioned misleading unfair or
problematic practices The stakeholders interviewed see a role for advertisers social media
users platform owners and governments Intermediaries and B2B clients recognise their role
as advertisers to engage in fair commercial practices that are relevant for consumers In
addition these actors also point out the responsibilities of social media users The latter have
the ability to shape their online advertising environment by indicating which advertisements
they like or do not like As a global intermediary summarises it
ldquoId rather see something that I like or might like instead of tampon commercials So
you yourself [as a user] can make that ad environment just better and more personal
So why wouldnrsquot yourdquo
Furthermore users can report the ads that they find problematic through the automated
reporting on social media The interviewed intermediaries and B2B clients strongly encourage
this
Nevertheless social media providers also have a role in this process Certain B2B clients
and intermediary stakeholders indicate that it is unclear how complaints and reports are
handled Social media providers could be more lsquohands-onrsquo in dealing with user complaints and
when approving advertising Even though the platform owners do not have the capacity to
manually check every advertisement the interviewed advertisers stress the importance of
having a human being (in addition to a computer system) estimate which practices are
acceptable and which are not Furthermore a self-regulatory advertising body proposes that
social media immediately take down advertisements when the self-regulatory body has decided
that they are not acceptable
From the interviews with the different types of stakeholders three key steps to be taken by
social media providers emerged (1) simplify their terms and conditions as well as privacy
policy and present these terms to users in a clear and understandable way (2) label advertising
more prominently and ensure that the same wordingformatting is used throughout the entire
platform and (3) offer more options as opt-in features rather than opt-out With regard to the
first aspect a consumer organisation argues that If the terms of services are not available
and not understandable then its impossible to get an actual consent from the consumer
Finally certain participants in the survey identified a role for governments An intermediary
and consumer organisation suggest that governments (eg on a European level) should
monitor commercial practices performed on online social media and track new technologies
that could potentially violate consumer rights In terms of the current commercial practices on
social media the interviewees from different stakeholder categories identified the need for
laws on privacy and data protection to be adapted to the current practices on social
media Finally legislation is requested to ensure that social influencers are required to
disclose when they are being paid for certain messages With regard to the latter a global
intermediary adds the following
ldquoJust like we have to do on TV and say there is product placement in the TV
show you should be obliged to do it on your social mediardquo
7 Issues and complaints
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2018 EUR 15 EN
71 Consumers
Consumers have different means of complaining about problematic commercial practices on
social media The most common channel to voice complaints is through the social media
platforms themselves On Facebook users may for instance click negative emoticons post
comments or report the advertisement Less commonly private messages can also be sent
to advertisers Depending on the situation either social media providers deal with a complaint
(eg for complaints expressed through the reporting tool) or the advertiser handles it (eg
for complaints communicated through comments or private messages) Consumers almost
never address their complaints to intermediaries because for social media users it is not visible
which intermediaries are behind a campaign Intermediaries may deal with user complaints in
the name of their end clients or they may forward the complaints to their clients Certain
intermediaries are not at all involved in dealing with user complaints for example
intermediaries which offer software for metrics Some actors use a very structured approach
in answering user feedback One of the interviewed B2B clients makes use of a flow chart to
identify which actions to take in case of user positive neutral or negative consumer response
on social media
The interviewed B2B clients intermediaries and consumer organisations primarily identified
user complains concerning the high number of advertisements (lsquospammingrsquo or lsquopolluting their
contentrsquo) the targeting of commercial practices (mistargeting showing irrelevant ads or re-
targeting advertisement) and the difficulty to identify advertising and discern it from other
content With regard to the latter an advertising self-regulating body reports an
increase in the complaints about social influencers who do not clearly identify which
of their activities are sponsored
72 B2B clients
The issues and complaints that advertisers have are related to the social media platforms
Nevertheless the number of complaints is very limited When issues do arise they are
sometimes related to the platform disapproving an advertiserrsquos campaign without a clear
reason the complexity of the options when advertising on social media and the difficulty of
working with the platformrsquos API (Application Programming Interface)
8 Actions by enforcement authorities
Involvement of enforcement authorities was not a common action when dealing with
problematic commercial practices An important explanation for this is that ndash as multiple
stakeholders indicated ndash going to court takes time It is far more likely that a consumer
complaint is resolved by the advertising company or that a self-regulatory body is involved
The German advertising self-regulator pointed out that their process is much faster than a
court procedure However when the regulator lacks resources or when the complaint deals
with criminal activities the issue is taken to the enforcement authorities
When enforcement authorities are involved it usually concerns the most serious complaints
Examples mentioned by the interviewees include cases about criminal activities (Germany)
alcohol advertising (Poland) data collection (Italy) and out-of-stock products (Belgium) In
many of the cases mentioned in the interviews the government was involved by filing a
complaint against certain commercial practices
Whereas investigations against social influencers are not common in Europe the United States
enforce a more extensive legislation on this topic A respondent from a global intermediary was
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2018 EUR 16 EN
aware of a case in the United States where the legal authorities had fined YouTube influencers
for not disclosing sponsorship
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 17 EN
9 Conclusions
The stakeholder survey is part of subtask 14 which aimed to investigate marketing practices
on online social media from a traderrsquos point of view The survey consisted of 50 in-depth
interviews of stakeholders belonging to relevant subgroups with different perspectives and
explored the roles and responsibilities of OSM providers and other actors in the commercial
practices on their platforms More specifically the stakeholder survey aimed to acquire
information about which commercial practices can be found on social media and in what way
certain practices may be misleading unfair or problematic for consumers Additionally the
views of the different stakeholders were assessed and compared as well as their role in the
commercial practices
Types of commercial practices on social media
The stakeholders interviewed differentiate two broad types of activities
- Posting lsquoorganicallyrsquo publishing interesting content without paying for it
- Performing lsquomarketingrsquo engaging in payed-for commercial practices
Additional practices emerged during the interviews including paying social influencers for
promoting products or services managing the social media pages or communities of brands
and analysing what is being said about brands on social media These services can be offered
by local or global intermediaries or by individual social influencers
91 Novel commercial practices on social media
Throughout the stakeholder interviews different functionalities and targeting methods on social
media were discussed The four largest OSM platforms covered in the majority of the
interviews offer extensive possibilities for engaging in commercial practices To compete with
other platforms the major social media are also continuously creating new possibilities for
advertisers and traders which they promote through sales persons and tutorials
Among these new functionalities are extensive options for targeting advertisements The main
OSM platforms allow targeting based on information contained in the registered user profile
interest-related data and behavioural data A relatively new feature of targeting is the use of
custom audiences by targeting clients in the companyrsquos database on OSM platforms by
matching contact information Another example is the creation of lookalike audiences which
allows the targeting of new users who have similar characteristics as a specified group of
individuals Additionally it is also possible to target users who have visited a particular website
outside of the OSM platform Hence targeting through OSM platforms can be based on very
specific individual properties and behaviour
Because the targeting options are extensive advertisers sometimes chose to cooperate with
intermediaries Traders value intermediaries because of their expertise in both marketing
strategies and platform functionalities Intermediaries are therefore primarily used when
setting up a campaign that is complex in terms of targeting format or content Furthermore
intermediaries may also handle the creation of content and communication through OSM on
behalf of the client Finally certain intermediaries offer software facilitating social media
advertising and evaluating campaign effectiveness These additional features are made
possible because the intermediaries make use of the platformsrsquo API (application programming
interface) to provide data These additional statistics tap into the need for better metrics The
interviewed advertisers indicated that the statistics provided by the social media platforms are
not always adequate Even though the data are detailed the B2B clients and intermediaries
EUROPEAN COMMISSION
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indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
EUROPEAN COMMISSION
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In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
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2018 EUR 20 EN
10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
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Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
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102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
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2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
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Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
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Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
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via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
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(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 4 EN
LEGAL NOTICE
This report was produced under the EU Consumer Programme (2014-2020) in the frame of a specific contract with
the Consumers Health Agriculture and Food Executive Agency (Chafea) acting on behalf of the European
Commission
The content of this report represents the views of GfK Belgium and is its sole responsibility it can in no way be taken
to reflect the views of the European Commission andor Chafea or any other body of the European Union
The European Commission andor Chafea do not guarantee the accuracy of the data included in this report nor do
they accept responsibility for any use made by third parties thereof
Project number 20183823
Title Stakeholder survey
Language version FormatVolume Catalogue number ISBN DOI
EN PDF PDFVolume_01 EB-01-18-688-EN-N 978-92-9200-939-7 102818693859
copy European Union 2018
Reproduction is authorised provided the source is acknowledged
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 5 EN
Table of Contents
1 Introduction 6
2 Methodology 6
3 Types of commercial practices and role of industry stakeholders 6
31 Commercial practices 6
32 The role of Intermediaries and B2B clients 7
4 The role of OSM providers 8
41 Approval of content 8
42 Format and functionalities 9
43 Targeting 10
5 New functionalities 10
51 Identified trends 10
52 Potential problems and benefits for consumers 11
6 Misleading practices and remedies 12
61 Types of misleading practices 12
62 Remedies 14
7 Issues and complaints 14
71 Consumers 15
72 B2B clients 15
8 Actions by enforcement authorities 15
9 Conclusions 17
91 Novel commercial practices on social media 17
92 Potentially misleading practices identified by stakeholders 18
93 The role of OSM providers in the approval process formats and functionalities 18
94 Remedies proposed by industry stakeholders 19
10 Appendix 20
101Appendix 1 List of stakeholders interviewed 20
102Appendix 2 Stakeholder survey ndash interview guide 22
103Appendix 3 Briefing on misleading commercial practices 26
104Appendix 4 Analysis ndash Empty grid used for analysis 28
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 6 EN
1 Introduction
The following section describes the results of the stakeholder survey with six types of relevant
stakeholders B2B clients (14) local intermediaries (13) global intermediaries (11) consumer
organisations (3) advertisers organisations (8) and academics (4) OSM providers were also
contacted for participation in the survey although only a single OSM provider participated in
the research This interview was discarded as the response from a single respondent did not
allow a separate analysis of the OSM providersrsquo views on the topic
B2B clients are organisations that engage in commercial practices directly through social media
They have a business-to-business relationship with the online social media providers In
contrast the end client can also appeal to intermediaries which act as a third party facilitating
commercial practices through social media In this case the end client does not engage directly
with the social media providers The stakeholders listed in Appendix 1 were interviewed about
their perspective on commercial practices through online social media These views are
summarised below with regard to the following key research topics
- The main topics of the interview concerned
- Commercial practices on OSM
- Novel functionalities and trends
- Potential concerns and benefits for consumers
- Misleading unfair and problematic commercial practices on OSM
- Potential remedies
- The roles of the stakeholders in the approval format and functionalities of marketing
content in OSM
- User issues and complaints
2 Methodology
Stakeholders were approached through GfK contacts in the sector contacts found through desk
research and interactions with consumer and advertiser associations The actors contacted
were invited for an open-ended telephone interview In total 53 interviews were conducted by
researchers dedicated to the project All interviews were recorded for further analysis
An interview guide was used to structure the 30- to 40-minute conversations containing open-
ended questions on the key topics At the start of the interview the respondents received
information on the context of the study Furthermore consent was obtained to report their
company name and to record the interview for analysis After the fieldwork the recordings
were summarised in a specific grid created for data analysis which was based on the key
research dimensions This grid included in Appendix 4 guided the analysis of the interviews
and the subsequent report-writing phase
3 Types of commercial practices and role of industry stakeholders
31 Commercial practices
Companies and organisations can engage in various types of commercial practices through
online social media The stakeholders interviewed differentiate two broad types of activities
posting lsquoorganicallyrsquo and engaging in lsquomarketingrsquo The former encompasses publishing
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 7 EN
interesting content without paying for it (eg posting stories or news on a companyrsquos own
social media page) the latter includes all types of payed-for commercial practices ndashsee below
Within marketing the type of practices used depends on the stage of the marketing process
The stakeholders first identify the lsquoawarenessrsquo stage (also called branding) in which the aim is
to reach a broad audience and provide them with an impression of a productservice Posting
pictures or video is suited in this phase as well as publishing an advertorial (ie a sponsored
article to be posted on social media) Intermediaries or B2B clients may for instance invest in
Facebook banner ads Sponsored Instagram ads Promoted pins on Pinterest or a skippable
lsquoprerollrsquo video on YouTube The focus in this phase is on reaching a certain number of users in
a certain amount of time and it can be linked to any type of engagement with an offer clicking
on it studying it liking it etcetera
A second phase in advertising concerns the conversion phase (also called performance) The
goal in this phase is to promote a specific productservice and to sell it More precise targeting
is therefore essential in this phase It can be accomplished by targeting on demographics or
interests remarketing (taking into account which productsservices the user researched
outside the OSM platform) targeting based on a list of users (from a company database from
individuals who subscribed to receive updates etcetera) For the actual purchase of the
productservice social media provide the opportunity of linking to a product page or facilitating
shopping through the social media platform (eg advertisers can add a shop section to a
brandrsquos Facebook page)1
In addition to those listed under the aforementioned phases of advertising certain other
commercial practices were discussed in the stakeholder interviews These practices include
paying social influencers for promoting productsservices managing (as an intermediary)
the social media pages and communities of brands and analysing what users are saying
about brands on social media These services are not offered by the OSM providers but by
third parties such as individual social influencers or intermediaries
32 The role of Intermediaries and B2B clients
For organisations that wish to engage in commercial practices on social media the possibilities
and options are plentiful To make the right decisions in terms of targeting content and general
strategy these organisations can turn to intermediaries A B2B client explains that it depends
on the budget and complexity of a campaign whether they set it up on their own or involve an
advertising company If the budget is high and the project is complex ndash in terms of targeting
format content or otherwise ndash an intermediary is more likely to become involved
This indicates the first role of intermediaries which is to provide advice to organisations that
aim to advertise through social media The intermediaries have expertise in both the functions
of social media platforms as well as in marketing strategies Offering this combined expertise
is an added value for their clients For this reason an interviewed B2B client values the
involvement of intermediaries
ldquoThe thing [intermediaries] got ndash and theyrsquore really so important for that ndash they got all
the knowledge about all the Facebook products about what works fine and what
doesnrsquot work fine They give us quite a bit of advice on what we should push on
1 On Facebook advertisers can set up a shop section and include a ldquoMessage to Buyrdquo button allowing consumers to indicate products they are interested in purchasing For the payment of the order users will be redirected to the merchantrsquos website as the option of payment through the Facebook platform is not (yet) available in the EU httpswwwfacebookcombusinesshelp912190892201033
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2018 EUR 8 EN
Facebook Twitter and YouTube as well So theyrsquove got all the knowledge and quite a
lot of experience with itrdquo
Second local and global intermediaries can have an important role in reaching the right target
groups and optimising the strategy for targeting audiences As the targeting options on social
media are extensive advertisers sometimes hire an intermediary to set up a campaign For
instance one of the interviewed B2B clients hired a marketing agency (as intermediary) to set
up the targeting of specific groups The intermediary in this case helped the client to take the
first steps in advertising through social media
Furthermore a subgroup of intermediaries offers software that facilitates advertising through
online social media or assessing the effectiveness of campaigns For example one of the
intermediaries has created software that assists in buying advertising space on Facebook
creating campaigns setting up target audiences etcetera Their software package can be
considered an efficiency tool which saves time for the end clients and allows them to advertise
on Facebook at a greater scale Other intermediaries create software for acquiring more
detailed metrics on campaigns and advanced statistics on the outcomes For instance an
intermediary offers a tool that shows the performance of an advertisement across multiple
platforms One of the interviewed academic furthermore refers to a software called Ditto that
analyses social media images for visual cues on brands and emotions These examples have in
common that they take advantage of the data available through social media and construct
more advanced metrics than those offered on the OSM platform
Finally intermediaries can take up the creation of content (visuals and texts) for social media
campaigns or they may handle all communication through social media of behalf of their client
(ie social media management) With regard to the control of contents and formats the
intermediaries indicate that their end client has the final word in approving the approach
Nevertheless a local intermediary remarked that their company would not assist costumers
that aim to place misleading ads or performs aggressive targeting
The aforementioned examples show that clients may cooperate with intermediaries in a variety
of cases In other instances however organisations choose to set up their campaigns
themselves For the majority of the interviewed B2B clients his implies using the platform tools
without any personal assistance Only B2B clients that have a large budget to spend on social
media advertising (or that represent highly popular brands) can rely on a direct contact person
(account manager) in the major social media As a B2B client phrases this
Were trying to reach out to [Facebook] to have a personalised relationship so that
we can ask stuff But thats only for top-tier clients that have like five million likes or
something They have an account manage but for us we dont have one yet
At least five B2B clients among the interviewed representatives do have account managers
For these companies the account managers offer a more accessible means of communication
with the OSM providers The companies tend to correspond with them mainly at the start of a
campaign or when a campaign is more complex
4 The role of OSM providers
41 Approval of content
Stakeholders indicate that social media providers have rules about what is accepted and not
accepted in an advertisement Facebook and Twitter for instance explicitly promote these
rules to advertisers For Facebook their policy concerns violence sexuality alcohol and drugs
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2018 EUR 9 EN
Moreover it also forbids lsquoclickbaitrsquo and images that contain over 20 percent of text Google
(YouTube) is quite strict in terms of regulating nudity in videos and LinkedIn also performs
automated checks on advertisements (eg the platforms restricts the use of capitalised
words) Overall the stakeholders have the impression that the rules on advertising in online
social media are quite strict A local intermediary adds that the rules have become more
restrictive over time in the beginning almost everything could have been posted online
whereas now it is more limited the intermediary reports
In practice when submitting an advertisement on Facebook it is checked through an
automated process Within 10 minutes the advertiser is notified whether the ad was
approved or rejected In case the advertiser disagrees with a rejection he or she can send
feedback after which someone will check the concerned advertisement Despite this automated
check the intermediaries and B2B clients indicate that Facebook cannot possibly check every
aspect of an ad as the volume is very high There is however a second mechanism through
which users can report problematic advertisements after they are published Ads on Facebook
feature reporting buttons and other means for all users to provide feedback A B2B client
explains that Facebook bases the price of a campaign on how successful it is (ie the number
of times it is liked by users) and to what extent it receives negative user reports If
advertisements are unsuccessful or frequently reported by users Facebook will increase the
price for the advertiser or ask the advertiser to make changes to the advertisement (in terms
of content pictures or wording) to increase its attractiveness It is furthermore reported that
negative user feedback can lead to the shutdown of campaigns
42 Format and functionalities
In terms of formats and functionalities social media are constantly innovating and
creating new marketing possibilities These new options are promoted towards
advertisers for instance by providing online trainings about the new features informing
advertisers through sales people or offering price incentives Through these methods for
instance Facebook has promoted video as an advertising format in order to compete with other
platforms most notably YouTube
The social media providers are balancing their need to offer new options and the trust of their
platform users For this purpose there are certain limitations to the formats For instance
when content is sponsored Facebook adds a label to the ad Users can also typically report an
advertisement when they think the format or contents are inappropriate (see also ldquoApproval of
contentrdquo)
In terms of functionality social media providers offer information about which users are
targeted These data are always anonymous as a global intermediary indicates
ldquoWe only get information about masses of people The only reason why we get this
kind of information is to make our message more relevant for peoplerdquo
Even though the provided metrics are very detailed (indicating language age
location ethnicity interests etcetera) they are only visible for segments of 1000 to
2000 users From the perspective of intermediaries and B2B clients this renders the metrics
somewhat unsatisfying A B2B client notes that if metrics were more granular it would be
easier to target the right users making them more satisfied An academic concurs that the
metrics are relatively high-level and suggests that OSM providers could give more information
about the number of individuals actually targeted compared to the desired target size On the
YouTube metrics a local intermediary remarks that they are poorly organised and highlight
mainly the number of ldquoclicksrdquo whereas not all clicks will bring the user to the advertisers
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website As an experienced user in advertising the intermediary adds one can create custom
reports and custom setting on YouTube resulting in metrics that are more useful
43 Targeting
The intermediaries and B2B clients indicate that the OSM providers have an important role in
providing targeting possibilities They offer the underlying data deliver the targeting options
design the settings and provide statistics The interviewees indicate that they receive
automated suggestions through the online interfaces for entering target groups All
the major social media providers (Facebook Google Twitter) offer this type of advice For
instance when an advertiser selects a keyword for targeting in Twitter the online interface will
suggest related keywords The possibilities are also extensive allowing to select specific target
groups A critique however is that the advertisers cannot verify whether the right profiles are
selected for a certain target group and if the right individuals have been reached In this regard
they have to trust the platform owners
Three types of information are used for targeting profile information (the demographic
and other data that users provide) interest-related data (based on for instance likes and
group membership) and behavioural data (based on what users do ie their location
browsing behaviour etcetera) Facebook is indicated to be most advanced in terms of the
offered targeting options as this platform has most data on its users The targeting can be
based on liked brands or pages watched picturesvideos activity on webpages outside
Facebook device location etcetera Furthermore YouTube is also mentioned as a well-
developed platform for targeting advertisements In addition certain platforms are
preferred to target broad groups of individuals For example Snapchat is well suited to
reach younger people whereas Instagram is more appropriate for targeting women Several
new targeting methods have been developed recently which will be discussed in more detail
in the following section
5 New functionalities
51 Identified trends
Social media offer many new possibilities in terms of commercial practices Firstly targeting
is a prime area for which new functionalities were identified In general the interviewees note
that targeting is becoming increasingly more sophisticated and efficient Two specific features
of Facebook were often named custom audiences and lookalike audiences The former
implies that companies use their client database (eg a CRM database containing e-mail
addresses or phone numbers) to specifically target the individuals in this database The
latter lookalike audiences is a functionality that allows targeting new users who have
similar characteristics as a specified group of individuals Performance metrics on these
targets could possibly be much more detailed down to the level of the individual but Facebook
does not allow metrics on custom audiences of fewer than 1000 individuals2
2 The Facebook Advertiser Help Center mentions this limitation with regard to metrics (Audience
Insights) on custom audiences httpswwwfacebookcombusinesshelp580994405331939
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Other novel types of targeting that were mentioned include remarketing (advertising based on
a usersrsquo visit of websites outside the OSM platform) and the linking of data from different
platforms An example of database linking includes the use of Facebook data to target users
on Instagram or the linking of Facebook and WhatsApp data
Additionally new functionalities in terms of formats were discussed The B2B clients and
intermediaries identified an increase in integration of content and advertising For
example commercial messages are more often being shown inside content space and
advertisement labelling has sometimes become less conspicuous Formats also
increasingly focus on keeping users on the social media platform instead of redirecting
them to other websites An example is the canvas advertisement on Facebook which is
essentially a small web page that users can navigate while staying on the Facebook platform
Furthermore video content is seen as an increasingly important format A global intermediary
confirms that videos are better received by consumers and yield better results compared to
traditional advertisements Finally important new indirect ways of advertising were identified
such as promoting brands through social influencers or having lsquonormalrsquo users promote
brands (eg by offering sponsored lenses (or lsquoframesrsquo) which individuals can apply to their
Snapchat pictures)
New functionalities were also observed with regard to metrics and statistics Firstly
advertisers can increasingly link their online advertisements to purchases A local
intermediary explains that when an item is promoted on multiple OSM platforms the
advertiser can determine from which platform the buyer arrived at the sellerrsquos website Second
new software can generate statistics that go beyond the overviews offered by the social media
platforms This software is provided to advertisers and intermediaries and collects the data
through the APIs of the social media platforms (eg Facebook and Twitter) One of the
interviewed intermediaries creates software that enables advertisers to assess which ads work
best with what audiences Another type of technology referred to by a global intermediary
measures what types of emotions are expressed through comments on commercial messages
Overall the advanced analysis by intermediaries of large amounts of raw data provided by
social media platforms is considered as an important new functionality
52 Potential problems and benefits for consumers
With the extensive options in terms of targeting and data usage privacy was often discussed
as a main concern More specifically critique was expressed on the use of client databases for
targeting on social media A local intermediary remarks that not all individuals in a company
database may have opted-in for targeting through social media Consumers may not be fully
aware that contact information collected ldquoofflinerdquo may be used for commercial
practices on social media As an academic notes this can be potentially worrisome
ldquoWhen I gave my phone number e-mail address or physical address I wouldnrsquot expect
those businesses to be able to track me on Facebook and target me with ads but now
they can That is a troubling new functionalityrdquo
Furthermore the practice of remarketing can be perceived as problematic in some cases A
local intermediary argues that retargeting may not be desirable for all products and users may
not wish their purchases (or purchase intentions) to be displayed on-screen Finally in addition
to being perceived as lsquospookyrsquo or lsquoscaryrsquo sophisticated targeting can be problematic when
different individuals are shown different offers (price discrimination) or when certain individuals
are excluded from offers With regard to the latter a consumer organisation identified a
particular risk in insurance companies that chose to advertise only to low-risk individuals (for
instance by targeting users based on their educational level) In terms of formats
commercial messages that look like regular content have the potential to mislead
EUROPEAN COMMISSION
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2018 EUR 12 EN
consumers Two advertisers organisations name this practice as particularly
problematic In their view consumers should not be misled by an ad that looks like editorial
content As one organisation adds it is especially problematic when such an advertisement
reaches young people who may not possess the background knowledge to discern ads from
editorial content Moreover it is problematic when advertisements are integrated into the social
interaction among users It can be perceived as highly intrusive to see an advertisement
between the Snapchat stories of friends or among private messages on Facebook In addition
to the aforementioned downsides certain benefits of more advanced targeting and data usage
were put forward by a broad range of interviewed actors The displayed advertisements are
more interesting and relevant for the social media users Because the content is more relevant
individuals will be less inclined to feel bothered by hem and instead appreciate the commercial
practices For the same reason the targeted messages may add value for consumers rather
than cause annoyance As a global intermediary summarises
ldquoIn a world where we get so many messages its [about] being relevant [in] what you
say being relevant about the type of product for a certain type of peoplerdquo
6 Misleading practices and remedies
61 Types of misleading practices
The interviewed representatives of B2B clients and Intermediaries indicate that they witnessed
only few instances of clearly misleading practices on the large social media They argue that
social media aim to avoid such misleading advertisements as they do not wish to upset users
Since advertising is a crucial element in their business model social media are very careful
about which advertising they show When prompted however the interviewed B2B clients and
Intermediaries were able to provide examples of misleading problematic and unfair commercial
practices Additional information is provided by consumer organisations and academics who
played particular attention to user data collected by social media They also referred to cases
of malware phishing and misleading promotions The types of misleading commercial practices
that are reported can be classified under the following five categories
Disguised marketing
First an often-mentioned problem is the difficulty to recognise advertising on social media
In part the difficulty to identify ads is related to their format For example on Facebook the
difference between sponsored content and user content is very subtle On Twitter as well it is
difficult to know if content is paid for when browsing hashtags A B2B client suggests that social
media purposefully integrate advertising and content
ldquoOn Facebook it is signalled when content is sponsored but it is not very
obvious and this is on purpose because Facebook does not want to show so
clearly that it is an ad
Furthermore commercial practices are sometimes difficult to recognise because the
commercial nature is not disclosed For example the presence of product placement may not
always be clearly labelled or indicated A specific case in this regard are social influencers
Celebrities or individuals who are popular on social media may be paid by brands to mention
or promote their products When they do not disclose being paid this can be misleading
towards consumers The latter problem is mentioned by several intermediaries and an
advertising self-regulatory body The advertisersrsquo organisation indicates that social influencers
are posting sponsored messages on social media but that they are not necessarily following
EUROPEAN COMMISSION
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the rules set out by self-regulatory bodies (ICC) and by the European Commission (UCPD) It
is argued that such failures may be due to inexperience and lack of familiarity with the existing
rules rather than a conscious intent not to adhere to them
Misleading marketing content
A second type of problematic commercial practice concerns misleading or incorrect product
or price descriptions This includes advertising with misleading information about the price
of a product (eg claiming something is free when it is not) the qualities of the product or
incorrectly claiming that an offer is limited in time This type of misinformation also includes
social media campaigns that are referring to a promotion which is no longer valid
Intermediaries and B2B clients further mentioned that product endorsements by social media
users may not always be fully genuine as they could be part of a lsquoshare and winrsquo or lsquolike and
winrsquo action
Undesirable or improper user targeting
Undesirable or improper user targeting is a third important problematic commercial practice
Several B2B clients and intermediaries mention that many users are unaware of how they are
being tracked and how this affects the advertisements that they see The fact that advertising
is personalised and targeted at specific groups without the users being fully knowledgeable
about it is perceived as problematic by an interviewed academic For example many social
media users may not be aware of any behavioural tracking that occurs (eg platforms tracking
the usersrsquo activities on their website and on many other websites that users visit) It implies
that users may not have been sufficiently informed to give consent to this type of tracking
Furthermore brands can advertise to users who have never lsquolikedrsquo the brandrsquos page or have
no interest in the brand at all (for instance by inserting advertisements on their Facebook News
Feed) A B2B client explains that this practice can make users angry based on individual
comments on the companyrsquos Facebook posts and private messages received through Facebook
Targeting can also fail when it is based on inaccurate information or wrong assumptions Users
may for instance be targeted with products they have already bought
Processing of private data
Fourthly participants in the stakeholder survey indicate that it is problematic when very
private data is not processed transparently Social media collect many different types of
information about their users including profile data activities on the platform real-world
location et cetera How these data are used however is not entirely clear to users The B2B
clients and consumer organisations expressed concern about what data is stored how safe it
is stored and whom it is shared with A consumer organisation mentioned that online social
media do not limit the storage of data in time ie it is stored indefinitely The same
organisation also points out a problematic example of a mobile phone banking app which sends
information to Facebook without notifying its users With WhatsApp being part of Facebook a
local intermediary finds it increasingly unclear which information shared with others is still
private and which can also be used for commercial purposes
Aggressive or criminal practices
A final type of problematic commercial practices concern cases of aggressive or criminal
practices Although the stakeholders indicated that criminal practices are not widespread on
social media they did refer to scams phishing and other illegal activities One particular
example provided by a global intermediary concerns a fake airline profile on social media
which promised that a user can win euro3000 by sharing a message These profile pages receive
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 14 EN
a high amount of visitors and can afterwards be sold on the black market Other cases
mentioned in two B2B interviews are about lsquoaggressiversquo advertisements and aggressive phone
calls after entering contact details on social media
62 Remedies
Various remedies are suggested to counter the aforementioned misleading unfair or
problematic practices The stakeholders interviewed see a role for advertisers social media
users platform owners and governments Intermediaries and B2B clients recognise their role
as advertisers to engage in fair commercial practices that are relevant for consumers In
addition these actors also point out the responsibilities of social media users The latter have
the ability to shape their online advertising environment by indicating which advertisements
they like or do not like As a global intermediary summarises it
ldquoId rather see something that I like or might like instead of tampon commercials So
you yourself [as a user] can make that ad environment just better and more personal
So why wouldnrsquot yourdquo
Furthermore users can report the ads that they find problematic through the automated
reporting on social media The interviewed intermediaries and B2B clients strongly encourage
this
Nevertheless social media providers also have a role in this process Certain B2B clients
and intermediary stakeholders indicate that it is unclear how complaints and reports are
handled Social media providers could be more lsquohands-onrsquo in dealing with user complaints and
when approving advertising Even though the platform owners do not have the capacity to
manually check every advertisement the interviewed advertisers stress the importance of
having a human being (in addition to a computer system) estimate which practices are
acceptable and which are not Furthermore a self-regulatory advertising body proposes that
social media immediately take down advertisements when the self-regulatory body has decided
that they are not acceptable
From the interviews with the different types of stakeholders three key steps to be taken by
social media providers emerged (1) simplify their terms and conditions as well as privacy
policy and present these terms to users in a clear and understandable way (2) label advertising
more prominently and ensure that the same wordingformatting is used throughout the entire
platform and (3) offer more options as opt-in features rather than opt-out With regard to the
first aspect a consumer organisation argues that If the terms of services are not available
and not understandable then its impossible to get an actual consent from the consumer
Finally certain participants in the survey identified a role for governments An intermediary
and consumer organisation suggest that governments (eg on a European level) should
monitor commercial practices performed on online social media and track new technologies
that could potentially violate consumer rights In terms of the current commercial practices on
social media the interviewees from different stakeholder categories identified the need for
laws on privacy and data protection to be adapted to the current practices on social
media Finally legislation is requested to ensure that social influencers are required to
disclose when they are being paid for certain messages With regard to the latter a global
intermediary adds the following
ldquoJust like we have to do on TV and say there is product placement in the TV
show you should be obliged to do it on your social mediardquo
7 Issues and complaints
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 15 EN
71 Consumers
Consumers have different means of complaining about problematic commercial practices on
social media The most common channel to voice complaints is through the social media
platforms themselves On Facebook users may for instance click negative emoticons post
comments or report the advertisement Less commonly private messages can also be sent
to advertisers Depending on the situation either social media providers deal with a complaint
(eg for complaints expressed through the reporting tool) or the advertiser handles it (eg
for complaints communicated through comments or private messages) Consumers almost
never address their complaints to intermediaries because for social media users it is not visible
which intermediaries are behind a campaign Intermediaries may deal with user complaints in
the name of their end clients or they may forward the complaints to their clients Certain
intermediaries are not at all involved in dealing with user complaints for example
intermediaries which offer software for metrics Some actors use a very structured approach
in answering user feedback One of the interviewed B2B clients makes use of a flow chart to
identify which actions to take in case of user positive neutral or negative consumer response
on social media
The interviewed B2B clients intermediaries and consumer organisations primarily identified
user complains concerning the high number of advertisements (lsquospammingrsquo or lsquopolluting their
contentrsquo) the targeting of commercial practices (mistargeting showing irrelevant ads or re-
targeting advertisement) and the difficulty to identify advertising and discern it from other
content With regard to the latter an advertising self-regulating body reports an
increase in the complaints about social influencers who do not clearly identify which
of their activities are sponsored
72 B2B clients
The issues and complaints that advertisers have are related to the social media platforms
Nevertheless the number of complaints is very limited When issues do arise they are
sometimes related to the platform disapproving an advertiserrsquos campaign without a clear
reason the complexity of the options when advertising on social media and the difficulty of
working with the platformrsquos API (Application Programming Interface)
8 Actions by enforcement authorities
Involvement of enforcement authorities was not a common action when dealing with
problematic commercial practices An important explanation for this is that ndash as multiple
stakeholders indicated ndash going to court takes time It is far more likely that a consumer
complaint is resolved by the advertising company or that a self-regulatory body is involved
The German advertising self-regulator pointed out that their process is much faster than a
court procedure However when the regulator lacks resources or when the complaint deals
with criminal activities the issue is taken to the enforcement authorities
When enforcement authorities are involved it usually concerns the most serious complaints
Examples mentioned by the interviewees include cases about criminal activities (Germany)
alcohol advertising (Poland) data collection (Italy) and out-of-stock products (Belgium) In
many of the cases mentioned in the interviews the government was involved by filing a
complaint against certain commercial practices
Whereas investigations against social influencers are not common in Europe the United States
enforce a more extensive legislation on this topic A respondent from a global intermediary was
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 16 EN
aware of a case in the United States where the legal authorities had fined YouTube influencers
for not disclosing sponsorship
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 17 EN
9 Conclusions
The stakeholder survey is part of subtask 14 which aimed to investigate marketing practices
on online social media from a traderrsquos point of view The survey consisted of 50 in-depth
interviews of stakeholders belonging to relevant subgroups with different perspectives and
explored the roles and responsibilities of OSM providers and other actors in the commercial
practices on their platforms More specifically the stakeholder survey aimed to acquire
information about which commercial practices can be found on social media and in what way
certain practices may be misleading unfair or problematic for consumers Additionally the
views of the different stakeholders were assessed and compared as well as their role in the
commercial practices
Types of commercial practices on social media
The stakeholders interviewed differentiate two broad types of activities
- Posting lsquoorganicallyrsquo publishing interesting content without paying for it
- Performing lsquomarketingrsquo engaging in payed-for commercial practices
Additional practices emerged during the interviews including paying social influencers for
promoting products or services managing the social media pages or communities of brands
and analysing what is being said about brands on social media These services can be offered
by local or global intermediaries or by individual social influencers
91 Novel commercial practices on social media
Throughout the stakeholder interviews different functionalities and targeting methods on social
media were discussed The four largest OSM platforms covered in the majority of the
interviews offer extensive possibilities for engaging in commercial practices To compete with
other platforms the major social media are also continuously creating new possibilities for
advertisers and traders which they promote through sales persons and tutorials
Among these new functionalities are extensive options for targeting advertisements The main
OSM platforms allow targeting based on information contained in the registered user profile
interest-related data and behavioural data A relatively new feature of targeting is the use of
custom audiences by targeting clients in the companyrsquos database on OSM platforms by
matching contact information Another example is the creation of lookalike audiences which
allows the targeting of new users who have similar characteristics as a specified group of
individuals Additionally it is also possible to target users who have visited a particular website
outside of the OSM platform Hence targeting through OSM platforms can be based on very
specific individual properties and behaviour
Because the targeting options are extensive advertisers sometimes chose to cooperate with
intermediaries Traders value intermediaries because of their expertise in both marketing
strategies and platform functionalities Intermediaries are therefore primarily used when
setting up a campaign that is complex in terms of targeting format or content Furthermore
intermediaries may also handle the creation of content and communication through OSM on
behalf of the client Finally certain intermediaries offer software facilitating social media
advertising and evaluating campaign effectiveness These additional features are made
possible because the intermediaries make use of the platformsrsquo API (application programming
interface) to provide data These additional statistics tap into the need for better metrics The
interviewed advertisers indicated that the statistics provided by the social media platforms are
not always adequate Even though the data are detailed the B2B clients and intermediaries
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 18 EN
indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
EUROPEAN COMMISSION
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In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 20 EN
10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
Directorate-General for Consumers
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Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
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102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
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the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
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Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
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2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
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2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
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Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
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Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
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Table of Contents
1 Introduction 6
2 Methodology 6
3 Types of commercial practices and role of industry stakeholders 6
31 Commercial practices 6
32 The role of Intermediaries and B2B clients 7
4 The role of OSM providers 8
41 Approval of content 8
42 Format and functionalities 9
43 Targeting 10
5 New functionalities 10
51 Identified trends 10
52 Potential problems and benefits for consumers 11
6 Misleading practices and remedies 12
61 Types of misleading practices 12
62 Remedies 14
7 Issues and complaints 14
71 Consumers 15
72 B2B clients 15
8 Actions by enforcement authorities 15
9 Conclusions 17
91 Novel commercial practices on social media 17
92 Potentially misleading practices identified by stakeholders 18
93 The role of OSM providers in the approval process formats and functionalities 18
94 Remedies proposed by industry stakeholders 19
10 Appendix 20
101Appendix 1 List of stakeholders interviewed 20
102Appendix 2 Stakeholder survey ndash interview guide 22
103Appendix 3 Briefing on misleading commercial practices 26
104Appendix 4 Analysis ndash Empty grid used for analysis 28
EUROPEAN COMMISSION
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2018 EUR 6 EN
1 Introduction
The following section describes the results of the stakeholder survey with six types of relevant
stakeholders B2B clients (14) local intermediaries (13) global intermediaries (11) consumer
organisations (3) advertisers organisations (8) and academics (4) OSM providers were also
contacted for participation in the survey although only a single OSM provider participated in
the research This interview was discarded as the response from a single respondent did not
allow a separate analysis of the OSM providersrsquo views on the topic
B2B clients are organisations that engage in commercial practices directly through social media
They have a business-to-business relationship with the online social media providers In
contrast the end client can also appeal to intermediaries which act as a third party facilitating
commercial practices through social media In this case the end client does not engage directly
with the social media providers The stakeholders listed in Appendix 1 were interviewed about
their perspective on commercial practices through online social media These views are
summarised below with regard to the following key research topics
- The main topics of the interview concerned
- Commercial practices on OSM
- Novel functionalities and trends
- Potential concerns and benefits for consumers
- Misleading unfair and problematic commercial practices on OSM
- Potential remedies
- The roles of the stakeholders in the approval format and functionalities of marketing
content in OSM
- User issues and complaints
2 Methodology
Stakeholders were approached through GfK contacts in the sector contacts found through desk
research and interactions with consumer and advertiser associations The actors contacted
were invited for an open-ended telephone interview In total 53 interviews were conducted by
researchers dedicated to the project All interviews were recorded for further analysis
An interview guide was used to structure the 30- to 40-minute conversations containing open-
ended questions on the key topics At the start of the interview the respondents received
information on the context of the study Furthermore consent was obtained to report their
company name and to record the interview for analysis After the fieldwork the recordings
were summarised in a specific grid created for data analysis which was based on the key
research dimensions This grid included in Appendix 4 guided the analysis of the interviews
and the subsequent report-writing phase
3 Types of commercial practices and role of industry stakeholders
31 Commercial practices
Companies and organisations can engage in various types of commercial practices through
online social media The stakeholders interviewed differentiate two broad types of activities
posting lsquoorganicallyrsquo and engaging in lsquomarketingrsquo The former encompasses publishing
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interesting content without paying for it (eg posting stories or news on a companyrsquos own
social media page) the latter includes all types of payed-for commercial practices ndashsee below
Within marketing the type of practices used depends on the stage of the marketing process
The stakeholders first identify the lsquoawarenessrsquo stage (also called branding) in which the aim is
to reach a broad audience and provide them with an impression of a productservice Posting
pictures or video is suited in this phase as well as publishing an advertorial (ie a sponsored
article to be posted on social media) Intermediaries or B2B clients may for instance invest in
Facebook banner ads Sponsored Instagram ads Promoted pins on Pinterest or a skippable
lsquoprerollrsquo video on YouTube The focus in this phase is on reaching a certain number of users in
a certain amount of time and it can be linked to any type of engagement with an offer clicking
on it studying it liking it etcetera
A second phase in advertising concerns the conversion phase (also called performance) The
goal in this phase is to promote a specific productservice and to sell it More precise targeting
is therefore essential in this phase It can be accomplished by targeting on demographics or
interests remarketing (taking into account which productsservices the user researched
outside the OSM platform) targeting based on a list of users (from a company database from
individuals who subscribed to receive updates etcetera) For the actual purchase of the
productservice social media provide the opportunity of linking to a product page or facilitating
shopping through the social media platform (eg advertisers can add a shop section to a
brandrsquos Facebook page)1
In addition to those listed under the aforementioned phases of advertising certain other
commercial practices were discussed in the stakeholder interviews These practices include
paying social influencers for promoting productsservices managing (as an intermediary)
the social media pages and communities of brands and analysing what users are saying
about brands on social media These services are not offered by the OSM providers but by
third parties such as individual social influencers or intermediaries
32 The role of Intermediaries and B2B clients
For organisations that wish to engage in commercial practices on social media the possibilities
and options are plentiful To make the right decisions in terms of targeting content and general
strategy these organisations can turn to intermediaries A B2B client explains that it depends
on the budget and complexity of a campaign whether they set it up on their own or involve an
advertising company If the budget is high and the project is complex ndash in terms of targeting
format content or otherwise ndash an intermediary is more likely to become involved
This indicates the first role of intermediaries which is to provide advice to organisations that
aim to advertise through social media The intermediaries have expertise in both the functions
of social media platforms as well as in marketing strategies Offering this combined expertise
is an added value for their clients For this reason an interviewed B2B client values the
involvement of intermediaries
ldquoThe thing [intermediaries] got ndash and theyrsquore really so important for that ndash they got all
the knowledge about all the Facebook products about what works fine and what
doesnrsquot work fine They give us quite a bit of advice on what we should push on
1 On Facebook advertisers can set up a shop section and include a ldquoMessage to Buyrdquo button allowing consumers to indicate products they are interested in purchasing For the payment of the order users will be redirected to the merchantrsquos website as the option of payment through the Facebook platform is not (yet) available in the EU httpswwwfacebookcombusinesshelp912190892201033
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Facebook Twitter and YouTube as well So theyrsquove got all the knowledge and quite a
lot of experience with itrdquo
Second local and global intermediaries can have an important role in reaching the right target
groups and optimising the strategy for targeting audiences As the targeting options on social
media are extensive advertisers sometimes hire an intermediary to set up a campaign For
instance one of the interviewed B2B clients hired a marketing agency (as intermediary) to set
up the targeting of specific groups The intermediary in this case helped the client to take the
first steps in advertising through social media
Furthermore a subgroup of intermediaries offers software that facilitates advertising through
online social media or assessing the effectiveness of campaigns For example one of the
intermediaries has created software that assists in buying advertising space on Facebook
creating campaigns setting up target audiences etcetera Their software package can be
considered an efficiency tool which saves time for the end clients and allows them to advertise
on Facebook at a greater scale Other intermediaries create software for acquiring more
detailed metrics on campaigns and advanced statistics on the outcomes For instance an
intermediary offers a tool that shows the performance of an advertisement across multiple
platforms One of the interviewed academic furthermore refers to a software called Ditto that
analyses social media images for visual cues on brands and emotions These examples have in
common that they take advantage of the data available through social media and construct
more advanced metrics than those offered on the OSM platform
Finally intermediaries can take up the creation of content (visuals and texts) for social media
campaigns or they may handle all communication through social media of behalf of their client
(ie social media management) With regard to the control of contents and formats the
intermediaries indicate that their end client has the final word in approving the approach
Nevertheless a local intermediary remarked that their company would not assist costumers
that aim to place misleading ads or performs aggressive targeting
The aforementioned examples show that clients may cooperate with intermediaries in a variety
of cases In other instances however organisations choose to set up their campaigns
themselves For the majority of the interviewed B2B clients his implies using the platform tools
without any personal assistance Only B2B clients that have a large budget to spend on social
media advertising (or that represent highly popular brands) can rely on a direct contact person
(account manager) in the major social media As a B2B client phrases this
Were trying to reach out to [Facebook] to have a personalised relationship so that
we can ask stuff But thats only for top-tier clients that have like five million likes or
something They have an account manage but for us we dont have one yet
At least five B2B clients among the interviewed representatives do have account managers
For these companies the account managers offer a more accessible means of communication
with the OSM providers The companies tend to correspond with them mainly at the start of a
campaign or when a campaign is more complex
4 The role of OSM providers
41 Approval of content
Stakeholders indicate that social media providers have rules about what is accepted and not
accepted in an advertisement Facebook and Twitter for instance explicitly promote these
rules to advertisers For Facebook their policy concerns violence sexuality alcohol and drugs
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Moreover it also forbids lsquoclickbaitrsquo and images that contain over 20 percent of text Google
(YouTube) is quite strict in terms of regulating nudity in videos and LinkedIn also performs
automated checks on advertisements (eg the platforms restricts the use of capitalised
words) Overall the stakeholders have the impression that the rules on advertising in online
social media are quite strict A local intermediary adds that the rules have become more
restrictive over time in the beginning almost everything could have been posted online
whereas now it is more limited the intermediary reports
In practice when submitting an advertisement on Facebook it is checked through an
automated process Within 10 minutes the advertiser is notified whether the ad was
approved or rejected In case the advertiser disagrees with a rejection he or she can send
feedback after which someone will check the concerned advertisement Despite this automated
check the intermediaries and B2B clients indicate that Facebook cannot possibly check every
aspect of an ad as the volume is very high There is however a second mechanism through
which users can report problematic advertisements after they are published Ads on Facebook
feature reporting buttons and other means for all users to provide feedback A B2B client
explains that Facebook bases the price of a campaign on how successful it is (ie the number
of times it is liked by users) and to what extent it receives negative user reports If
advertisements are unsuccessful or frequently reported by users Facebook will increase the
price for the advertiser or ask the advertiser to make changes to the advertisement (in terms
of content pictures or wording) to increase its attractiveness It is furthermore reported that
negative user feedback can lead to the shutdown of campaigns
42 Format and functionalities
In terms of formats and functionalities social media are constantly innovating and
creating new marketing possibilities These new options are promoted towards
advertisers for instance by providing online trainings about the new features informing
advertisers through sales people or offering price incentives Through these methods for
instance Facebook has promoted video as an advertising format in order to compete with other
platforms most notably YouTube
The social media providers are balancing their need to offer new options and the trust of their
platform users For this purpose there are certain limitations to the formats For instance
when content is sponsored Facebook adds a label to the ad Users can also typically report an
advertisement when they think the format or contents are inappropriate (see also ldquoApproval of
contentrdquo)
In terms of functionality social media providers offer information about which users are
targeted These data are always anonymous as a global intermediary indicates
ldquoWe only get information about masses of people The only reason why we get this
kind of information is to make our message more relevant for peoplerdquo
Even though the provided metrics are very detailed (indicating language age
location ethnicity interests etcetera) they are only visible for segments of 1000 to
2000 users From the perspective of intermediaries and B2B clients this renders the metrics
somewhat unsatisfying A B2B client notes that if metrics were more granular it would be
easier to target the right users making them more satisfied An academic concurs that the
metrics are relatively high-level and suggests that OSM providers could give more information
about the number of individuals actually targeted compared to the desired target size On the
YouTube metrics a local intermediary remarks that they are poorly organised and highlight
mainly the number of ldquoclicksrdquo whereas not all clicks will bring the user to the advertisers
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website As an experienced user in advertising the intermediary adds one can create custom
reports and custom setting on YouTube resulting in metrics that are more useful
43 Targeting
The intermediaries and B2B clients indicate that the OSM providers have an important role in
providing targeting possibilities They offer the underlying data deliver the targeting options
design the settings and provide statistics The interviewees indicate that they receive
automated suggestions through the online interfaces for entering target groups All
the major social media providers (Facebook Google Twitter) offer this type of advice For
instance when an advertiser selects a keyword for targeting in Twitter the online interface will
suggest related keywords The possibilities are also extensive allowing to select specific target
groups A critique however is that the advertisers cannot verify whether the right profiles are
selected for a certain target group and if the right individuals have been reached In this regard
they have to trust the platform owners
Three types of information are used for targeting profile information (the demographic
and other data that users provide) interest-related data (based on for instance likes and
group membership) and behavioural data (based on what users do ie their location
browsing behaviour etcetera) Facebook is indicated to be most advanced in terms of the
offered targeting options as this platform has most data on its users The targeting can be
based on liked brands or pages watched picturesvideos activity on webpages outside
Facebook device location etcetera Furthermore YouTube is also mentioned as a well-
developed platform for targeting advertisements In addition certain platforms are
preferred to target broad groups of individuals For example Snapchat is well suited to
reach younger people whereas Instagram is more appropriate for targeting women Several
new targeting methods have been developed recently which will be discussed in more detail
in the following section
5 New functionalities
51 Identified trends
Social media offer many new possibilities in terms of commercial practices Firstly targeting
is a prime area for which new functionalities were identified In general the interviewees note
that targeting is becoming increasingly more sophisticated and efficient Two specific features
of Facebook were often named custom audiences and lookalike audiences The former
implies that companies use their client database (eg a CRM database containing e-mail
addresses or phone numbers) to specifically target the individuals in this database The
latter lookalike audiences is a functionality that allows targeting new users who have
similar characteristics as a specified group of individuals Performance metrics on these
targets could possibly be much more detailed down to the level of the individual but Facebook
does not allow metrics on custom audiences of fewer than 1000 individuals2
2 The Facebook Advertiser Help Center mentions this limitation with regard to metrics (Audience
Insights) on custom audiences httpswwwfacebookcombusinesshelp580994405331939
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Other novel types of targeting that were mentioned include remarketing (advertising based on
a usersrsquo visit of websites outside the OSM platform) and the linking of data from different
platforms An example of database linking includes the use of Facebook data to target users
on Instagram or the linking of Facebook and WhatsApp data
Additionally new functionalities in terms of formats were discussed The B2B clients and
intermediaries identified an increase in integration of content and advertising For
example commercial messages are more often being shown inside content space and
advertisement labelling has sometimes become less conspicuous Formats also
increasingly focus on keeping users on the social media platform instead of redirecting
them to other websites An example is the canvas advertisement on Facebook which is
essentially a small web page that users can navigate while staying on the Facebook platform
Furthermore video content is seen as an increasingly important format A global intermediary
confirms that videos are better received by consumers and yield better results compared to
traditional advertisements Finally important new indirect ways of advertising were identified
such as promoting brands through social influencers or having lsquonormalrsquo users promote
brands (eg by offering sponsored lenses (or lsquoframesrsquo) which individuals can apply to their
Snapchat pictures)
New functionalities were also observed with regard to metrics and statistics Firstly
advertisers can increasingly link their online advertisements to purchases A local
intermediary explains that when an item is promoted on multiple OSM platforms the
advertiser can determine from which platform the buyer arrived at the sellerrsquos website Second
new software can generate statistics that go beyond the overviews offered by the social media
platforms This software is provided to advertisers and intermediaries and collects the data
through the APIs of the social media platforms (eg Facebook and Twitter) One of the
interviewed intermediaries creates software that enables advertisers to assess which ads work
best with what audiences Another type of technology referred to by a global intermediary
measures what types of emotions are expressed through comments on commercial messages
Overall the advanced analysis by intermediaries of large amounts of raw data provided by
social media platforms is considered as an important new functionality
52 Potential problems and benefits for consumers
With the extensive options in terms of targeting and data usage privacy was often discussed
as a main concern More specifically critique was expressed on the use of client databases for
targeting on social media A local intermediary remarks that not all individuals in a company
database may have opted-in for targeting through social media Consumers may not be fully
aware that contact information collected ldquoofflinerdquo may be used for commercial
practices on social media As an academic notes this can be potentially worrisome
ldquoWhen I gave my phone number e-mail address or physical address I wouldnrsquot expect
those businesses to be able to track me on Facebook and target me with ads but now
they can That is a troubling new functionalityrdquo
Furthermore the practice of remarketing can be perceived as problematic in some cases A
local intermediary argues that retargeting may not be desirable for all products and users may
not wish their purchases (or purchase intentions) to be displayed on-screen Finally in addition
to being perceived as lsquospookyrsquo or lsquoscaryrsquo sophisticated targeting can be problematic when
different individuals are shown different offers (price discrimination) or when certain individuals
are excluded from offers With regard to the latter a consumer organisation identified a
particular risk in insurance companies that chose to advertise only to low-risk individuals (for
instance by targeting users based on their educational level) In terms of formats
commercial messages that look like regular content have the potential to mislead
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consumers Two advertisers organisations name this practice as particularly
problematic In their view consumers should not be misled by an ad that looks like editorial
content As one organisation adds it is especially problematic when such an advertisement
reaches young people who may not possess the background knowledge to discern ads from
editorial content Moreover it is problematic when advertisements are integrated into the social
interaction among users It can be perceived as highly intrusive to see an advertisement
between the Snapchat stories of friends or among private messages on Facebook In addition
to the aforementioned downsides certain benefits of more advanced targeting and data usage
were put forward by a broad range of interviewed actors The displayed advertisements are
more interesting and relevant for the social media users Because the content is more relevant
individuals will be less inclined to feel bothered by hem and instead appreciate the commercial
practices For the same reason the targeted messages may add value for consumers rather
than cause annoyance As a global intermediary summarises
ldquoIn a world where we get so many messages its [about] being relevant [in] what you
say being relevant about the type of product for a certain type of peoplerdquo
6 Misleading practices and remedies
61 Types of misleading practices
The interviewed representatives of B2B clients and Intermediaries indicate that they witnessed
only few instances of clearly misleading practices on the large social media They argue that
social media aim to avoid such misleading advertisements as they do not wish to upset users
Since advertising is a crucial element in their business model social media are very careful
about which advertising they show When prompted however the interviewed B2B clients and
Intermediaries were able to provide examples of misleading problematic and unfair commercial
practices Additional information is provided by consumer organisations and academics who
played particular attention to user data collected by social media They also referred to cases
of malware phishing and misleading promotions The types of misleading commercial practices
that are reported can be classified under the following five categories
Disguised marketing
First an often-mentioned problem is the difficulty to recognise advertising on social media
In part the difficulty to identify ads is related to their format For example on Facebook the
difference between sponsored content and user content is very subtle On Twitter as well it is
difficult to know if content is paid for when browsing hashtags A B2B client suggests that social
media purposefully integrate advertising and content
ldquoOn Facebook it is signalled when content is sponsored but it is not very
obvious and this is on purpose because Facebook does not want to show so
clearly that it is an ad
Furthermore commercial practices are sometimes difficult to recognise because the
commercial nature is not disclosed For example the presence of product placement may not
always be clearly labelled or indicated A specific case in this regard are social influencers
Celebrities or individuals who are popular on social media may be paid by brands to mention
or promote their products When they do not disclose being paid this can be misleading
towards consumers The latter problem is mentioned by several intermediaries and an
advertising self-regulatory body The advertisersrsquo organisation indicates that social influencers
are posting sponsored messages on social media but that they are not necessarily following
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the rules set out by self-regulatory bodies (ICC) and by the European Commission (UCPD) It
is argued that such failures may be due to inexperience and lack of familiarity with the existing
rules rather than a conscious intent not to adhere to them
Misleading marketing content
A second type of problematic commercial practice concerns misleading or incorrect product
or price descriptions This includes advertising with misleading information about the price
of a product (eg claiming something is free when it is not) the qualities of the product or
incorrectly claiming that an offer is limited in time This type of misinformation also includes
social media campaigns that are referring to a promotion which is no longer valid
Intermediaries and B2B clients further mentioned that product endorsements by social media
users may not always be fully genuine as they could be part of a lsquoshare and winrsquo or lsquolike and
winrsquo action
Undesirable or improper user targeting
Undesirable or improper user targeting is a third important problematic commercial practice
Several B2B clients and intermediaries mention that many users are unaware of how they are
being tracked and how this affects the advertisements that they see The fact that advertising
is personalised and targeted at specific groups without the users being fully knowledgeable
about it is perceived as problematic by an interviewed academic For example many social
media users may not be aware of any behavioural tracking that occurs (eg platforms tracking
the usersrsquo activities on their website and on many other websites that users visit) It implies
that users may not have been sufficiently informed to give consent to this type of tracking
Furthermore brands can advertise to users who have never lsquolikedrsquo the brandrsquos page or have
no interest in the brand at all (for instance by inserting advertisements on their Facebook News
Feed) A B2B client explains that this practice can make users angry based on individual
comments on the companyrsquos Facebook posts and private messages received through Facebook
Targeting can also fail when it is based on inaccurate information or wrong assumptions Users
may for instance be targeted with products they have already bought
Processing of private data
Fourthly participants in the stakeholder survey indicate that it is problematic when very
private data is not processed transparently Social media collect many different types of
information about their users including profile data activities on the platform real-world
location et cetera How these data are used however is not entirely clear to users The B2B
clients and consumer organisations expressed concern about what data is stored how safe it
is stored and whom it is shared with A consumer organisation mentioned that online social
media do not limit the storage of data in time ie it is stored indefinitely The same
organisation also points out a problematic example of a mobile phone banking app which sends
information to Facebook without notifying its users With WhatsApp being part of Facebook a
local intermediary finds it increasingly unclear which information shared with others is still
private and which can also be used for commercial purposes
Aggressive or criminal practices
A final type of problematic commercial practices concern cases of aggressive or criminal
practices Although the stakeholders indicated that criminal practices are not widespread on
social media they did refer to scams phishing and other illegal activities One particular
example provided by a global intermediary concerns a fake airline profile on social media
which promised that a user can win euro3000 by sharing a message These profile pages receive
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a high amount of visitors and can afterwards be sold on the black market Other cases
mentioned in two B2B interviews are about lsquoaggressiversquo advertisements and aggressive phone
calls after entering contact details on social media
62 Remedies
Various remedies are suggested to counter the aforementioned misleading unfair or
problematic practices The stakeholders interviewed see a role for advertisers social media
users platform owners and governments Intermediaries and B2B clients recognise their role
as advertisers to engage in fair commercial practices that are relevant for consumers In
addition these actors also point out the responsibilities of social media users The latter have
the ability to shape their online advertising environment by indicating which advertisements
they like or do not like As a global intermediary summarises it
ldquoId rather see something that I like or might like instead of tampon commercials So
you yourself [as a user] can make that ad environment just better and more personal
So why wouldnrsquot yourdquo
Furthermore users can report the ads that they find problematic through the automated
reporting on social media The interviewed intermediaries and B2B clients strongly encourage
this
Nevertheless social media providers also have a role in this process Certain B2B clients
and intermediary stakeholders indicate that it is unclear how complaints and reports are
handled Social media providers could be more lsquohands-onrsquo in dealing with user complaints and
when approving advertising Even though the platform owners do not have the capacity to
manually check every advertisement the interviewed advertisers stress the importance of
having a human being (in addition to a computer system) estimate which practices are
acceptable and which are not Furthermore a self-regulatory advertising body proposes that
social media immediately take down advertisements when the self-regulatory body has decided
that they are not acceptable
From the interviews with the different types of stakeholders three key steps to be taken by
social media providers emerged (1) simplify their terms and conditions as well as privacy
policy and present these terms to users in a clear and understandable way (2) label advertising
more prominently and ensure that the same wordingformatting is used throughout the entire
platform and (3) offer more options as opt-in features rather than opt-out With regard to the
first aspect a consumer organisation argues that If the terms of services are not available
and not understandable then its impossible to get an actual consent from the consumer
Finally certain participants in the survey identified a role for governments An intermediary
and consumer organisation suggest that governments (eg on a European level) should
monitor commercial practices performed on online social media and track new technologies
that could potentially violate consumer rights In terms of the current commercial practices on
social media the interviewees from different stakeholder categories identified the need for
laws on privacy and data protection to be adapted to the current practices on social
media Finally legislation is requested to ensure that social influencers are required to
disclose when they are being paid for certain messages With regard to the latter a global
intermediary adds the following
ldquoJust like we have to do on TV and say there is product placement in the TV
show you should be obliged to do it on your social mediardquo
7 Issues and complaints
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71 Consumers
Consumers have different means of complaining about problematic commercial practices on
social media The most common channel to voice complaints is through the social media
platforms themselves On Facebook users may for instance click negative emoticons post
comments or report the advertisement Less commonly private messages can also be sent
to advertisers Depending on the situation either social media providers deal with a complaint
(eg for complaints expressed through the reporting tool) or the advertiser handles it (eg
for complaints communicated through comments or private messages) Consumers almost
never address their complaints to intermediaries because for social media users it is not visible
which intermediaries are behind a campaign Intermediaries may deal with user complaints in
the name of their end clients or they may forward the complaints to their clients Certain
intermediaries are not at all involved in dealing with user complaints for example
intermediaries which offer software for metrics Some actors use a very structured approach
in answering user feedback One of the interviewed B2B clients makes use of a flow chart to
identify which actions to take in case of user positive neutral or negative consumer response
on social media
The interviewed B2B clients intermediaries and consumer organisations primarily identified
user complains concerning the high number of advertisements (lsquospammingrsquo or lsquopolluting their
contentrsquo) the targeting of commercial practices (mistargeting showing irrelevant ads or re-
targeting advertisement) and the difficulty to identify advertising and discern it from other
content With regard to the latter an advertising self-regulating body reports an
increase in the complaints about social influencers who do not clearly identify which
of their activities are sponsored
72 B2B clients
The issues and complaints that advertisers have are related to the social media platforms
Nevertheless the number of complaints is very limited When issues do arise they are
sometimes related to the platform disapproving an advertiserrsquos campaign without a clear
reason the complexity of the options when advertising on social media and the difficulty of
working with the platformrsquos API (Application Programming Interface)
8 Actions by enforcement authorities
Involvement of enforcement authorities was not a common action when dealing with
problematic commercial practices An important explanation for this is that ndash as multiple
stakeholders indicated ndash going to court takes time It is far more likely that a consumer
complaint is resolved by the advertising company or that a self-regulatory body is involved
The German advertising self-regulator pointed out that their process is much faster than a
court procedure However when the regulator lacks resources or when the complaint deals
with criminal activities the issue is taken to the enforcement authorities
When enforcement authorities are involved it usually concerns the most serious complaints
Examples mentioned by the interviewees include cases about criminal activities (Germany)
alcohol advertising (Poland) data collection (Italy) and out-of-stock products (Belgium) In
many of the cases mentioned in the interviews the government was involved by filing a
complaint against certain commercial practices
Whereas investigations against social influencers are not common in Europe the United States
enforce a more extensive legislation on this topic A respondent from a global intermediary was
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aware of a case in the United States where the legal authorities had fined YouTube influencers
for not disclosing sponsorship
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9 Conclusions
The stakeholder survey is part of subtask 14 which aimed to investigate marketing practices
on online social media from a traderrsquos point of view The survey consisted of 50 in-depth
interviews of stakeholders belonging to relevant subgroups with different perspectives and
explored the roles and responsibilities of OSM providers and other actors in the commercial
practices on their platforms More specifically the stakeholder survey aimed to acquire
information about which commercial practices can be found on social media and in what way
certain practices may be misleading unfair or problematic for consumers Additionally the
views of the different stakeholders were assessed and compared as well as their role in the
commercial practices
Types of commercial practices on social media
The stakeholders interviewed differentiate two broad types of activities
- Posting lsquoorganicallyrsquo publishing interesting content without paying for it
- Performing lsquomarketingrsquo engaging in payed-for commercial practices
Additional practices emerged during the interviews including paying social influencers for
promoting products or services managing the social media pages or communities of brands
and analysing what is being said about brands on social media These services can be offered
by local or global intermediaries or by individual social influencers
91 Novel commercial practices on social media
Throughout the stakeholder interviews different functionalities and targeting methods on social
media were discussed The four largest OSM platforms covered in the majority of the
interviews offer extensive possibilities for engaging in commercial practices To compete with
other platforms the major social media are also continuously creating new possibilities for
advertisers and traders which they promote through sales persons and tutorials
Among these new functionalities are extensive options for targeting advertisements The main
OSM platforms allow targeting based on information contained in the registered user profile
interest-related data and behavioural data A relatively new feature of targeting is the use of
custom audiences by targeting clients in the companyrsquos database on OSM platforms by
matching contact information Another example is the creation of lookalike audiences which
allows the targeting of new users who have similar characteristics as a specified group of
individuals Additionally it is also possible to target users who have visited a particular website
outside of the OSM platform Hence targeting through OSM platforms can be based on very
specific individual properties and behaviour
Because the targeting options are extensive advertisers sometimes chose to cooperate with
intermediaries Traders value intermediaries because of their expertise in both marketing
strategies and platform functionalities Intermediaries are therefore primarily used when
setting up a campaign that is complex in terms of targeting format or content Furthermore
intermediaries may also handle the creation of content and communication through OSM on
behalf of the client Finally certain intermediaries offer software facilitating social media
advertising and evaluating campaign effectiveness These additional features are made
possible because the intermediaries make use of the platformsrsquo API (application programming
interface) to provide data These additional statistics tap into the need for better metrics The
interviewed advertisers indicated that the statistics provided by the social media platforms are
not always adequate Even though the data are detailed the B2B clients and intermediaries
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indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
EUROPEAN COMMISSION
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2018 EUR 19 EN
In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 20 EN
10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 21 EN
Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
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2018 EUR 22 EN
102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
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Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
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Free publications
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via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
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Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
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1 Introduction
The following section describes the results of the stakeholder survey with six types of relevant
stakeholders B2B clients (14) local intermediaries (13) global intermediaries (11) consumer
organisations (3) advertisers organisations (8) and academics (4) OSM providers were also
contacted for participation in the survey although only a single OSM provider participated in
the research This interview was discarded as the response from a single respondent did not
allow a separate analysis of the OSM providersrsquo views on the topic
B2B clients are organisations that engage in commercial practices directly through social media
They have a business-to-business relationship with the online social media providers In
contrast the end client can also appeal to intermediaries which act as a third party facilitating
commercial practices through social media In this case the end client does not engage directly
with the social media providers The stakeholders listed in Appendix 1 were interviewed about
their perspective on commercial practices through online social media These views are
summarised below with regard to the following key research topics
- The main topics of the interview concerned
- Commercial practices on OSM
- Novel functionalities and trends
- Potential concerns and benefits for consumers
- Misleading unfair and problematic commercial practices on OSM
- Potential remedies
- The roles of the stakeholders in the approval format and functionalities of marketing
content in OSM
- User issues and complaints
2 Methodology
Stakeholders were approached through GfK contacts in the sector contacts found through desk
research and interactions with consumer and advertiser associations The actors contacted
were invited for an open-ended telephone interview In total 53 interviews were conducted by
researchers dedicated to the project All interviews were recorded for further analysis
An interview guide was used to structure the 30- to 40-minute conversations containing open-
ended questions on the key topics At the start of the interview the respondents received
information on the context of the study Furthermore consent was obtained to report their
company name and to record the interview for analysis After the fieldwork the recordings
were summarised in a specific grid created for data analysis which was based on the key
research dimensions This grid included in Appendix 4 guided the analysis of the interviews
and the subsequent report-writing phase
3 Types of commercial practices and role of industry stakeholders
31 Commercial practices
Companies and organisations can engage in various types of commercial practices through
online social media The stakeholders interviewed differentiate two broad types of activities
posting lsquoorganicallyrsquo and engaging in lsquomarketingrsquo The former encompasses publishing
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 7 EN
interesting content without paying for it (eg posting stories or news on a companyrsquos own
social media page) the latter includes all types of payed-for commercial practices ndashsee below
Within marketing the type of practices used depends on the stage of the marketing process
The stakeholders first identify the lsquoawarenessrsquo stage (also called branding) in which the aim is
to reach a broad audience and provide them with an impression of a productservice Posting
pictures or video is suited in this phase as well as publishing an advertorial (ie a sponsored
article to be posted on social media) Intermediaries or B2B clients may for instance invest in
Facebook banner ads Sponsored Instagram ads Promoted pins on Pinterest or a skippable
lsquoprerollrsquo video on YouTube The focus in this phase is on reaching a certain number of users in
a certain amount of time and it can be linked to any type of engagement with an offer clicking
on it studying it liking it etcetera
A second phase in advertising concerns the conversion phase (also called performance) The
goal in this phase is to promote a specific productservice and to sell it More precise targeting
is therefore essential in this phase It can be accomplished by targeting on demographics or
interests remarketing (taking into account which productsservices the user researched
outside the OSM platform) targeting based on a list of users (from a company database from
individuals who subscribed to receive updates etcetera) For the actual purchase of the
productservice social media provide the opportunity of linking to a product page or facilitating
shopping through the social media platform (eg advertisers can add a shop section to a
brandrsquos Facebook page)1
In addition to those listed under the aforementioned phases of advertising certain other
commercial practices were discussed in the stakeholder interviews These practices include
paying social influencers for promoting productsservices managing (as an intermediary)
the social media pages and communities of brands and analysing what users are saying
about brands on social media These services are not offered by the OSM providers but by
third parties such as individual social influencers or intermediaries
32 The role of Intermediaries and B2B clients
For organisations that wish to engage in commercial practices on social media the possibilities
and options are plentiful To make the right decisions in terms of targeting content and general
strategy these organisations can turn to intermediaries A B2B client explains that it depends
on the budget and complexity of a campaign whether they set it up on their own or involve an
advertising company If the budget is high and the project is complex ndash in terms of targeting
format content or otherwise ndash an intermediary is more likely to become involved
This indicates the first role of intermediaries which is to provide advice to organisations that
aim to advertise through social media The intermediaries have expertise in both the functions
of social media platforms as well as in marketing strategies Offering this combined expertise
is an added value for their clients For this reason an interviewed B2B client values the
involvement of intermediaries
ldquoThe thing [intermediaries] got ndash and theyrsquore really so important for that ndash they got all
the knowledge about all the Facebook products about what works fine and what
doesnrsquot work fine They give us quite a bit of advice on what we should push on
1 On Facebook advertisers can set up a shop section and include a ldquoMessage to Buyrdquo button allowing consumers to indicate products they are interested in purchasing For the payment of the order users will be redirected to the merchantrsquos website as the option of payment through the Facebook platform is not (yet) available in the EU httpswwwfacebookcombusinesshelp912190892201033
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 8 EN
Facebook Twitter and YouTube as well So theyrsquove got all the knowledge and quite a
lot of experience with itrdquo
Second local and global intermediaries can have an important role in reaching the right target
groups and optimising the strategy for targeting audiences As the targeting options on social
media are extensive advertisers sometimes hire an intermediary to set up a campaign For
instance one of the interviewed B2B clients hired a marketing agency (as intermediary) to set
up the targeting of specific groups The intermediary in this case helped the client to take the
first steps in advertising through social media
Furthermore a subgroup of intermediaries offers software that facilitates advertising through
online social media or assessing the effectiveness of campaigns For example one of the
intermediaries has created software that assists in buying advertising space on Facebook
creating campaigns setting up target audiences etcetera Their software package can be
considered an efficiency tool which saves time for the end clients and allows them to advertise
on Facebook at a greater scale Other intermediaries create software for acquiring more
detailed metrics on campaigns and advanced statistics on the outcomes For instance an
intermediary offers a tool that shows the performance of an advertisement across multiple
platforms One of the interviewed academic furthermore refers to a software called Ditto that
analyses social media images for visual cues on brands and emotions These examples have in
common that they take advantage of the data available through social media and construct
more advanced metrics than those offered on the OSM platform
Finally intermediaries can take up the creation of content (visuals and texts) for social media
campaigns or they may handle all communication through social media of behalf of their client
(ie social media management) With regard to the control of contents and formats the
intermediaries indicate that their end client has the final word in approving the approach
Nevertheless a local intermediary remarked that their company would not assist costumers
that aim to place misleading ads or performs aggressive targeting
The aforementioned examples show that clients may cooperate with intermediaries in a variety
of cases In other instances however organisations choose to set up their campaigns
themselves For the majority of the interviewed B2B clients his implies using the platform tools
without any personal assistance Only B2B clients that have a large budget to spend on social
media advertising (or that represent highly popular brands) can rely on a direct contact person
(account manager) in the major social media As a B2B client phrases this
Were trying to reach out to [Facebook] to have a personalised relationship so that
we can ask stuff But thats only for top-tier clients that have like five million likes or
something They have an account manage but for us we dont have one yet
At least five B2B clients among the interviewed representatives do have account managers
For these companies the account managers offer a more accessible means of communication
with the OSM providers The companies tend to correspond with them mainly at the start of a
campaign or when a campaign is more complex
4 The role of OSM providers
41 Approval of content
Stakeholders indicate that social media providers have rules about what is accepted and not
accepted in an advertisement Facebook and Twitter for instance explicitly promote these
rules to advertisers For Facebook their policy concerns violence sexuality alcohol and drugs
EUROPEAN COMMISSION
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2018 EUR 9 EN
Moreover it also forbids lsquoclickbaitrsquo and images that contain over 20 percent of text Google
(YouTube) is quite strict in terms of regulating nudity in videos and LinkedIn also performs
automated checks on advertisements (eg the platforms restricts the use of capitalised
words) Overall the stakeholders have the impression that the rules on advertising in online
social media are quite strict A local intermediary adds that the rules have become more
restrictive over time in the beginning almost everything could have been posted online
whereas now it is more limited the intermediary reports
In practice when submitting an advertisement on Facebook it is checked through an
automated process Within 10 minutes the advertiser is notified whether the ad was
approved or rejected In case the advertiser disagrees with a rejection he or she can send
feedback after which someone will check the concerned advertisement Despite this automated
check the intermediaries and B2B clients indicate that Facebook cannot possibly check every
aspect of an ad as the volume is very high There is however a second mechanism through
which users can report problematic advertisements after they are published Ads on Facebook
feature reporting buttons and other means for all users to provide feedback A B2B client
explains that Facebook bases the price of a campaign on how successful it is (ie the number
of times it is liked by users) and to what extent it receives negative user reports If
advertisements are unsuccessful or frequently reported by users Facebook will increase the
price for the advertiser or ask the advertiser to make changes to the advertisement (in terms
of content pictures or wording) to increase its attractiveness It is furthermore reported that
negative user feedback can lead to the shutdown of campaigns
42 Format and functionalities
In terms of formats and functionalities social media are constantly innovating and
creating new marketing possibilities These new options are promoted towards
advertisers for instance by providing online trainings about the new features informing
advertisers through sales people or offering price incentives Through these methods for
instance Facebook has promoted video as an advertising format in order to compete with other
platforms most notably YouTube
The social media providers are balancing their need to offer new options and the trust of their
platform users For this purpose there are certain limitations to the formats For instance
when content is sponsored Facebook adds a label to the ad Users can also typically report an
advertisement when they think the format or contents are inappropriate (see also ldquoApproval of
contentrdquo)
In terms of functionality social media providers offer information about which users are
targeted These data are always anonymous as a global intermediary indicates
ldquoWe only get information about masses of people The only reason why we get this
kind of information is to make our message more relevant for peoplerdquo
Even though the provided metrics are very detailed (indicating language age
location ethnicity interests etcetera) they are only visible for segments of 1000 to
2000 users From the perspective of intermediaries and B2B clients this renders the metrics
somewhat unsatisfying A B2B client notes that if metrics were more granular it would be
easier to target the right users making them more satisfied An academic concurs that the
metrics are relatively high-level and suggests that OSM providers could give more information
about the number of individuals actually targeted compared to the desired target size On the
YouTube metrics a local intermediary remarks that they are poorly organised and highlight
mainly the number of ldquoclicksrdquo whereas not all clicks will bring the user to the advertisers
EUROPEAN COMMISSION
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website As an experienced user in advertising the intermediary adds one can create custom
reports and custom setting on YouTube resulting in metrics that are more useful
43 Targeting
The intermediaries and B2B clients indicate that the OSM providers have an important role in
providing targeting possibilities They offer the underlying data deliver the targeting options
design the settings and provide statistics The interviewees indicate that they receive
automated suggestions through the online interfaces for entering target groups All
the major social media providers (Facebook Google Twitter) offer this type of advice For
instance when an advertiser selects a keyword for targeting in Twitter the online interface will
suggest related keywords The possibilities are also extensive allowing to select specific target
groups A critique however is that the advertisers cannot verify whether the right profiles are
selected for a certain target group and if the right individuals have been reached In this regard
they have to trust the platform owners
Three types of information are used for targeting profile information (the demographic
and other data that users provide) interest-related data (based on for instance likes and
group membership) and behavioural data (based on what users do ie their location
browsing behaviour etcetera) Facebook is indicated to be most advanced in terms of the
offered targeting options as this platform has most data on its users The targeting can be
based on liked brands or pages watched picturesvideos activity on webpages outside
Facebook device location etcetera Furthermore YouTube is also mentioned as a well-
developed platform for targeting advertisements In addition certain platforms are
preferred to target broad groups of individuals For example Snapchat is well suited to
reach younger people whereas Instagram is more appropriate for targeting women Several
new targeting methods have been developed recently which will be discussed in more detail
in the following section
5 New functionalities
51 Identified trends
Social media offer many new possibilities in terms of commercial practices Firstly targeting
is a prime area for which new functionalities were identified In general the interviewees note
that targeting is becoming increasingly more sophisticated and efficient Two specific features
of Facebook were often named custom audiences and lookalike audiences The former
implies that companies use their client database (eg a CRM database containing e-mail
addresses or phone numbers) to specifically target the individuals in this database The
latter lookalike audiences is a functionality that allows targeting new users who have
similar characteristics as a specified group of individuals Performance metrics on these
targets could possibly be much more detailed down to the level of the individual but Facebook
does not allow metrics on custom audiences of fewer than 1000 individuals2
2 The Facebook Advertiser Help Center mentions this limitation with regard to metrics (Audience
Insights) on custom audiences httpswwwfacebookcombusinesshelp580994405331939
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2018 EUR 11 EN
Other novel types of targeting that were mentioned include remarketing (advertising based on
a usersrsquo visit of websites outside the OSM platform) and the linking of data from different
platforms An example of database linking includes the use of Facebook data to target users
on Instagram or the linking of Facebook and WhatsApp data
Additionally new functionalities in terms of formats were discussed The B2B clients and
intermediaries identified an increase in integration of content and advertising For
example commercial messages are more often being shown inside content space and
advertisement labelling has sometimes become less conspicuous Formats also
increasingly focus on keeping users on the social media platform instead of redirecting
them to other websites An example is the canvas advertisement on Facebook which is
essentially a small web page that users can navigate while staying on the Facebook platform
Furthermore video content is seen as an increasingly important format A global intermediary
confirms that videos are better received by consumers and yield better results compared to
traditional advertisements Finally important new indirect ways of advertising were identified
such as promoting brands through social influencers or having lsquonormalrsquo users promote
brands (eg by offering sponsored lenses (or lsquoframesrsquo) which individuals can apply to their
Snapchat pictures)
New functionalities were also observed with regard to metrics and statistics Firstly
advertisers can increasingly link their online advertisements to purchases A local
intermediary explains that when an item is promoted on multiple OSM platforms the
advertiser can determine from which platform the buyer arrived at the sellerrsquos website Second
new software can generate statistics that go beyond the overviews offered by the social media
platforms This software is provided to advertisers and intermediaries and collects the data
through the APIs of the social media platforms (eg Facebook and Twitter) One of the
interviewed intermediaries creates software that enables advertisers to assess which ads work
best with what audiences Another type of technology referred to by a global intermediary
measures what types of emotions are expressed through comments on commercial messages
Overall the advanced analysis by intermediaries of large amounts of raw data provided by
social media platforms is considered as an important new functionality
52 Potential problems and benefits for consumers
With the extensive options in terms of targeting and data usage privacy was often discussed
as a main concern More specifically critique was expressed on the use of client databases for
targeting on social media A local intermediary remarks that not all individuals in a company
database may have opted-in for targeting through social media Consumers may not be fully
aware that contact information collected ldquoofflinerdquo may be used for commercial
practices on social media As an academic notes this can be potentially worrisome
ldquoWhen I gave my phone number e-mail address or physical address I wouldnrsquot expect
those businesses to be able to track me on Facebook and target me with ads but now
they can That is a troubling new functionalityrdquo
Furthermore the practice of remarketing can be perceived as problematic in some cases A
local intermediary argues that retargeting may not be desirable for all products and users may
not wish their purchases (or purchase intentions) to be displayed on-screen Finally in addition
to being perceived as lsquospookyrsquo or lsquoscaryrsquo sophisticated targeting can be problematic when
different individuals are shown different offers (price discrimination) or when certain individuals
are excluded from offers With regard to the latter a consumer organisation identified a
particular risk in insurance companies that chose to advertise only to low-risk individuals (for
instance by targeting users based on their educational level) In terms of formats
commercial messages that look like regular content have the potential to mislead
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2018 EUR 12 EN
consumers Two advertisers organisations name this practice as particularly
problematic In their view consumers should not be misled by an ad that looks like editorial
content As one organisation adds it is especially problematic when such an advertisement
reaches young people who may not possess the background knowledge to discern ads from
editorial content Moreover it is problematic when advertisements are integrated into the social
interaction among users It can be perceived as highly intrusive to see an advertisement
between the Snapchat stories of friends or among private messages on Facebook In addition
to the aforementioned downsides certain benefits of more advanced targeting and data usage
were put forward by a broad range of interviewed actors The displayed advertisements are
more interesting and relevant for the social media users Because the content is more relevant
individuals will be less inclined to feel bothered by hem and instead appreciate the commercial
practices For the same reason the targeted messages may add value for consumers rather
than cause annoyance As a global intermediary summarises
ldquoIn a world where we get so many messages its [about] being relevant [in] what you
say being relevant about the type of product for a certain type of peoplerdquo
6 Misleading practices and remedies
61 Types of misleading practices
The interviewed representatives of B2B clients and Intermediaries indicate that they witnessed
only few instances of clearly misleading practices on the large social media They argue that
social media aim to avoid such misleading advertisements as they do not wish to upset users
Since advertising is a crucial element in their business model social media are very careful
about which advertising they show When prompted however the interviewed B2B clients and
Intermediaries were able to provide examples of misleading problematic and unfair commercial
practices Additional information is provided by consumer organisations and academics who
played particular attention to user data collected by social media They also referred to cases
of malware phishing and misleading promotions The types of misleading commercial practices
that are reported can be classified under the following five categories
Disguised marketing
First an often-mentioned problem is the difficulty to recognise advertising on social media
In part the difficulty to identify ads is related to their format For example on Facebook the
difference between sponsored content and user content is very subtle On Twitter as well it is
difficult to know if content is paid for when browsing hashtags A B2B client suggests that social
media purposefully integrate advertising and content
ldquoOn Facebook it is signalled when content is sponsored but it is not very
obvious and this is on purpose because Facebook does not want to show so
clearly that it is an ad
Furthermore commercial practices are sometimes difficult to recognise because the
commercial nature is not disclosed For example the presence of product placement may not
always be clearly labelled or indicated A specific case in this regard are social influencers
Celebrities or individuals who are popular on social media may be paid by brands to mention
or promote their products When they do not disclose being paid this can be misleading
towards consumers The latter problem is mentioned by several intermediaries and an
advertising self-regulatory body The advertisersrsquo organisation indicates that social influencers
are posting sponsored messages on social media but that they are not necessarily following
EUROPEAN COMMISSION
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2018 EUR 13 EN
the rules set out by self-regulatory bodies (ICC) and by the European Commission (UCPD) It
is argued that such failures may be due to inexperience and lack of familiarity with the existing
rules rather than a conscious intent not to adhere to them
Misleading marketing content
A second type of problematic commercial practice concerns misleading or incorrect product
or price descriptions This includes advertising with misleading information about the price
of a product (eg claiming something is free when it is not) the qualities of the product or
incorrectly claiming that an offer is limited in time This type of misinformation also includes
social media campaigns that are referring to a promotion which is no longer valid
Intermediaries and B2B clients further mentioned that product endorsements by social media
users may not always be fully genuine as they could be part of a lsquoshare and winrsquo or lsquolike and
winrsquo action
Undesirable or improper user targeting
Undesirable or improper user targeting is a third important problematic commercial practice
Several B2B clients and intermediaries mention that many users are unaware of how they are
being tracked and how this affects the advertisements that they see The fact that advertising
is personalised and targeted at specific groups without the users being fully knowledgeable
about it is perceived as problematic by an interviewed academic For example many social
media users may not be aware of any behavioural tracking that occurs (eg platforms tracking
the usersrsquo activities on their website and on many other websites that users visit) It implies
that users may not have been sufficiently informed to give consent to this type of tracking
Furthermore brands can advertise to users who have never lsquolikedrsquo the brandrsquos page or have
no interest in the brand at all (for instance by inserting advertisements on their Facebook News
Feed) A B2B client explains that this practice can make users angry based on individual
comments on the companyrsquos Facebook posts and private messages received through Facebook
Targeting can also fail when it is based on inaccurate information or wrong assumptions Users
may for instance be targeted with products they have already bought
Processing of private data
Fourthly participants in the stakeholder survey indicate that it is problematic when very
private data is not processed transparently Social media collect many different types of
information about their users including profile data activities on the platform real-world
location et cetera How these data are used however is not entirely clear to users The B2B
clients and consumer organisations expressed concern about what data is stored how safe it
is stored and whom it is shared with A consumer organisation mentioned that online social
media do not limit the storage of data in time ie it is stored indefinitely The same
organisation also points out a problematic example of a mobile phone banking app which sends
information to Facebook without notifying its users With WhatsApp being part of Facebook a
local intermediary finds it increasingly unclear which information shared with others is still
private and which can also be used for commercial purposes
Aggressive or criminal practices
A final type of problematic commercial practices concern cases of aggressive or criminal
practices Although the stakeholders indicated that criminal practices are not widespread on
social media they did refer to scams phishing and other illegal activities One particular
example provided by a global intermediary concerns a fake airline profile on social media
which promised that a user can win euro3000 by sharing a message These profile pages receive
EUROPEAN COMMISSION
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2018 EUR 14 EN
a high amount of visitors and can afterwards be sold on the black market Other cases
mentioned in two B2B interviews are about lsquoaggressiversquo advertisements and aggressive phone
calls after entering contact details on social media
62 Remedies
Various remedies are suggested to counter the aforementioned misleading unfair or
problematic practices The stakeholders interviewed see a role for advertisers social media
users platform owners and governments Intermediaries and B2B clients recognise their role
as advertisers to engage in fair commercial practices that are relevant for consumers In
addition these actors also point out the responsibilities of social media users The latter have
the ability to shape their online advertising environment by indicating which advertisements
they like or do not like As a global intermediary summarises it
ldquoId rather see something that I like or might like instead of tampon commercials So
you yourself [as a user] can make that ad environment just better and more personal
So why wouldnrsquot yourdquo
Furthermore users can report the ads that they find problematic through the automated
reporting on social media The interviewed intermediaries and B2B clients strongly encourage
this
Nevertheless social media providers also have a role in this process Certain B2B clients
and intermediary stakeholders indicate that it is unclear how complaints and reports are
handled Social media providers could be more lsquohands-onrsquo in dealing with user complaints and
when approving advertising Even though the platform owners do not have the capacity to
manually check every advertisement the interviewed advertisers stress the importance of
having a human being (in addition to a computer system) estimate which practices are
acceptable and which are not Furthermore a self-regulatory advertising body proposes that
social media immediately take down advertisements when the self-regulatory body has decided
that they are not acceptable
From the interviews with the different types of stakeholders three key steps to be taken by
social media providers emerged (1) simplify their terms and conditions as well as privacy
policy and present these terms to users in a clear and understandable way (2) label advertising
more prominently and ensure that the same wordingformatting is used throughout the entire
platform and (3) offer more options as opt-in features rather than opt-out With regard to the
first aspect a consumer organisation argues that If the terms of services are not available
and not understandable then its impossible to get an actual consent from the consumer
Finally certain participants in the survey identified a role for governments An intermediary
and consumer organisation suggest that governments (eg on a European level) should
monitor commercial practices performed on online social media and track new technologies
that could potentially violate consumer rights In terms of the current commercial practices on
social media the interviewees from different stakeholder categories identified the need for
laws on privacy and data protection to be adapted to the current practices on social
media Finally legislation is requested to ensure that social influencers are required to
disclose when they are being paid for certain messages With regard to the latter a global
intermediary adds the following
ldquoJust like we have to do on TV and say there is product placement in the TV
show you should be obliged to do it on your social mediardquo
7 Issues and complaints
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2018 EUR 15 EN
71 Consumers
Consumers have different means of complaining about problematic commercial practices on
social media The most common channel to voice complaints is through the social media
platforms themselves On Facebook users may for instance click negative emoticons post
comments or report the advertisement Less commonly private messages can also be sent
to advertisers Depending on the situation either social media providers deal with a complaint
(eg for complaints expressed through the reporting tool) or the advertiser handles it (eg
for complaints communicated through comments or private messages) Consumers almost
never address their complaints to intermediaries because for social media users it is not visible
which intermediaries are behind a campaign Intermediaries may deal with user complaints in
the name of their end clients or they may forward the complaints to their clients Certain
intermediaries are not at all involved in dealing with user complaints for example
intermediaries which offer software for metrics Some actors use a very structured approach
in answering user feedback One of the interviewed B2B clients makes use of a flow chart to
identify which actions to take in case of user positive neutral or negative consumer response
on social media
The interviewed B2B clients intermediaries and consumer organisations primarily identified
user complains concerning the high number of advertisements (lsquospammingrsquo or lsquopolluting their
contentrsquo) the targeting of commercial practices (mistargeting showing irrelevant ads or re-
targeting advertisement) and the difficulty to identify advertising and discern it from other
content With regard to the latter an advertising self-regulating body reports an
increase in the complaints about social influencers who do not clearly identify which
of their activities are sponsored
72 B2B clients
The issues and complaints that advertisers have are related to the social media platforms
Nevertheless the number of complaints is very limited When issues do arise they are
sometimes related to the platform disapproving an advertiserrsquos campaign without a clear
reason the complexity of the options when advertising on social media and the difficulty of
working with the platformrsquos API (Application Programming Interface)
8 Actions by enforcement authorities
Involvement of enforcement authorities was not a common action when dealing with
problematic commercial practices An important explanation for this is that ndash as multiple
stakeholders indicated ndash going to court takes time It is far more likely that a consumer
complaint is resolved by the advertising company or that a self-regulatory body is involved
The German advertising self-regulator pointed out that their process is much faster than a
court procedure However when the regulator lacks resources or when the complaint deals
with criminal activities the issue is taken to the enforcement authorities
When enforcement authorities are involved it usually concerns the most serious complaints
Examples mentioned by the interviewees include cases about criminal activities (Germany)
alcohol advertising (Poland) data collection (Italy) and out-of-stock products (Belgium) In
many of the cases mentioned in the interviews the government was involved by filing a
complaint against certain commercial practices
Whereas investigations against social influencers are not common in Europe the United States
enforce a more extensive legislation on this topic A respondent from a global intermediary was
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2018 EUR 16 EN
aware of a case in the United States where the legal authorities had fined YouTube influencers
for not disclosing sponsorship
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 17 EN
9 Conclusions
The stakeholder survey is part of subtask 14 which aimed to investigate marketing practices
on online social media from a traderrsquos point of view The survey consisted of 50 in-depth
interviews of stakeholders belonging to relevant subgroups with different perspectives and
explored the roles and responsibilities of OSM providers and other actors in the commercial
practices on their platforms More specifically the stakeholder survey aimed to acquire
information about which commercial practices can be found on social media and in what way
certain practices may be misleading unfair or problematic for consumers Additionally the
views of the different stakeholders were assessed and compared as well as their role in the
commercial practices
Types of commercial practices on social media
The stakeholders interviewed differentiate two broad types of activities
- Posting lsquoorganicallyrsquo publishing interesting content without paying for it
- Performing lsquomarketingrsquo engaging in payed-for commercial practices
Additional practices emerged during the interviews including paying social influencers for
promoting products or services managing the social media pages or communities of brands
and analysing what is being said about brands on social media These services can be offered
by local or global intermediaries or by individual social influencers
91 Novel commercial practices on social media
Throughout the stakeholder interviews different functionalities and targeting methods on social
media were discussed The four largest OSM platforms covered in the majority of the
interviews offer extensive possibilities for engaging in commercial practices To compete with
other platforms the major social media are also continuously creating new possibilities for
advertisers and traders which they promote through sales persons and tutorials
Among these new functionalities are extensive options for targeting advertisements The main
OSM platforms allow targeting based on information contained in the registered user profile
interest-related data and behavioural data A relatively new feature of targeting is the use of
custom audiences by targeting clients in the companyrsquos database on OSM platforms by
matching contact information Another example is the creation of lookalike audiences which
allows the targeting of new users who have similar characteristics as a specified group of
individuals Additionally it is also possible to target users who have visited a particular website
outside of the OSM platform Hence targeting through OSM platforms can be based on very
specific individual properties and behaviour
Because the targeting options are extensive advertisers sometimes chose to cooperate with
intermediaries Traders value intermediaries because of their expertise in both marketing
strategies and platform functionalities Intermediaries are therefore primarily used when
setting up a campaign that is complex in terms of targeting format or content Furthermore
intermediaries may also handle the creation of content and communication through OSM on
behalf of the client Finally certain intermediaries offer software facilitating social media
advertising and evaluating campaign effectiveness These additional features are made
possible because the intermediaries make use of the platformsrsquo API (application programming
interface) to provide data These additional statistics tap into the need for better metrics The
interviewed advertisers indicated that the statistics provided by the social media platforms are
not always adequate Even though the data are detailed the B2B clients and intermediaries
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indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
EUROPEAN COMMISSION
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In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
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10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
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Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
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102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
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the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 24 EN
Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 7 EN
interesting content without paying for it (eg posting stories or news on a companyrsquos own
social media page) the latter includes all types of payed-for commercial practices ndashsee below
Within marketing the type of practices used depends on the stage of the marketing process
The stakeholders first identify the lsquoawarenessrsquo stage (also called branding) in which the aim is
to reach a broad audience and provide them with an impression of a productservice Posting
pictures or video is suited in this phase as well as publishing an advertorial (ie a sponsored
article to be posted on social media) Intermediaries or B2B clients may for instance invest in
Facebook banner ads Sponsored Instagram ads Promoted pins on Pinterest or a skippable
lsquoprerollrsquo video on YouTube The focus in this phase is on reaching a certain number of users in
a certain amount of time and it can be linked to any type of engagement with an offer clicking
on it studying it liking it etcetera
A second phase in advertising concerns the conversion phase (also called performance) The
goal in this phase is to promote a specific productservice and to sell it More precise targeting
is therefore essential in this phase It can be accomplished by targeting on demographics or
interests remarketing (taking into account which productsservices the user researched
outside the OSM platform) targeting based on a list of users (from a company database from
individuals who subscribed to receive updates etcetera) For the actual purchase of the
productservice social media provide the opportunity of linking to a product page or facilitating
shopping through the social media platform (eg advertisers can add a shop section to a
brandrsquos Facebook page)1
In addition to those listed under the aforementioned phases of advertising certain other
commercial practices were discussed in the stakeholder interviews These practices include
paying social influencers for promoting productsservices managing (as an intermediary)
the social media pages and communities of brands and analysing what users are saying
about brands on social media These services are not offered by the OSM providers but by
third parties such as individual social influencers or intermediaries
32 The role of Intermediaries and B2B clients
For organisations that wish to engage in commercial practices on social media the possibilities
and options are plentiful To make the right decisions in terms of targeting content and general
strategy these organisations can turn to intermediaries A B2B client explains that it depends
on the budget and complexity of a campaign whether they set it up on their own or involve an
advertising company If the budget is high and the project is complex ndash in terms of targeting
format content or otherwise ndash an intermediary is more likely to become involved
This indicates the first role of intermediaries which is to provide advice to organisations that
aim to advertise through social media The intermediaries have expertise in both the functions
of social media platforms as well as in marketing strategies Offering this combined expertise
is an added value for their clients For this reason an interviewed B2B client values the
involvement of intermediaries
ldquoThe thing [intermediaries] got ndash and theyrsquore really so important for that ndash they got all
the knowledge about all the Facebook products about what works fine and what
doesnrsquot work fine They give us quite a bit of advice on what we should push on
1 On Facebook advertisers can set up a shop section and include a ldquoMessage to Buyrdquo button allowing consumers to indicate products they are interested in purchasing For the payment of the order users will be redirected to the merchantrsquos website as the option of payment through the Facebook platform is not (yet) available in the EU httpswwwfacebookcombusinesshelp912190892201033
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 8 EN
Facebook Twitter and YouTube as well So theyrsquove got all the knowledge and quite a
lot of experience with itrdquo
Second local and global intermediaries can have an important role in reaching the right target
groups and optimising the strategy for targeting audiences As the targeting options on social
media are extensive advertisers sometimes hire an intermediary to set up a campaign For
instance one of the interviewed B2B clients hired a marketing agency (as intermediary) to set
up the targeting of specific groups The intermediary in this case helped the client to take the
first steps in advertising through social media
Furthermore a subgroup of intermediaries offers software that facilitates advertising through
online social media or assessing the effectiveness of campaigns For example one of the
intermediaries has created software that assists in buying advertising space on Facebook
creating campaigns setting up target audiences etcetera Their software package can be
considered an efficiency tool which saves time for the end clients and allows them to advertise
on Facebook at a greater scale Other intermediaries create software for acquiring more
detailed metrics on campaigns and advanced statistics on the outcomes For instance an
intermediary offers a tool that shows the performance of an advertisement across multiple
platforms One of the interviewed academic furthermore refers to a software called Ditto that
analyses social media images for visual cues on brands and emotions These examples have in
common that they take advantage of the data available through social media and construct
more advanced metrics than those offered on the OSM platform
Finally intermediaries can take up the creation of content (visuals and texts) for social media
campaigns or they may handle all communication through social media of behalf of their client
(ie social media management) With regard to the control of contents and formats the
intermediaries indicate that their end client has the final word in approving the approach
Nevertheless a local intermediary remarked that their company would not assist costumers
that aim to place misleading ads or performs aggressive targeting
The aforementioned examples show that clients may cooperate with intermediaries in a variety
of cases In other instances however organisations choose to set up their campaigns
themselves For the majority of the interviewed B2B clients his implies using the platform tools
without any personal assistance Only B2B clients that have a large budget to spend on social
media advertising (or that represent highly popular brands) can rely on a direct contact person
(account manager) in the major social media As a B2B client phrases this
Were trying to reach out to [Facebook] to have a personalised relationship so that
we can ask stuff But thats only for top-tier clients that have like five million likes or
something They have an account manage but for us we dont have one yet
At least five B2B clients among the interviewed representatives do have account managers
For these companies the account managers offer a more accessible means of communication
with the OSM providers The companies tend to correspond with them mainly at the start of a
campaign or when a campaign is more complex
4 The role of OSM providers
41 Approval of content
Stakeholders indicate that social media providers have rules about what is accepted and not
accepted in an advertisement Facebook and Twitter for instance explicitly promote these
rules to advertisers For Facebook their policy concerns violence sexuality alcohol and drugs
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 9 EN
Moreover it also forbids lsquoclickbaitrsquo and images that contain over 20 percent of text Google
(YouTube) is quite strict in terms of regulating nudity in videos and LinkedIn also performs
automated checks on advertisements (eg the platforms restricts the use of capitalised
words) Overall the stakeholders have the impression that the rules on advertising in online
social media are quite strict A local intermediary adds that the rules have become more
restrictive over time in the beginning almost everything could have been posted online
whereas now it is more limited the intermediary reports
In practice when submitting an advertisement on Facebook it is checked through an
automated process Within 10 minutes the advertiser is notified whether the ad was
approved or rejected In case the advertiser disagrees with a rejection he or she can send
feedback after which someone will check the concerned advertisement Despite this automated
check the intermediaries and B2B clients indicate that Facebook cannot possibly check every
aspect of an ad as the volume is very high There is however a second mechanism through
which users can report problematic advertisements after they are published Ads on Facebook
feature reporting buttons and other means for all users to provide feedback A B2B client
explains that Facebook bases the price of a campaign on how successful it is (ie the number
of times it is liked by users) and to what extent it receives negative user reports If
advertisements are unsuccessful or frequently reported by users Facebook will increase the
price for the advertiser or ask the advertiser to make changes to the advertisement (in terms
of content pictures or wording) to increase its attractiveness It is furthermore reported that
negative user feedback can lead to the shutdown of campaigns
42 Format and functionalities
In terms of formats and functionalities social media are constantly innovating and
creating new marketing possibilities These new options are promoted towards
advertisers for instance by providing online trainings about the new features informing
advertisers through sales people or offering price incentives Through these methods for
instance Facebook has promoted video as an advertising format in order to compete with other
platforms most notably YouTube
The social media providers are balancing their need to offer new options and the trust of their
platform users For this purpose there are certain limitations to the formats For instance
when content is sponsored Facebook adds a label to the ad Users can also typically report an
advertisement when they think the format or contents are inappropriate (see also ldquoApproval of
contentrdquo)
In terms of functionality social media providers offer information about which users are
targeted These data are always anonymous as a global intermediary indicates
ldquoWe only get information about masses of people The only reason why we get this
kind of information is to make our message more relevant for peoplerdquo
Even though the provided metrics are very detailed (indicating language age
location ethnicity interests etcetera) they are only visible for segments of 1000 to
2000 users From the perspective of intermediaries and B2B clients this renders the metrics
somewhat unsatisfying A B2B client notes that if metrics were more granular it would be
easier to target the right users making them more satisfied An academic concurs that the
metrics are relatively high-level and suggests that OSM providers could give more information
about the number of individuals actually targeted compared to the desired target size On the
YouTube metrics a local intermediary remarks that they are poorly organised and highlight
mainly the number of ldquoclicksrdquo whereas not all clicks will bring the user to the advertisers
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 10 EN
website As an experienced user in advertising the intermediary adds one can create custom
reports and custom setting on YouTube resulting in metrics that are more useful
43 Targeting
The intermediaries and B2B clients indicate that the OSM providers have an important role in
providing targeting possibilities They offer the underlying data deliver the targeting options
design the settings and provide statistics The interviewees indicate that they receive
automated suggestions through the online interfaces for entering target groups All
the major social media providers (Facebook Google Twitter) offer this type of advice For
instance when an advertiser selects a keyword for targeting in Twitter the online interface will
suggest related keywords The possibilities are also extensive allowing to select specific target
groups A critique however is that the advertisers cannot verify whether the right profiles are
selected for a certain target group and if the right individuals have been reached In this regard
they have to trust the platform owners
Three types of information are used for targeting profile information (the demographic
and other data that users provide) interest-related data (based on for instance likes and
group membership) and behavioural data (based on what users do ie their location
browsing behaviour etcetera) Facebook is indicated to be most advanced in terms of the
offered targeting options as this platform has most data on its users The targeting can be
based on liked brands or pages watched picturesvideos activity on webpages outside
Facebook device location etcetera Furthermore YouTube is also mentioned as a well-
developed platform for targeting advertisements In addition certain platforms are
preferred to target broad groups of individuals For example Snapchat is well suited to
reach younger people whereas Instagram is more appropriate for targeting women Several
new targeting methods have been developed recently which will be discussed in more detail
in the following section
5 New functionalities
51 Identified trends
Social media offer many new possibilities in terms of commercial practices Firstly targeting
is a prime area for which new functionalities were identified In general the interviewees note
that targeting is becoming increasingly more sophisticated and efficient Two specific features
of Facebook were often named custom audiences and lookalike audiences The former
implies that companies use their client database (eg a CRM database containing e-mail
addresses or phone numbers) to specifically target the individuals in this database The
latter lookalike audiences is a functionality that allows targeting new users who have
similar characteristics as a specified group of individuals Performance metrics on these
targets could possibly be much more detailed down to the level of the individual but Facebook
does not allow metrics on custom audiences of fewer than 1000 individuals2
2 The Facebook Advertiser Help Center mentions this limitation with regard to metrics (Audience
Insights) on custom audiences httpswwwfacebookcombusinesshelp580994405331939
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 11 EN
Other novel types of targeting that were mentioned include remarketing (advertising based on
a usersrsquo visit of websites outside the OSM platform) and the linking of data from different
platforms An example of database linking includes the use of Facebook data to target users
on Instagram or the linking of Facebook and WhatsApp data
Additionally new functionalities in terms of formats were discussed The B2B clients and
intermediaries identified an increase in integration of content and advertising For
example commercial messages are more often being shown inside content space and
advertisement labelling has sometimes become less conspicuous Formats also
increasingly focus on keeping users on the social media platform instead of redirecting
them to other websites An example is the canvas advertisement on Facebook which is
essentially a small web page that users can navigate while staying on the Facebook platform
Furthermore video content is seen as an increasingly important format A global intermediary
confirms that videos are better received by consumers and yield better results compared to
traditional advertisements Finally important new indirect ways of advertising were identified
such as promoting brands through social influencers or having lsquonormalrsquo users promote
brands (eg by offering sponsored lenses (or lsquoframesrsquo) which individuals can apply to their
Snapchat pictures)
New functionalities were also observed with regard to metrics and statistics Firstly
advertisers can increasingly link their online advertisements to purchases A local
intermediary explains that when an item is promoted on multiple OSM platforms the
advertiser can determine from which platform the buyer arrived at the sellerrsquos website Second
new software can generate statistics that go beyond the overviews offered by the social media
platforms This software is provided to advertisers and intermediaries and collects the data
through the APIs of the social media platforms (eg Facebook and Twitter) One of the
interviewed intermediaries creates software that enables advertisers to assess which ads work
best with what audiences Another type of technology referred to by a global intermediary
measures what types of emotions are expressed through comments on commercial messages
Overall the advanced analysis by intermediaries of large amounts of raw data provided by
social media platforms is considered as an important new functionality
52 Potential problems and benefits for consumers
With the extensive options in terms of targeting and data usage privacy was often discussed
as a main concern More specifically critique was expressed on the use of client databases for
targeting on social media A local intermediary remarks that not all individuals in a company
database may have opted-in for targeting through social media Consumers may not be fully
aware that contact information collected ldquoofflinerdquo may be used for commercial
practices on social media As an academic notes this can be potentially worrisome
ldquoWhen I gave my phone number e-mail address or physical address I wouldnrsquot expect
those businesses to be able to track me on Facebook and target me with ads but now
they can That is a troubling new functionalityrdquo
Furthermore the practice of remarketing can be perceived as problematic in some cases A
local intermediary argues that retargeting may not be desirable for all products and users may
not wish their purchases (or purchase intentions) to be displayed on-screen Finally in addition
to being perceived as lsquospookyrsquo or lsquoscaryrsquo sophisticated targeting can be problematic when
different individuals are shown different offers (price discrimination) or when certain individuals
are excluded from offers With regard to the latter a consumer organisation identified a
particular risk in insurance companies that chose to advertise only to low-risk individuals (for
instance by targeting users based on their educational level) In terms of formats
commercial messages that look like regular content have the potential to mislead
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 12 EN
consumers Two advertisers organisations name this practice as particularly
problematic In their view consumers should not be misled by an ad that looks like editorial
content As one organisation adds it is especially problematic when such an advertisement
reaches young people who may not possess the background knowledge to discern ads from
editorial content Moreover it is problematic when advertisements are integrated into the social
interaction among users It can be perceived as highly intrusive to see an advertisement
between the Snapchat stories of friends or among private messages on Facebook In addition
to the aforementioned downsides certain benefits of more advanced targeting and data usage
were put forward by a broad range of interviewed actors The displayed advertisements are
more interesting and relevant for the social media users Because the content is more relevant
individuals will be less inclined to feel bothered by hem and instead appreciate the commercial
practices For the same reason the targeted messages may add value for consumers rather
than cause annoyance As a global intermediary summarises
ldquoIn a world where we get so many messages its [about] being relevant [in] what you
say being relevant about the type of product for a certain type of peoplerdquo
6 Misleading practices and remedies
61 Types of misleading practices
The interviewed representatives of B2B clients and Intermediaries indicate that they witnessed
only few instances of clearly misleading practices on the large social media They argue that
social media aim to avoid such misleading advertisements as they do not wish to upset users
Since advertising is a crucial element in their business model social media are very careful
about which advertising they show When prompted however the interviewed B2B clients and
Intermediaries were able to provide examples of misleading problematic and unfair commercial
practices Additional information is provided by consumer organisations and academics who
played particular attention to user data collected by social media They also referred to cases
of malware phishing and misleading promotions The types of misleading commercial practices
that are reported can be classified under the following five categories
Disguised marketing
First an often-mentioned problem is the difficulty to recognise advertising on social media
In part the difficulty to identify ads is related to their format For example on Facebook the
difference between sponsored content and user content is very subtle On Twitter as well it is
difficult to know if content is paid for when browsing hashtags A B2B client suggests that social
media purposefully integrate advertising and content
ldquoOn Facebook it is signalled when content is sponsored but it is not very
obvious and this is on purpose because Facebook does not want to show so
clearly that it is an ad
Furthermore commercial practices are sometimes difficult to recognise because the
commercial nature is not disclosed For example the presence of product placement may not
always be clearly labelled or indicated A specific case in this regard are social influencers
Celebrities or individuals who are popular on social media may be paid by brands to mention
or promote their products When they do not disclose being paid this can be misleading
towards consumers The latter problem is mentioned by several intermediaries and an
advertising self-regulatory body The advertisersrsquo organisation indicates that social influencers
are posting sponsored messages on social media but that they are not necessarily following
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 13 EN
the rules set out by self-regulatory bodies (ICC) and by the European Commission (UCPD) It
is argued that such failures may be due to inexperience and lack of familiarity with the existing
rules rather than a conscious intent not to adhere to them
Misleading marketing content
A second type of problematic commercial practice concerns misleading or incorrect product
or price descriptions This includes advertising with misleading information about the price
of a product (eg claiming something is free when it is not) the qualities of the product or
incorrectly claiming that an offer is limited in time This type of misinformation also includes
social media campaigns that are referring to a promotion which is no longer valid
Intermediaries and B2B clients further mentioned that product endorsements by social media
users may not always be fully genuine as they could be part of a lsquoshare and winrsquo or lsquolike and
winrsquo action
Undesirable or improper user targeting
Undesirable or improper user targeting is a third important problematic commercial practice
Several B2B clients and intermediaries mention that many users are unaware of how they are
being tracked and how this affects the advertisements that they see The fact that advertising
is personalised and targeted at specific groups without the users being fully knowledgeable
about it is perceived as problematic by an interviewed academic For example many social
media users may not be aware of any behavioural tracking that occurs (eg platforms tracking
the usersrsquo activities on their website and on many other websites that users visit) It implies
that users may not have been sufficiently informed to give consent to this type of tracking
Furthermore brands can advertise to users who have never lsquolikedrsquo the brandrsquos page or have
no interest in the brand at all (for instance by inserting advertisements on their Facebook News
Feed) A B2B client explains that this practice can make users angry based on individual
comments on the companyrsquos Facebook posts and private messages received through Facebook
Targeting can also fail when it is based on inaccurate information or wrong assumptions Users
may for instance be targeted with products they have already bought
Processing of private data
Fourthly participants in the stakeholder survey indicate that it is problematic when very
private data is not processed transparently Social media collect many different types of
information about their users including profile data activities on the platform real-world
location et cetera How these data are used however is not entirely clear to users The B2B
clients and consumer organisations expressed concern about what data is stored how safe it
is stored and whom it is shared with A consumer organisation mentioned that online social
media do not limit the storage of data in time ie it is stored indefinitely The same
organisation also points out a problematic example of a mobile phone banking app which sends
information to Facebook without notifying its users With WhatsApp being part of Facebook a
local intermediary finds it increasingly unclear which information shared with others is still
private and which can also be used for commercial purposes
Aggressive or criminal practices
A final type of problematic commercial practices concern cases of aggressive or criminal
practices Although the stakeholders indicated that criminal practices are not widespread on
social media they did refer to scams phishing and other illegal activities One particular
example provided by a global intermediary concerns a fake airline profile on social media
which promised that a user can win euro3000 by sharing a message These profile pages receive
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 14 EN
a high amount of visitors and can afterwards be sold on the black market Other cases
mentioned in two B2B interviews are about lsquoaggressiversquo advertisements and aggressive phone
calls after entering contact details on social media
62 Remedies
Various remedies are suggested to counter the aforementioned misleading unfair or
problematic practices The stakeholders interviewed see a role for advertisers social media
users platform owners and governments Intermediaries and B2B clients recognise their role
as advertisers to engage in fair commercial practices that are relevant for consumers In
addition these actors also point out the responsibilities of social media users The latter have
the ability to shape their online advertising environment by indicating which advertisements
they like or do not like As a global intermediary summarises it
ldquoId rather see something that I like or might like instead of tampon commercials So
you yourself [as a user] can make that ad environment just better and more personal
So why wouldnrsquot yourdquo
Furthermore users can report the ads that they find problematic through the automated
reporting on social media The interviewed intermediaries and B2B clients strongly encourage
this
Nevertheless social media providers also have a role in this process Certain B2B clients
and intermediary stakeholders indicate that it is unclear how complaints and reports are
handled Social media providers could be more lsquohands-onrsquo in dealing with user complaints and
when approving advertising Even though the platform owners do not have the capacity to
manually check every advertisement the interviewed advertisers stress the importance of
having a human being (in addition to a computer system) estimate which practices are
acceptable and which are not Furthermore a self-regulatory advertising body proposes that
social media immediately take down advertisements when the self-regulatory body has decided
that they are not acceptable
From the interviews with the different types of stakeholders three key steps to be taken by
social media providers emerged (1) simplify their terms and conditions as well as privacy
policy and present these terms to users in a clear and understandable way (2) label advertising
more prominently and ensure that the same wordingformatting is used throughout the entire
platform and (3) offer more options as opt-in features rather than opt-out With regard to the
first aspect a consumer organisation argues that If the terms of services are not available
and not understandable then its impossible to get an actual consent from the consumer
Finally certain participants in the survey identified a role for governments An intermediary
and consumer organisation suggest that governments (eg on a European level) should
monitor commercial practices performed on online social media and track new technologies
that could potentially violate consumer rights In terms of the current commercial practices on
social media the interviewees from different stakeholder categories identified the need for
laws on privacy and data protection to be adapted to the current practices on social
media Finally legislation is requested to ensure that social influencers are required to
disclose when they are being paid for certain messages With regard to the latter a global
intermediary adds the following
ldquoJust like we have to do on TV and say there is product placement in the TV
show you should be obliged to do it on your social mediardquo
7 Issues and complaints
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 15 EN
71 Consumers
Consumers have different means of complaining about problematic commercial practices on
social media The most common channel to voice complaints is through the social media
platforms themselves On Facebook users may for instance click negative emoticons post
comments or report the advertisement Less commonly private messages can also be sent
to advertisers Depending on the situation either social media providers deal with a complaint
(eg for complaints expressed through the reporting tool) or the advertiser handles it (eg
for complaints communicated through comments or private messages) Consumers almost
never address their complaints to intermediaries because for social media users it is not visible
which intermediaries are behind a campaign Intermediaries may deal with user complaints in
the name of their end clients or they may forward the complaints to their clients Certain
intermediaries are not at all involved in dealing with user complaints for example
intermediaries which offer software for metrics Some actors use a very structured approach
in answering user feedback One of the interviewed B2B clients makes use of a flow chart to
identify which actions to take in case of user positive neutral or negative consumer response
on social media
The interviewed B2B clients intermediaries and consumer organisations primarily identified
user complains concerning the high number of advertisements (lsquospammingrsquo or lsquopolluting their
contentrsquo) the targeting of commercial practices (mistargeting showing irrelevant ads or re-
targeting advertisement) and the difficulty to identify advertising and discern it from other
content With regard to the latter an advertising self-regulating body reports an
increase in the complaints about social influencers who do not clearly identify which
of their activities are sponsored
72 B2B clients
The issues and complaints that advertisers have are related to the social media platforms
Nevertheless the number of complaints is very limited When issues do arise they are
sometimes related to the platform disapproving an advertiserrsquos campaign without a clear
reason the complexity of the options when advertising on social media and the difficulty of
working with the platformrsquos API (Application Programming Interface)
8 Actions by enforcement authorities
Involvement of enforcement authorities was not a common action when dealing with
problematic commercial practices An important explanation for this is that ndash as multiple
stakeholders indicated ndash going to court takes time It is far more likely that a consumer
complaint is resolved by the advertising company or that a self-regulatory body is involved
The German advertising self-regulator pointed out that their process is much faster than a
court procedure However when the regulator lacks resources or when the complaint deals
with criminal activities the issue is taken to the enforcement authorities
When enforcement authorities are involved it usually concerns the most serious complaints
Examples mentioned by the interviewees include cases about criminal activities (Germany)
alcohol advertising (Poland) data collection (Italy) and out-of-stock products (Belgium) In
many of the cases mentioned in the interviews the government was involved by filing a
complaint against certain commercial practices
Whereas investigations against social influencers are not common in Europe the United States
enforce a more extensive legislation on this topic A respondent from a global intermediary was
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 16 EN
aware of a case in the United States where the legal authorities had fined YouTube influencers
for not disclosing sponsorship
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 17 EN
9 Conclusions
The stakeholder survey is part of subtask 14 which aimed to investigate marketing practices
on online social media from a traderrsquos point of view The survey consisted of 50 in-depth
interviews of stakeholders belonging to relevant subgroups with different perspectives and
explored the roles and responsibilities of OSM providers and other actors in the commercial
practices on their platforms More specifically the stakeholder survey aimed to acquire
information about which commercial practices can be found on social media and in what way
certain practices may be misleading unfair or problematic for consumers Additionally the
views of the different stakeholders were assessed and compared as well as their role in the
commercial practices
Types of commercial practices on social media
The stakeholders interviewed differentiate two broad types of activities
- Posting lsquoorganicallyrsquo publishing interesting content without paying for it
- Performing lsquomarketingrsquo engaging in payed-for commercial practices
Additional practices emerged during the interviews including paying social influencers for
promoting products or services managing the social media pages or communities of brands
and analysing what is being said about brands on social media These services can be offered
by local or global intermediaries or by individual social influencers
91 Novel commercial practices on social media
Throughout the stakeholder interviews different functionalities and targeting methods on social
media were discussed The four largest OSM platforms covered in the majority of the
interviews offer extensive possibilities for engaging in commercial practices To compete with
other platforms the major social media are also continuously creating new possibilities for
advertisers and traders which they promote through sales persons and tutorials
Among these new functionalities are extensive options for targeting advertisements The main
OSM platforms allow targeting based on information contained in the registered user profile
interest-related data and behavioural data A relatively new feature of targeting is the use of
custom audiences by targeting clients in the companyrsquos database on OSM platforms by
matching contact information Another example is the creation of lookalike audiences which
allows the targeting of new users who have similar characteristics as a specified group of
individuals Additionally it is also possible to target users who have visited a particular website
outside of the OSM platform Hence targeting through OSM platforms can be based on very
specific individual properties and behaviour
Because the targeting options are extensive advertisers sometimes chose to cooperate with
intermediaries Traders value intermediaries because of their expertise in both marketing
strategies and platform functionalities Intermediaries are therefore primarily used when
setting up a campaign that is complex in terms of targeting format or content Furthermore
intermediaries may also handle the creation of content and communication through OSM on
behalf of the client Finally certain intermediaries offer software facilitating social media
advertising and evaluating campaign effectiveness These additional features are made
possible because the intermediaries make use of the platformsrsquo API (application programming
interface) to provide data These additional statistics tap into the need for better metrics The
interviewed advertisers indicated that the statistics provided by the social media platforms are
not always adequate Even though the data are detailed the B2B clients and intermediaries
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 18 EN
indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 19 EN
In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 20 EN
10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 21 EN
Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
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2018 EUR 22 EN
102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
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2018 EUR 24 EN
Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
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(httpeceuropaeurepresent_enhtm)
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(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
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EUROPEAN COMMISSION
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Facebook Twitter and YouTube as well So theyrsquove got all the knowledge and quite a
lot of experience with itrdquo
Second local and global intermediaries can have an important role in reaching the right target
groups and optimising the strategy for targeting audiences As the targeting options on social
media are extensive advertisers sometimes hire an intermediary to set up a campaign For
instance one of the interviewed B2B clients hired a marketing agency (as intermediary) to set
up the targeting of specific groups The intermediary in this case helped the client to take the
first steps in advertising through social media
Furthermore a subgroup of intermediaries offers software that facilitates advertising through
online social media or assessing the effectiveness of campaigns For example one of the
intermediaries has created software that assists in buying advertising space on Facebook
creating campaigns setting up target audiences etcetera Their software package can be
considered an efficiency tool which saves time for the end clients and allows them to advertise
on Facebook at a greater scale Other intermediaries create software for acquiring more
detailed metrics on campaigns and advanced statistics on the outcomes For instance an
intermediary offers a tool that shows the performance of an advertisement across multiple
platforms One of the interviewed academic furthermore refers to a software called Ditto that
analyses social media images for visual cues on brands and emotions These examples have in
common that they take advantage of the data available through social media and construct
more advanced metrics than those offered on the OSM platform
Finally intermediaries can take up the creation of content (visuals and texts) for social media
campaigns or they may handle all communication through social media of behalf of their client
(ie social media management) With regard to the control of contents and formats the
intermediaries indicate that their end client has the final word in approving the approach
Nevertheless a local intermediary remarked that their company would not assist costumers
that aim to place misleading ads or performs aggressive targeting
The aforementioned examples show that clients may cooperate with intermediaries in a variety
of cases In other instances however organisations choose to set up their campaigns
themselves For the majority of the interviewed B2B clients his implies using the platform tools
without any personal assistance Only B2B clients that have a large budget to spend on social
media advertising (or that represent highly popular brands) can rely on a direct contact person
(account manager) in the major social media As a B2B client phrases this
Were trying to reach out to [Facebook] to have a personalised relationship so that
we can ask stuff But thats only for top-tier clients that have like five million likes or
something They have an account manage but for us we dont have one yet
At least five B2B clients among the interviewed representatives do have account managers
For these companies the account managers offer a more accessible means of communication
with the OSM providers The companies tend to correspond with them mainly at the start of a
campaign or when a campaign is more complex
4 The role of OSM providers
41 Approval of content
Stakeholders indicate that social media providers have rules about what is accepted and not
accepted in an advertisement Facebook and Twitter for instance explicitly promote these
rules to advertisers For Facebook their policy concerns violence sexuality alcohol and drugs
EUROPEAN COMMISSION
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Moreover it also forbids lsquoclickbaitrsquo and images that contain over 20 percent of text Google
(YouTube) is quite strict in terms of regulating nudity in videos and LinkedIn also performs
automated checks on advertisements (eg the platforms restricts the use of capitalised
words) Overall the stakeholders have the impression that the rules on advertising in online
social media are quite strict A local intermediary adds that the rules have become more
restrictive over time in the beginning almost everything could have been posted online
whereas now it is more limited the intermediary reports
In practice when submitting an advertisement on Facebook it is checked through an
automated process Within 10 minutes the advertiser is notified whether the ad was
approved or rejected In case the advertiser disagrees with a rejection he or she can send
feedback after which someone will check the concerned advertisement Despite this automated
check the intermediaries and B2B clients indicate that Facebook cannot possibly check every
aspect of an ad as the volume is very high There is however a second mechanism through
which users can report problematic advertisements after they are published Ads on Facebook
feature reporting buttons and other means for all users to provide feedback A B2B client
explains that Facebook bases the price of a campaign on how successful it is (ie the number
of times it is liked by users) and to what extent it receives negative user reports If
advertisements are unsuccessful or frequently reported by users Facebook will increase the
price for the advertiser or ask the advertiser to make changes to the advertisement (in terms
of content pictures or wording) to increase its attractiveness It is furthermore reported that
negative user feedback can lead to the shutdown of campaigns
42 Format and functionalities
In terms of formats and functionalities social media are constantly innovating and
creating new marketing possibilities These new options are promoted towards
advertisers for instance by providing online trainings about the new features informing
advertisers through sales people or offering price incentives Through these methods for
instance Facebook has promoted video as an advertising format in order to compete with other
platforms most notably YouTube
The social media providers are balancing their need to offer new options and the trust of their
platform users For this purpose there are certain limitations to the formats For instance
when content is sponsored Facebook adds a label to the ad Users can also typically report an
advertisement when they think the format or contents are inappropriate (see also ldquoApproval of
contentrdquo)
In terms of functionality social media providers offer information about which users are
targeted These data are always anonymous as a global intermediary indicates
ldquoWe only get information about masses of people The only reason why we get this
kind of information is to make our message more relevant for peoplerdquo
Even though the provided metrics are very detailed (indicating language age
location ethnicity interests etcetera) they are only visible for segments of 1000 to
2000 users From the perspective of intermediaries and B2B clients this renders the metrics
somewhat unsatisfying A B2B client notes that if metrics were more granular it would be
easier to target the right users making them more satisfied An academic concurs that the
metrics are relatively high-level and suggests that OSM providers could give more information
about the number of individuals actually targeted compared to the desired target size On the
YouTube metrics a local intermediary remarks that they are poorly organised and highlight
mainly the number of ldquoclicksrdquo whereas not all clicks will bring the user to the advertisers
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2018 EUR 10 EN
website As an experienced user in advertising the intermediary adds one can create custom
reports and custom setting on YouTube resulting in metrics that are more useful
43 Targeting
The intermediaries and B2B clients indicate that the OSM providers have an important role in
providing targeting possibilities They offer the underlying data deliver the targeting options
design the settings and provide statistics The interviewees indicate that they receive
automated suggestions through the online interfaces for entering target groups All
the major social media providers (Facebook Google Twitter) offer this type of advice For
instance when an advertiser selects a keyword for targeting in Twitter the online interface will
suggest related keywords The possibilities are also extensive allowing to select specific target
groups A critique however is that the advertisers cannot verify whether the right profiles are
selected for a certain target group and if the right individuals have been reached In this regard
they have to trust the platform owners
Three types of information are used for targeting profile information (the demographic
and other data that users provide) interest-related data (based on for instance likes and
group membership) and behavioural data (based on what users do ie their location
browsing behaviour etcetera) Facebook is indicated to be most advanced in terms of the
offered targeting options as this platform has most data on its users The targeting can be
based on liked brands or pages watched picturesvideos activity on webpages outside
Facebook device location etcetera Furthermore YouTube is also mentioned as a well-
developed platform for targeting advertisements In addition certain platforms are
preferred to target broad groups of individuals For example Snapchat is well suited to
reach younger people whereas Instagram is more appropriate for targeting women Several
new targeting methods have been developed recently which will be discussed in more detail
in the following section
5 New functionalities
51 Identified trends
Social media offer many new possibilities in terms of commercial practices Firstly targeting
is a prime area for which new functionalities were identified In general the interviewees note
that targeting is becoming increasingly more sophisticated and efficient Two specific features
of Facebook were often named custom audiences and lookalike audiences The former
implies that companies use their client database (eg a CRM database containing e-mail
addresses or phone numbers) to specifically target the individuals in this database The
latter lookalike audiences is a functionality that allows targeting new users who have
similar characteristics as a specified group of individuals Performance metrics on these
targets could possibly be much more detailed down to the level of the individual but Facebook
does not allow metrics on custom audiences of fewer than 1000 individuals2
2 The Facebook Advertiser Help Center mentions this limitation with regard to metrics (Audience
Insights) on custom audiences httpswwwfacebookcombusinesshelp580994405331939
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2018 EUR 11 EN
Other novel types of targeting that were mentioned include remarketing (advertising based on
a usersrsquo visit of websites outside the OSM platform) and the linking of data from different
platforms An example of database linking includes the use of Facebook data to target users
on Instagram or the linking of Facebook and WhatsApp data
Additionally new functionalities in terms of formats were discussed The B2B clients and
intermediaries identified an increase in integration of content and advertising For
example commercial messages are more often being shown inside content space and
advertisement labelling has sometimes become less conspicuous Formats also
increasingly focus on keeping users on the social media platform instead of redirecting
them to other websites An example is the canvas advertisement on Facebook which is
essentially a small web page that users can navigate while staying on the Facebook platform
Furthermore video content is seen as an increasingly important format A global intermediary
confirms that videos are better received by consumers and yield better results compared to
traditional advertisements Finally important new indirect ways of advertising were identified
such as promoting brands through social influencers or having lsquonormalrsquo users promote
brands (eg by offering sponsored lenses (or lsquoframesrsquo) which individuals can apply to their
Snapchat pictures)
New functionalities were also observed with regard to metrics and statistics Firstly
advertisers can increasingly link their online advertisements to purchases A local
intermediary explains that when an item is promoted on multiple OSM platforms the
advertiser can determine from which platform the buyer arrived at the sellerrsquos website Second
new software can generate statistics that go beyond the overviews offered by the social media
platforms This software is provided to advertisers and intermediaries and collects the data
through the APIs of the social media platforms (eg Facebook and Twitter) One of the
interviewed intermediaries creates software that enables advertisers to assess which ads work
best with what audiences Another type of technology referred to by a global intermediary
measures what types of emotions are expressed through comments on commercial messages
Overall the advanced analysis by intermediaries of large amounts of raw data provided by
social media platforms is considered as an important new functionality
52 Potential problems and benefits for consumers
With the extensive options in terms of targeting and data usage privacy was often discussed
as a main concern More specifically critique was expressed on the use of client databases for
targeting on social media A local intermediary remarks that not all individuals in a company
database may have opted-in for targeting through social media Consumers may not be fully
aware that contact information collected ldquoofflinerdquo may be used for commercial
practices on social media As an academic notes this can be potentially worrisome
ldquoWhen I gave my phone number e-mail address or physical address I wouldnrsquot expect
those businesses to be able to track me on Facebook and target me with ads but now
they can That is a troubling new functionalityrdquo
Furthermore the practice of remarketing can be perceived as problematic in some cases A
local intermediary argues that retargeting may not be desirable for all products and users may
not wish their purchases (or purchase intentions) to be displayed on-screen Finally in addition
to being perceived as lsquospookyrsquo or lsquoscaryrsquo sophisticated targeting can be problematic when
different individuals are shown different offers (price discrimination) or when certain individuals
are excluded from offers With regard to the latter a consumer organisation identified a
particular risk in insurance companies that chose to advertise only to low-risk individuals (for
instance by targeting users based on their educational level) In terms of formats
commercial messages that look like regular content have the potential to mislead
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2018 EUR 12 EN
consumers Two advertisers organisations name this practice as particularly
problematic In their view consumers should not be misled by an ad that looks like editorial
content As one organisation adds it is especially problematic when such an advertisement
reaches young people who may not possess the background knowledge to discern ads from
editorial content Moreover it is problematic when advertisements are integrated into the social
interaction among users It can be perceived as highly intrusive to see an advertisement
between the Snapchat stories of friends or among private messages on Facebook In addition
to the aforementioned downsides certain benefits of more advanced targeting and data usage
were put forward by a broad range of interviewed actors The displayed advertisements are
more interesting and relevant for the social media users Because the content is more relevant
individuals will be less inclined to feel bothered by hem and instead appreciate the commercial
practices For the same reason the targeted messages may add value for consumers rather
than cause annoyance As a global intermediary summarises
ldquoIn a world where we get so many messages its [about] being relevant [in] what you
say being relevant about the type of product for a certain type of peoplerdquo
6 Misleading practices and remedies
61 Types of misleading practices
The interviewed representatives of B2B clients and Intermediaries indicate that they witnessed
only few instances of clearly misleading practices on the large social media They argue that
social media aim to avoid such misleading advertisements as they do not wish to upset users
Since advertising is a crucial element in their business model social media are very careful
about which advertising they show When prompted however the interviewed B2B clients and
Intermediaries were able to provide examples of misleading problematic and unfair commercial
practices Additional information is provided by consumer organisations and academics who
played particular attention to user data collected by social media They also referred to cases
of malware phishing and misleading promotions The types of misleading commercial practices
that are reported can be classified under the following five categories
Disguised marketing
First an often-mentioned problem is the difficulty to recognise advertising on social media
In part the difficulty to identify ads is related to their format For example on Facebook the
difference between sponsored content and user content is very subtle On Twitter as well it is
difficult to know if content is paid for when browsing hashtags A B2B client suggests that social
media purposefully integrate advertising and content
ldquoOn Facebook it is signalled when content is sponsored but it is not very
obvious and this is on purpose because Facebook does not want to show so
clearly that it is an ad
Furthermore commercial practices are sometimes difficult to recognise because the
commercial nature is not disclosed For example the presence of product placement may not
always be clearly labelled or indicated A specific case in this regard are social influencers
Celebrities or individuals who are popular on social media may be paid by brands to mention
or promote their products When they do not disclose being paid this can be misleading
towards consumers The latter problem is mentioned by several intermediaries and an
advertising self-regulatory body The advertisersrsquo organisation indicates that social influencers
are posting sponsored messages on social media but that they are not necessarily following
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2018 EUR 13 EN
the rules set out by self-regulatory bodies (ICC) and by the European Commission (UCPD) It
is argued that such failures may be due to inexperience and lack of familiarity with the existing
rules rather than a conscious intent not to adhere to them
Misleading marketing content
A second type of problematic commercial practice concerns misleading or incorrect product
or price descriptions This includes advertising with misleading information about the price
of a product (eg claiming something is free when it is not) the qualities of the product or
incorrectly claiming that an offer is limited in time This type of misinformation also includes
social media campaigns that are referring to a promotion which is no longer valid
Intermediaries and B2B clients further mentioned that product endorsements by social media
users may not always be fully genuine as they could be part of a lsquoshare and winrsquo or lsquolike and
winrsquo action
Undesirable or improper user targeting
Undesirable or improper user targeting is a third important problematic commercial practice
Several B2B clients and intermediaries mention that many users are unaware of how they are
being tracked and how this affects the advertisements that they see The fact that advertising
is personalised and targeted at specific groups without the users being fully knowledgeable
about it is perceived as problematic by an interviewed academic For example many social
media users may not be aware of any behavioural tracking that occurs (eg platforms tracking
the usersrsquo activities on their website and on many other websites that users visit) It implies
that users may not have been sufficiently informed to give consent to this type of tracking
Furthermore brands can advertise to users who have never lsquolikedrsquo the brandrsquos page or have
no interest in the brand at all (for instance by inserting advertisements on their Facebook News
Feed) A B2B client explains that this practice can make users angry based on individual
comments on the companyrsquos Facebook posts and private messages received through Facebook
Targeting can also fail when it is based on inaccurate information or wrong assumptions Users
may for instance be targeted with products they have already bought
Processing of private data
Fourthly participants in the stakeholder survey indicate that it is problematic when very
private data is not processed transparently Social media collect many different types of
information about their users including profile data activities on the platform real-world
location et cetera How these data are used however is not entirely clear to users The B2B
clients and consumer organisations expressed concern about what data is stored how safe it
is stored and whom it is shared with A consumer organisation mentioned that online social
media do not limit the storage of data in time ie it is stored indefinitely The same
organisation also points out a problematic example of a mobile phone banking app which sends
information to Facebook without notifying its users With WhatsApp being part of Facebook a
local intermediary finds it increasingly unclear which information shared with others is still
private and which can also be used for commercial purposes
Aggressive or criminal practices
A final type of problematic commercial practices concern cases of aggressive or criminal
practices Although the stakeholders indicated that criminal practices are not widespread on
social media they did refer to scams phishing and other illegal activities One particular
example provided by a global intermediary concerns a fake airline profile on social media
which promised that a user can win euro3000 by sharing a message These profile pages receive
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a high amount of visitors and can afterwards be sold on the black market Other cases
mentioned in two B2B interviews are about lsquoaggressiversquo advertisements and aggressive phone
calls after entering contact details on social media
62 Remedies
Various remedies are suggested to counter the aforementioned misleading unfair or
problematic practices The stakeholders interviewed see a role for advertisers social media
users platform owners and governments Intermediaries and B2B clients recognise their role
as advertisers to engage in fair commercial practices that are relevant for consumers In
addition these actors also point out the responsibilities of social media users The latter have
the ability to shape their online advertising environment by indicating which advertisements
they like or do not like As a global intermediary summarises it
ldquoId rather see something that I like or might like instead of tampon commercials So
you yourself [as a user] can make that ad environment just better and more personal
So why wouldnrsquot yourdquo
Furthermore users can report the ads that they find problematic through the automated
reporting on social media The interviewed intermediaries and B2B clients strongly encourage
this
Nevertheless social media providers also have a role in this process Certain B2B clients
and intermediary stakeholders indicate that it is unclear how complaints and reports are
handled Social media providers could be more lsquohands-onrsquo in dealing with user complaints and
when approving advertising Even though the platform owners do not have the capacity to
manually check every advertisement the interviewed advertisers stress the importance of
having a human being (in addition to a computer system) estimate which practices are
acceptable and which are not Furthermore a self-regulatory advertising body proposes that
social media immediately take down advertisements when the self-regulatory body has decided
that they are not acceptable
From the interviews with the different types of stakeholders three key steps to be taken by
social media providers emerged (1) simplify their terms and conditions as well as privacy
policy and present these terms to users in a clear and understandable way (2) label advertising
more prominently and ensure that the same wordingformatting is used throughout the entire
platform and (3) offer more options as opt-in features rather than opt-out With regard to the
first aspect a consumer organisation argues that If the terms of services are not available
and not understandable then its impossible to get an actual consent from the consumer
Finally certain participants in the survey identified a role for governments An intermediary
and consumer organisation suggest that governments (eg on a European level) should
monitor commercial practices performed on online social media and track new technologies
that could potentially violate consumer rights In terms of the current commercial practices on
social media the interviewees from different stakeholder categories identified the need for
laws on privacy and data protection to be adapted to the current practices on social
media Finally legislation is requested to ensure that social influencers are required to
disclose when they are being paid for certain messages With regard to the latter a global
intermediary adds the following
ldquoJust like we have to do on TV and say there is product placement in the TV
show you should be obliged to do it on your social mediardquo
7 Issues and complaints
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71 Consumers
Consumers have different means of complaining about problematic commercial practices on
social media The most common channel to voice complaints is through the social media
platforms themselves On Facebook users may for instance click negative emoticons post
comments or report the advertisement Less commonly private messages can also be sent
to advertisers Depending on the situation either social media providers deal with a complaint
(eg for complaints expressed through the reporting tool) or the advertiser handles it (eg
for complaints communicated through comments or private messages) Consumers almost
never address their complaints to intermediaries because for social media users it is not visible
which intermediaries are behind a campaign Intermediaries may deal with user complaints in
the name of their end clients or they may forward the complaints to their clients Certain
intermediaries are not at all involved in dealing with user complaints for example
intermediaries which offer software for metrics Some actors use a very structured approach
in answering user feedback One of the interviewed B2B clients makes use of a flow chart to
identify which actions to take in case of user positive neutral or negative consumer response
on social media
The interviewed B2B clients intermediaries and consumer organisations primarily identified
user complains concerning the high number of advertisements (lsquospammingrsquo or lsquopolluting their
contentrsquo) the targeting of commercial practices (mistargeting showing irrelevant ads or re-
targeting advertisement) and the difficulty to identify advertising and discern it from other
content With regard to the latter an advertising self-regulating body reports an
increase in the complaints about social influencers who do not clearly identify which
of their activities are sponsored
72 B2B clients
The issues and complaints that advertisers have are related to the social media platforms
Nevertheless the number of complaints is very limited When issues do arise they are
sometimes related to the platform disapproving an advertiserrsquos campaign without a clear
reason the complexity of the options when advertising on social media and the difficulty of
working with the platformrsquos API (Application Programming Interface)
8 Actions by enforcement authorities
Involvement of enforcement authorities was not a common action when dealing with
problematic commercial practices An important explanation for this is that ndash as multiple
stakeholders indicated ndash going to court takes time It is far more likely that a consumer
complaint is resolved by the advertising company or that a self-regulatory body is involved
The German advertising self-regulator pointed out that their process is much faster than a
court procedure However when the regulator lacks resources or when the complaint deals
with criminal activities the issue is taken to the enforcement authorities
When enforcement authorities are involved it usually concerns the most serious complaints
Examples mentioned by the interviewees include cases about criminal activities (Germany)
alcohol advertising (Poland) data collection (Italy) and out-of-stock products (Belgium) In
many of the cases mentioned in the interviews the government was involved by filing a
complaint against certain commercial practices
Whereas investigations against social influencers are not common in Europe the United States
enforce a more extensive legislation on this topic A respondent from a global intermediary was
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aware of a case in the United States where the legal authorities had fined YouTube influencers
for not disclosing sponsorship
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9 Conclusions
The stakeholder survey is part of subtask 14 which aimed to investigate marketing practices
on online social media from a traderrsquos point of view The survey consisted of 50 in-depth
interviews of stakeholders belonging to relevant subgroups with different perspectives and
explored the roles and responsibilities of OSM providers and other actors in the commercial
practices on their platforms More specifically the stakeholder survey aimed to acquire
information about which commercial practices can be found on social media and in what way
certain practices may be misleading unfair or problematic for consumers Additionally the
views of the different stakeholders were assessed and compared as well as their role in the
commercial practices
Types of commercial practices on social media
The stakeholders interviewed differentiate two broad types of activities
- Posting lsquoorganicallyrsquo publishing interesting content without paying for it
- Performing lsquomarketingrsquo engaging in payed-for commercial practices
Additional practices emerged during the interviews including paying social influencers for
promoting products or services managing the social media pages or communities of brands
and analysing what is being said about brands on social media These services can be offered
by local or global intermediaries or by individual social influencers
91 Novel commercial practices on social media
Throughout the stakeholder interviews different functionalities and targeting methods on social
media were discussed The four largest OSM platforms covered in the majority of the
interviews offer extensive possibilities for engaging in commercial practices To compete with
other platforms the major social media are also continuously creating new possibilities for
advertisers and traders which they promote through sales persons and tutorials
Among these new functionalities are extensive options for targeting advertisements The main
OSM platforms allow targeting based on information contained in the registered user profile
interest-related data and behavioural data A relatively new feature of targeting is the use of
custom audiences by targeting clients in the companyrsquos database on OSM platforms by
matching contact information Another example is the creation of lookalike audiences which
allows the targeting of new users who have similar characteristics as a specified group of
individuals Additionally it is also possible to target users who have visited a particular website
outside of the OSM platform Hence targeting through OSM platforms can be based on very
specific individual properties and behaviour
Because the targeting options are extensive advertisers sometimes chose to cooperate with
intermediaries Traders value intermediaries because of their expertise in both marketing
strategies and platform functionalities Intermediaries are therefore primarily used when
setting up a campaign that is complex in terms of targeting format or content Furthermore
intermediaries may also handle the creation of content and communication through OSM on
behalf of the client Finally certain intermediaries offer software facilitating social media
advertising and evaluating campaign effectiveness These additional features are made
possible because the intermediaries make use of the platformsrsquo API (application programming
interface) to provide data These additional statistics tap into the need for better metrics The
interviewed advertisers indicated that the statistics provided by the social media platforms are
not always adequate Even though the data are detailed the B2B clients and intermediaries
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indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
EUROPEAN COMMISSION
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In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
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10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
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Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
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102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
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the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 24 EN
Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 9 EN
Moreover it also forbids lsquoclickbaitrsquo and images that contain over 20 percent of text Google
(YouTube) is quite strict in terms of regulating nudity in videos and LinkedIn also performs
automated checks on advertisements (eg the platforms restricts the use of capitalised
words) Overall the stakeholders have the impression that the rules on advertising in online
social media are quite strict A local intermediary adds that the rules have become more
restrictive over time in the beginning almost everything could have been posted online
whereas now it is more limited the intermediary reports
In practice when submitting an advertisement on Facebook it is checked through an
automated process Within 10 minutes the advertiser is notified whether the ad was
approved or rejected In case the advertiser disagrees with a rejection he or she can send
feedback after which someone will check the concerned advertisement Despite this automated
check the intermediaries and B2B clients indicate that Facebook cannot possibly check every
aspect of an ad as the volume is very high There is however a second mechanism through
which users can report problematic advertisements after they are published Ads on Facebook
feature reporting buttons and other means for all users to provide feedback A B2B client
explains that Facebook bases the price of a campaign on how successful it is (ie the number
of times it is liked by users) and to what extent it receives negative user reports If
advertisements are unsuccessful or frequently reported by users Facebook will increase the
price for the advertiser or ask the advertiser to make changes to the advertisement (in terms
of content pictures or wording) to increase its attractiveness It is furthermore reported that
negative user feedback can lead to the shutdown of campaigns
42 Format and functionalities
In terms of formats and functionalities social media are constantly innovating and
creating new marketing possibilities These new options are promoted towards
advertisers for instance by providing online trainings about the new features informing
advertisers through sales people or offering price incentives Through these methods for
instance Facebook has promoted video as an advertising format in order to compete with other
platforms most notably YouTube
The social media providers are balancing their need to offer new options and the trust of their
platform users For this purpose there are certain limitations to the formats For instance
when content is sponsored Facebook adds a label to the ad Users can also typically report an
advertisement when they think the format or contents are inappropriate (see also ldquoApproval of
contentrdquo)
In terms of functionality social media providers offer information about which users are
targeted These data are always anonymous as a global intermediary indicates
ldquoWe only get information about masses of people The only reason why we get this
kind of information is to make our message more relevant for peoplerdquo
Even though the provided metrics are very detailed (indicating language age
location ethnicity interests etcetera) they are only visible for segments of 1000 to
2000 users From the perspective of intermediaries and B2B clients this renders the metrics
somewhat unsatisfying A B2B client notes that if metrics were more granular it would be
easier to target the right users making them more satisfied An academic concurs that the
metrics are relatively high-level and suggests that OSM providers could give more information
about the number of individuals actually targeted compared to the desired target size On the
YouTube metrics a local intermediary remarks that they are poorly organised and highlight
mainly the number of ldquoclicksrdquo whereas not all clicks will bring the user to the advertisers
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 10 EN
website As an experienced user in advertising the intermediary adds one can create custom
reports and custom setting on YouTube resulting in metrics that are more useful
43 Targeting
The intermediaries and B2B clients indicate that the OSM providers have an important role in
providing targeting possibilities They offer the underlying data deliver the targeting options
design the settings and provide statistics The interviewees indicate that they receive
automated suggestions through the online interfaces for entering target groups All
the major social media providers (Facebook Google Twitter) offer this type of advice For
instance when an advertiser selects a keyword for targeting in Twitter the online interface will
suggest related keywords The possibilities are also extensive allowing to select specific target
groups A critique however is that the advertisers cannot verify whether the right profiles are
selected for a certain target group and if the right individuals have been reached In this regard
they have to trust the platform owners
Three types of information are used for targeting profile information (the demographic
and other data that users provide) interest-related data (based on for instance likes and
group membership) and behavioural data (based on what users do ie their location
browsing behaviour etcetera) Facebook is indicated to be most advanced in terms of the
offered targeting options as this platform has most data on its users The targeting can be
based on liked brands or pages watched picturesvideos activity on webpages outside
Facebook device location etcetera Furthermore YouTube is also mentioned as a well-
developed platform for targeting advertisements In addition certain platforms are
preferred to target broad groups of individuals For example Snapchat is well suited to
reach younger people whereas Instagram is more appropriate for targeting women Several
new targeting methods have been developed recently which will be discussed in more detail
in the following section
5 New functionalities
51 Identified trends
Social media offer many new possibilities in terms of commercial practices Firstly targeting
is a prime area for which new functionalities were identified In general the interviewees note
that targeting is becoming increasingly more sophisticated and efficient Two specific features
of Facebook were often named custom audiences and lookalike audiences The former
implies that companies use their client database (eg a CRM database containing e-mail
addresses or phone numbers) to specifically target the individuals in this database The
latter lookalike audiences is a functionality that allows targeting new users who have
similar characteristics as a specified group of individuals Performance metrics on these
targets could possibly be much more detailed down to the level of the individual but Facebook
does not allow metrics on custom audiences of fewer than 1000 individuals2
2 The Facebook Advertiser Help Center mentions this limitation with regard to metrics (Audience
Insights) on custom audiences httpswwwfacebookcombusinesshelp580994405331939
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 11 EN
Other novel types of targeting that were mentioned include remarketing (advertising based on
a usersrsquo visit of websites outside the OSM platform) and the linking of data from different
platforms An example of database linking includes the use of Facebook data to target users
on Instagram or the linking of Facebook and WhatsApp data
Additionally new functionalities in terms of formats were discussed The B2B clients and
intermediaries identified an increase in integration of content and advertising For
example commercial messages are more often being shown inside content space and
advertisement labelling has sometimes become less conspicuous Formats also
increasingly focus on keeping users on the social media platform instead of redirecting
them to other websites An example is the canvas advertisement on Facebook which is
essentially a small web page that users can navigate while staying on the Facebook platform
Furthermore video content is seen as an increasingly important format A global intermediary
confirms that videos are better received by consumers and yield better results compared to
traditional advertisements Finally important new indirect ways of advertising were identified
such as promoting brands through social influencers or having lsquonormalrsquo users promote
brands (eg by offering sponsored lenses (or lsquoframesrsquo) which individuals can apply to their
Snapchat pictures)
New functionalities were also observed with regard to metrics and statistics Firstly
advertisers can increasingly link their online advertisements to purchases A local
intermediary explains that when an item is promoted on multiple OSM platforms the
advertiser can determine from which platform the buyer arrived at the sellerrsquos website Second
new software can generate statistics that go beyond the overviews offered by the social media
platforms This software is provided to advertisers and intermediaries and collects the data
through the APIs of the social media platforms (eg Facebook and Twitter) One of the
interviewed intermediaries creates software that enables advertisers to assess which ads work
best with what audiences Another type of technology referred to by a global intermediary
measures what types of emotions are expressed through comments on commercial messages
Overall the advanced analysis by intermediaries of large amounts of raw data provided by
social media platforms is considered as an important new functionality
52 Potential problems and benefits for consumers
With the extensive options in terms of targeting and data usage privacy was often discussed
as a main concern More specifically critique was expressed on the use of client databases for
targeting on social media A local intermediary remarks that not all individuals in a company
database may have opted-in for targeting through social media Consumers may not be fully
aware that contact information collected ldquoofflinerdquo may be used for commercial
practices on social media As an academic notes this can be potentially worrisome
ldquoWhen I gave my phone number e-mail address or physical address I wouldnrsquot expect
those businesses to be able to track me on Facebook and target me with ads but now
they can That is a troubling new functionalityrdquo
Furthermore the practice of remarketing can be perceived as problematic in some cases A
local intermediary argues that retargeting may not be desirable for all products and users may
not wish their purchases (or purchase intentions) to be displayed on-screen Finally in addition
to being perceived as lsquospookyrsquo or lsquoscaryrsquo sophisticated targeting can be problematic when
different individuals are shown different offers (price discrimination) or when certain individuals
are excluded from offers With regard to the latter a consumer organisation identified a
particular risk in insurance companies that chose to advertise only to low-risk individuals (for
instance by targeting users based on their educational level) In terms of formats
commercial messages that look like regular content have the potential to mislead
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 12 EN
consumers Two advertisers organisations name this practice as particularly
problematic In their view consumers should not be misled by an ad that looks like editorial
content As one organisation adds it is especially problematic when such an advertisement
reaches young people who may not possess the background knowledge to discern ads from
editorial content Moreover it is problematic when advertisements are integrated into the social
interaction among users It can be perceived as highly intrusive to see an advertisement
between the Snapchat stories of friends or among private messages on Facebook In addition
to the aforementioned downsides certain benefits of more advanced targeting and data usage
were put forward by a broad range of interviewed actors The displayed advertisements are
more interesting and relevant for the social media users Because the content is more relevant
individuals will be less inclined to feel bothered by hem and instead appreciate the commercial
practices For the same reason the targeted messages may add value for consumers rather
than cause annoyance As a global intermediary summarises
ldquoIn a world where we get so many messages its [about] being relevant [in] what you
say being relevant about the type of product for a certain type of peoplerdquo
6 Misleading practices and remedies
61 Types of misleading practices
The interviewed representatives of B2B clients and Intermediaries indicate that they witnessed
only few instances of clearly misleading practices on the large social media They argue that
social media aim to avoid such misleading advertisements as they do not wish to upset users
Since advertising is a crucial element in their business model social media are very careful
about which advertising they show When prompted however the interviewed B2B clients and
Intermediaries were able to provide examples of misleading problematic and unfair commercial
practices Additional information is provided by consumer organisations and academics who
played particular attention to user data collected by social media They also referred to cases
of malware phishing and misleading promotions The types of misleading commercial practices
that are reported can be classified under the following five categories
Disguised marketing
First an often-mentioned problem is the difficulty to recognise advertising on social media
In part the difficulty to identify ads is related to their format For example on Facebook the
difference between sponsored content and user content is very subtle On Twitter as well it is
difficult to know if content is paid for when browsing hashtags A B2B client suggests that social
media purposefully integrate advertising and content
ldquoOn Facebook it is signalled when content is sponsored but it is not very
obvious and this is on purpose because Facebook does not want to show so
clearly that it is an ad
Furthermore commercial practices are sometimes difficult to recognise because the
commercial nature is not disclosed For example the presence of product placement may not
always be clearly labelled or indicated A specific case in this regard are social influencers
Celebrities or individuals who are popular on social media may be paid by brands to mention
or promote their products When they do not disclose being paid this can be misleading
towards consumers The latter problem is mentioned by several intermediaries and an
advertising self-regulatory body The advertisersrsquo organisation indicates that social influencers
are posting sponsored messages on social media but that they are not necessarily following
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 13 EN
the rules set out by self-regulatory bodies (ICC) and by the European Commission (UCPD) It
is argued that such failures may be due to inexperience and lack of familiarity with the existing
rules rather than a conscious intent not to adhere to them
Misleading marketing content
A second type of problematic commercial practice concerns misleading or incorrect product
or price descriptions This includes advertising with misleading information about the price
of a product (eg claiming something is free when it is not) the qualities of the product or
incorrectly claiming that an offer is limited in time This type of misinformation also includes
social media campaigns that are referring to a promotion which is no longer valid
Intermediaries and B2B clients further mentioned that product endorsements by social media
users may not always be fully genuine as they could be part of a lsquoshare and winrsquo or lsquolike and
winrsquo action
Undesirable or improper user targeting
Undesirable or improper user targeting is a third important problematic commercial practice
Several B2B clients and intermediaries mention that many users are unaware of how they are
being tracked and how this affects the advertisements that they see The fact that advertising
is personalised and targeted at specific groups without the users being fully knowledgeable
about it is perceived as problematic by an interviewed academic For example many social
media users may not be aware of any behavioural tracking that occurs (eg platforms tracking
the usersrsquo activities on their website and on many other websites that users visit) It implies
that users may not have been sufficiently informed to give consent to this type of tracking
Furthermore brands can advertise to users who have never lsquolikedrsquo the brandrsquos page or have
no interest in the brand at all (for instance by inserting advertisements on their Facebook News
Feed) A B2B client explains that this practice can make users angry based on individual
comments on the companyrsquos Facebook posts and private messages received through Facebook
Targeting can also fail when it is based on inaccurate information or wrong assumptions Users
may for instance be targeted with products they have already bought
Processing of private data
Fourthly participants in the stakeholder survey indicate that it is problematic when very
private data is not processed transparently Social media collect many different types of
information about their users including profile data activities on the platform real-world
location et cetera How these data are used however is not entirely clear to users The B2B
clients and consumer organisations expressed concern about what data is stored how safe it
is stored and whom it is shared with A consumer organisation mentioned that online social
media do not limit the storage of data in time ie it is stored indefinitely The same
organisation also points out a problematic example of a mobile phone banking app which sends
information to Facebook without notifying its users With WhatsApp being part of Facebook a
local intermediary finds it increasingly unclear which information shared with others is still
private and which can also be used for commercial purposes
Aggressive or criminal practices
A final type of problematic commercial practices concern cases of aggressive or criminal
practices Although the stakeholders indicated that criminal practices are not widespread on
social media they did refer to scams phishing and other illegal activities One particular
example provided by a global intermediary concerns a fake airline profile on social media
which promised that a user can win euro3000 by sharing a message These profile pages receive
EUROPEAN COMMISSION
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2018 EUR 14 EN
a high amount of visitors and can afterwards be sold on the black market Other cases
mentioned in two B2B interviews are about lsquoaggressiversquo advertisements and aggressive phone
calls after entering contact details on social media
62 Remedies
Various remedies are suggested to counter the aforementioned misleading unfair or
problematic practices The stakeholders interviewed see a role for advertisers social media
users platform owners and governments Intermediaries and B2B clients recognise their role
as advertisers to engage in fair commercial practices that are relevant for consumers In
addition these actors also point out the responsibilities of social media users The latter have
the ability to shape their online advertising environment by indicating which advertisements
they like or do not like As a global intermediary summarises it
ldquoId rather see something that I like or might like instead of tampon commercials So
you yourself [as a user] can make that ad environment just better and more personal
So why wouldnrsquot yourdquo
Furthermore users can report the ads that they find problematic through the automated
reporting on social media The interviewed intermediaries and B2B clients strongly encourage
this
Nevertheless social media providers also have a role in this process Certain B2B clients
and intermediary stakeholders indicate that it is unclear how complaints and reports are
handled Social media providers could be more lsquohands-onrsquo in dealing with user complaints and
when approving advertising Even though the platform owners do not have the capacity to
manually check every advertisement the interviewed advertisers stress the importance of
having a human being (in addition to a computer system) estimate which practices are
acceptable and which are not Furthermore a self-regulatory advertising body proposes that
social media immediately take down advertisements when the self-regulatory body has decided
that they are not acceptable
From the interviews with the different types of stakeholders three key steps to be taken by
social media providers emerged (1) simplify their terms and conditions as well as privacy
policy and present these terms to users in a clear and understandable way (2) label advertising
more prominently and ensure that the same wordingformatting is used throughout the entire
platform and (3) offer more options as opt-in features rather than opt-out With regard to the
first aspect a consumer organisation argues that If the terms of services are not available
and not understandable then its impossible to get an actual consent from the consumer
Finally certain participants in the survey identified a role for governments An intermediary
and consumer organisation suggest that governments (eg on a European level) should
monitor commercial practices performed on online social media and track new technologies
that could potentially violate consumer rights In terms of the current commercial practices on
social media the interviewees from different stakeholder categories identified the need for
laws on privacy and data protection to be adapted to the current practices on social
media Finally legislation is requested to ensure that social influencers are required to
disclose when they are being paid for certain messages With regard to the latter a global
intermediary adds the following
ldquoJust like we have to do on TV and say there is product placement in the TV
show you should be obliged to do it on your social mediardquo
7 Issues and complaints
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 15 EN
71 Consumers
Consumers have different means of complaining about problematic commercial practices on
social media The most common channel to voice complaints is through the social media
platforms themselves On Facebook users may for instance click negative emoticons post
comments or report the advertisement Less commonly private messages can also be sent
to advertisers Depending on the situation either social media providers deal with a complaint
(eg for complaints expressed through the reporting tool) or the advertiser handles it (eg
for complaints communicated through comments or private messages) Consumers almost
never address their complaints to intermediaries because for social media users it is not visible
which intermediaries are behind a campaign Intermediaries may deal with user complaints in
the name of their end clients or they may forward the complaints to their clients Certain
intermediaries are not at all involved in dealing with user complaints for example
intermediaries which offer software for metrics Some actors use a very structured approach
in answering user feedback One of the interviewed B2B clients makes use of a flow chart to
identify which actions to take in case of user positive neutral or negative consumer response
on social media
The interviewed B2B clients intermediaries and consumer organisations primarily identified
user complains concerning the high number of advertisements (lsquospammingrsquo or lsquopolluting their
contentrsquo) the targeting of commercial practices (mistargeting showing irrelevant ads or re-
targeting advertisement) and the difficulty to identify advertising and discern it from other
content With regard to the latter an advertising self-regulating body reports an
increase in the complaints about social influencers who do not clearly identify which
of their activities are sponsored
72 B2B clients
The issues and complaints that advertisers have are related to the social media platforms
Nevertheless the number of complaints is very limited When issues do arise they are
sometimes related to the platform disapproving an advertiserrsquos campaign without a clear
reason the complexity of the options when advertising on social media and the difficulty of
working with the platformrsquos API (Application Programming Interface)
8 Actions by enforcement authorities
Involvement of enforcement authorities was not a common action when dealing with
problematic commercial practices An important explanation for this is that ndash as multiple
stakeholders indicated ndash going to court takes time It is far more likely that a consumer
complaint is resolved by the advertising company or that a self-regulatory body is involved
The German advertising self-regulator pointed out that their process is much faster than a
court procedure However when the regulator lacks resources or when the complaint deals
with criminal activities the issue is taken to the enforcement authorities
When enforcement authorities are involved it usually concerns the most serious complaints
Examples mentioned by the interviewees include cases about criminal activities (Germany)
alcohol advertising (Poland) data collection (Italy) and out-of-stock products (Belgium) In
many of the cases mentioned in the interviews the government was involved by filing a
complaint against certain commercial practices
Whereas investigations against social influencers are not common in Europe the United States
enforce a more extensive legislation on this topic A respondent from a global intermediary was
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 16 EN
aware of a case in the United States where the legal authorities had fined YouTube influencers
for not disclosing sponsorship
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 17 EN
9 Conclusions
The stakeholder survey is part of subtask 14 which aimed to investigate marketing practices
on online social media from a traderrsquos point of view The survey consisted of 50 in-depth
interviews of stakeholders belonging to relevant subgroups with different perspectives and
explored the roles and responsibilities of OSM providers and other actors in the commercial
practices on their platforms More specifically the stakeholder survey aimed to acquire
information about which commercial practices can be found on social media and in what way
certain practices may be misleading unfair or problematic for consumers Additionally the
views of the different stakeholders were assessed and compared as well as their role in the
commercial practices
Types of commercial practices on social media
The stakeholders interviewed differentiate two broad types of activities
- Posting lsquoorganicallyrsquo publishing interesting content without paying for it
- Performing lsquomarketingrsquo engaging in payed-for commercial practices
Additional practices emerged during the interviews including paying social influencers for
promoting products or services managing the social media pages or communities of brands
and analysing what is being said about brands on social media These services can be offered
by local or global intermediaries or by individual social influencers
91 Novel commercial practices on social media
Throughout the stakeholder interviews different functionalities and targeting methods on social
media were discussed The four largest OSM platforms covered in the majority of the
interviews offer extensive possibilities for engaging in commercial practices To compete with
other platforms the major social media are also continuously creating new possibilities for
advertisers and traders which they promote through sales persons and tutorials
Among these new functionalities are extensive options for targeting advertisements The main
OSM platforms allow targeting based on information contained in the registered user profile
interest-related data and behavioural data A relatively new feature of targeting is the use of
custom audiences by targeting clients in the companyrsquos database on OSM platforms by
matching contact information Another example is the creation of lookalike audiences which
allows the targeting of new users who have similar characteristics as a specified group of
individuals Additionally it is also possible to target users who have visited a particular website
outside of the OSM platform Hence targeting through OSM platforms can be based on very
specific individual properties and behaviour
Because the targeting options are extensive advertisers sometimes chose to cooperate with
intermediaries Traders value intermediaries because of their expertise in both marketing
strategies and platform functionalities Intermediaries are therefore primarily used when
setting up a campaign that is complex in terms of targeting format or content Furthermore
intermediaries may also handle the creation of content and communication through OSM on
behalf of the client Finally certain intermediaries offer software facilitating social media
advertising and evaluating campaign effectiveness These additional features are made
possible because the intermediaries make use of the platformsrsquo API (application programming
interface) to provide data These additional statistics tap into the need for better metrics The
interviewed advertisers indicated that the statistics provided by the social media platforms are
not always adequate Even though the data are detailed the B2B clients and intermediaries
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 18 EN
indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
EUROPEAN COMMISSION
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2018 EUR 19 EN
In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 20 EN
10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 21 EN
Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
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2018 EUR 22 EN
102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
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Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
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2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
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Free publications
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via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
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website As an experienced user in advertising the intermediary adds one can create custom
reports and custom setting on YouTube resulting in metrics that are more useful
43 Targeting
The intermediaries and B2B clients indicate that the OSM providers have an important role in
providing targeting possibilities They offer the underlying data deliver the targeting options
design the settings and provide statistics The interviewees indicate that they receive
automated suggestions through the online interfaces for entering target groups All
the major social media providers (Facebook Google Twitter) offer this type of advice For
instance when an advertiser selects a keyword for targeting in Twitter the online interface will
suggest related keywords The possibilities are also extensive allowing to select specific target
groups A critique however is that the advertisers cannot verify whether the right profiles are
selected for a certain target group and if the right individuals have been reached In this regard
they have to trust the platform owners
Three types of information are used for targeting profile information (the demographic
and other data that users provide) interest-related data (based on for instance likes and
group membership) and behavioural data (based on what users do ie their location
browsing behaviour etcetera) Facebook is indicated to be most advanced in terms of the
offered targeting options as this platform has most data on its users The targeting can be
based on liked brands or pages watched picturesvideos activity on webpages outside
Facebook device location etcetera Furthermore YouTube is also mentioned as a well-
developed platform for targeting advertisements In addition certain platforms are
preferred to target broad groups of individuals For example Snapchat is well suited to
reach younger people whereas Instagram is more appropriate for targeting women Several
new targeting methods have been developed recently which will be discussed in more detail
in the following section
5 New functionalities
51 Identified trends
Social media offer many new possibilities in terms of commercial practices Firstly targeting
is a prime area for which new functionalities were identified In general the interviewees note
that targeting is becoming increasingly more sophisticated and efficient Two specific features
of Facebook were often named custom audiences and lookalike audiences The former
implies that companies use their client database (eg a CRM database containing e-mail
addresses or phone numbers) to specifically target the individuals in this database The
latter lookalike audiences is a functionality that allows targeting new users who have
similar characteristics as a specified group of individuals Performance metrics on these
targets could possibly be much more detailed down to the level of the individual but Facebook
does not allow metrics on custom audiences of fewer than 1000 individuals2
2 The Facebook Advertiser Help Center mentions this limitation with regard to metrics (Audience
Insights) on custom audiences httpswwwfacebookcombusinesshelp580994405331939
EUROPEAN COMMISSION
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2018 EUR 11 EN
Other novel types of targeting that were mentioned include remarketing (advertising based on
a usersrsquo visit of websites outside the OSM platform) and the linking of data from different
platforms An example of database linking includes the use of Facebook data to target users
on Instagram or the linking of Facebook and WhatsApp data
Additionally new functionalities in terms of formats were discussed The B2B clients and
intermediaries identified an increase in integration of content and advertising For
example commercial messages are more often being shown inside content space and
advertisement labelling has sometimes become less conspicuous Formats also
increasingly focus on keeping users on the social media platform instead of redirecting
them to other websites An example is the canvas advertisement on Facebook which is
essentially a small web page that users can navigate while staying on the Facebook platform
Furthermore video content is seen as an increasingly important format A global intermediary
confirms that videos are better received by consumers and yield better results compared to
traditional advertisements Finally important new indirect ways of advertising were identified
such as promoting brands through social influencers or having lsquonormalrsquo users promote
brands (eg by offering sponsored lenses (or lsquoframesrsquo) which individuals can apply to their
Snapchat pictures)
New functionalities were also observed with regard to metrics and statistics Firstly
advertisers can increasingly link their online advertisements to purchases A local
intermediary explains that when an item is promoted on multiple OSM platforms the
advertiser can determine from which platform the buyer arrived at the sellerrsquos website Second
new software can generate statistics that go beyond the overviews offered by the social media
platforms This software is provided to advertisers and intermediaries and collects the data
through the APIs of the social media platforms (eg Facebook and Twitter) One of the
interviewed intermediaries creates software that enables advertisers to assess which ads work
best with what audiences Another type of technology referred to by a global intermediary
measures what types of emotions are expressed through comments on commercial messages
Overall the advanced analysis by intermediaries of large amounts of raw data provided by
social media platforms is considered as an important new functionality
52 Potential problems and benefits for consumers
With the extensive options in terms of targeting and data usage privacy was often discussed
as a main concern More specifically critique was expressed on the use of client databases for
targeting on social media A local intermediary remarks that not all individuals in a company
database may have opted-in for targeting through social media Consumers may not be fully
aware that contact information collected ldquoofflinerdquo may be used for commercial
practices on social media As an academic notes this can be potentially worrisome
ldquoWhen I gave my phone number e-mail address or physical address I wouldnrsquot expect
those businesses to be able to track me on Facebook and target me with ads but now
they can That is a troubling new functionalityrdquo
Furthermore the practice of remarketing can be perceived as problematic in some cases A
local intermediary argues that retargeting may not be desirable for all products and users may
not wish their purchases (or purchase intentions) to be displayed on-screen Finally in addition
to being perceived as lsquospookyrsquo or lsquoscaryrsquo sophisticated targeting can be problematic when
different individuals are shown different offers (price discrimination) or when certain individuals
are excluded from offers With regard to the latter a consumer organisation identified a
particular risk in insurance companies that chose to advertise only to low-risk individuals (for
instance by targeting users based on their educational level) In terms of formats
commercial messages that look like regular content have the potential to mislead
EUROPEAN COMMISSION
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2018 EUR 12 EN
consumers Two advertisers organisations name this practice as particularly
problematic In their view consumers should not be misled by an ad that looks like editorial
content As one organisation adds it is especially problematic when such an advertisement
reaches young people who may not possess the background knowledge to discern ads from
editorial content Moreover it is problematic when advertisements are integrated into the social
interaction among users It can be perceived as highly intrusive to see an advertisement
between the Snapchat stories of friends or among private messages on Facebook In addition
to the aforementioned downsides certain benefits of more advanced targeting and data usage
were put forward by a broad range of interviewed actors The displayed advertisements are
more interesting and relevant for the social media users Because the content is more relevant
individuals will be less inclined to feel bothered by hem and instead appreciate the commercial
practices For the same reason the targeted messages may add value for consumers rather
than cause annoyance As a global intermediary summarises
ldquoIn a world where we get so many messages its [about] being relevant [in] what you
say being relevant about the type of product for a certain type of peoplerdquo
6 Misleading practices and remedies
61 Types of misleading practices
The interviewed representatives of B2B clients and Intermediaries indicate that they witnessed
only few instances of clearly misleading practices on the large social media They argue that
social media aim to avoid such misleading advertisements as they do not wish to upset users
Since advertising is a crucial element in their business model social media are very careful
about which advertising they show When prompted however the interviewed B2B clients and
Intermediaries were able to provide examples of misleading problematic and unfair commercial
practices Additional information is provided by consumer organisations and academics who
played particular attention to user data collected by social media They also referred to cases
of malware phishing and misleading promotions The types of misleading commercial practices
that are reported can be classified under the following five categories
Disguised marketing
First an often-mentioned problem is the difficulty to recognise advertising on social media
In part the difficulty to identify ads is related to their format For example on Facebook the
difference between sponsored content and user content is very subtle On Twitter as well it is
difficult to know if content is paid for when browsing hashtags A B2B client suggests that social
media purposefully integrate advertising and content
ldquoOn Facebook it is signalled when content is sponsored but it is not very
obvious and this is on purpose because Facebook does not want to show so
clearly that it is an ad
Furthermore commercial practices are sometimes difficult to recognise because the
commercial nature is not disclosed For example the presence of product placement may not
always be clearly labelled or indicated A specific case in this regard are social influencers
Celebrities or individuals who are popular on social media may be paid by brands to mention
or promote their products When they do not disclose being paid this can be misleading
towards consumers The latter problem is mentioned by several intermediaries and an
advertising self-regulatory body The advertisersrsquo organisation indicates that social influencers
are posting sponsored messages on social media but that they are not necessarily following
EUROPEAN COMMISSION
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2018 EUR 13 EN
the rules set out by self-regulatory bodies (ICC) and by the European Commission (UCPD) It
is argued that such failures may be due to inexperience and lack of familiarity with the existing
rules rather than a conscious intent not to adhere to them
Misleading marketing content
A second type of problematic commercial practice concerns misleading or incorrect product
or price descriptions This includes advertising with misleading information about the price
of a product (eg claiming something is free when it is not) the qualities of the product or
incorrectly claiming that an offer is limited in time This type of misinformation also includes
social media campaigns that are referring to a promotion which is no longer valid
Intermediaries and B2B clients further mentioned that product endorsements by social media
users may not always be fully genuine as they could be part of a lsquoshare and winrsquo or lsquolike and
winrsquo action
Undesirable or improper user targeting
Undesirable or improper user targeting is a third important problematic commercial practice
Several B2B clients and intermediaries mention that many users are unaware of how they are
being tracked and how this affects the advertisements that they see The fact that advertising
is personalised and targeted at specific groups without the users being fully knowledgeable
about it is perceived as problematic by an interviewed academic For example many social
media users may not be aware of any behavioural tracking that occurs (eg platforms tracking
the usersrsquo activities on their website and on many other websites that users visit) It implies
that users may not have been sufficiently informed to give consent to this type of tracking
Furthermore brands can advertise to users who have never lsquolikedrsquo the brandrsquos page or have
no interest in the brand at all (for instance by inserting advertisements on their Facebook News
Feed) A B2B client explains that this practice can make users angry based on individual
comments on the companyrsquos Facebook posts and private messages received through Facebook
Targeting can also fail when it is based on inaccurate information or wrong assumptions Users
may for instance be targeted with products they have already bought
Processing of private data
Fourthly participants in the stakeholder survey indicate that it is problematic when very
private data is not processed transparently Social media collect many different types of
information about their users including profile data activities on the platform real-world
location et cetera How these data are used however is not entirely clear to users The B2B
clients and consumer organisations expressed concern about what data is stored how safe it
is stored and whom it is shared with A consumer organisation mentioned that online social
media do not limit the storage of data in time ie it is stored indefinitely The same
organisation also points out a problematic example of a mobile phone banking app which sends
information to Facebook without notifying its users With WhatsApp being part of Facebook a
local intermediary finds it increasingly unclear which information shared with others is still
private and which can also be used for commercial purposes
Aggressive or criminal practices
A final type of problematic commercial practices concern cases of aggressive or criminal
practices Although the stakeholders indicated that criminal practices are not widespread on
social media they did refer to scams phishing and other illegal activities One particular
example provided by a global intermediary concerns a fake airline profile on social media
which promised that a user can win euro3000 by sharing a message These profile pages receive
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 14 EN
a high amount of visitors and can afterwards be sold on the black market Other cases
mentioned in two B2B interviews are about lsquoaggressiversquo advertisements and aggressive phone
calls after entering contact details on social media
62 Remedies
Various remedies are suggested to counter the aforementioned misleading unfair or
problematic practices The stakeholders interviewed see a role for advertisers social media
users platform owners and governments Intermediaries and B2B clients recognise their role
as advertisers to engage in fair commercial practices that are relevant for consumers In
addition these actors also point out the responsibilities of social media users The latter have
the ability to shape their online advertising environment by indicating which advertisements
they like or do not like As a global intermediary summarises it
ldquoId rather see something that I like or might like instead of tampon commercials So
you yourself [as a user] can make that ad environment just better and more personal
So why wouldnrsquot yourdquo
Furthermore users can report the ads that they find problematic through the automated
reporting on social media The interviewed intermediaries and B2B clients strongly encourage
this
Nevertheless social media providers also have a role in this process Certain B2B clients
and intermediary stakeholders indicate that it is unclear how complaints and reports are
handled Social media providers could be more lsquohands-onrsquo in dealing with user complaints and
when approving advertising Even though the platform owners do not have the capacity to
manually check every advertisement the interviewed advertisers stress the importance of
having a human being (in addition to a computer system) estimate which practices are
acceptable and which are not Furthermore a self-regulatory advertising body proposes that
social media immediately take down advertisements when the self-regulatory body has decided
that they are not acceptable
From the interviews with the different types of stakeholders three key steps to be taken by
social media providers emerged (1) simplify their terms and conditions as well as privacy
policy and present these terms to users in a clear and understandable way (2) label advertising
more prominently and ensure that the same wordingformatting is used throughout the entire
platform and (3) offer more options as opt-in features rather than opt-out With regard to the
first aspect a consumer organisation argues that If the terms of services are not available
and not understandable then its impossible to get an actual consent from the consumer
Finally certain participants in the survey identified a role for governments An intermediary
and consumer organisation suggest that governments (eg on a European level) should
monitor commercial practices performed on online social media and track new technologies
that could potentially violate consumer rights In terms of the current commercial practices on
social media the interviewees from different stakeholder categories identified the need for
laws on privacy and data protection to be adapted to the current practices on social
media Finally legislation is requested to ensure that social influencers are required to
disclose when they are being paid for certain messages With regard to the latter a global
intermediary adds the following
ldquoJust like we have to do on TV and say there is product placement in the TV
show you should be obliged to do it on your social mediardquo
7 Issues and complaints
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 15 EN
71 Consumers
Consumers have different means of complaining about problematic commercial practices on
social media The most common channel to voice complaints is through the social media
platforms themselves On Facebook users may for instance click negative emoticons post
comments or report the advertisement Less commonly private messages can also be sent
to advertisers Depending on the situation either social media providers deal with a complaint
(eg for complaints expressed through the reporting tool) or the advertiser handles it (eg
for complaints communicated through comments or private messages) Consumers almost
never address their complaints to intermediaries because for social media users it is not visible
which intermediaries are behind a campaign Intermediaries may deal with user complaints in
the name of their end clients or they may forward the complaints to their clients Certain
intermediaries are not at all involved in dealing with user complaints for example
intermediaries which offer software for metrics Some actors use a very structured approach
in answering user feedback One of the interviewed B2B clients makes use of a flow chart to
identify which actions to take in case of user positive neutral or negative consumer response
on social media
The interviewed B2B clients intermediaries and consumer organisations primarily identified
user complains concerning the high number of advertisements (lsquospammingrsquo or lsquopolluting their
contentrsquo) the targeting of commercial practices (mistargeting showing irrelevant ads or re-
targeting advertisement) and the difficulty to identify advertising and discern it from other
content With regard to the latter an advertising self-regulating body reports an
increase in the complaints about social influencers who do not clearly identify which
of their activities are sponsored
72 B2B clients
The issues and complaints that advertisers have are related to the social media platforms
Nevertheless the number of complaints is very limited When issues do arise they are
sometimes related to the platform disapproving an advertiserrsquos campaign without a clear
reason the complexity of the options when advertising on social media and the difficulty of
working with the platformrsquos API (Application Programming Interface)
8 Actions by enforcement authorities
Involvement of enforcement authorities was not a common action when dealing with
problematic commercial practices An important explanation for this is that ndash as multiple
stakeholders indicated ndash going to court takes time It is far more likely that a consumer
complaint is resolved by the advertising company or that a self-regulatory body is involved
The German advertising self-regulator pointed out that their process is much faster than a
court procedure However when the regulator lacks resources or when the complaint deals
with criminal activities the issue is taken to the enforcement authorities
When enforcement authorities are involved it usually concerns the most serious complaints
Examples mentioned by the interviewees include cases about criminal activities (Germany)
alcohol advertising (Poland) data collection (Italy) and out-of-stock products (Belgium) In
many of the cases mentioned in the interviews the government was involved by filing a
complaint against certain commercial practices
Whereas investigations against social influencers are not common in Europe the United States
enforce a more extensive legislation on this topic A respondent from a global intermediary was
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 16 EN
aware of a case in the United States where the legal authorities had fined YouTube influencers
for not disclosing sponsorship
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 17 EN
9 Conclusions
The stakeholder survey is part of subtask 14 which aimed to investigate marketing practices
on online social media from a traderrsquos point of view The survey consisted of 50 in-depth
interviews of stakeholders belonging to relevant subgroups with different perspectives and
explored the roles and responsibilities of OSM providers and other actors in the commercial
practices on their platforms More specifically the stakeholder survey aimed to acquire
information about which commercial practices can be found on social media and in what way
certain practices may be misleading unfair or problematic for consumers Additionally the
views of the different stakeholders were assessed and compared as well as their role in the
commercial practices
Types of commercial practices on social media
The stakeholders interviewed differentiate two broad types of activities
- Posting lsquoorganicallyrsquo publishing interesting content without paying for it
- Performing lsquomarketingrsquo engaging in payed-for commercial practices
Additional practices emerged during the interviews including paying social influencers for
promoting products or services managing the social media pages or communities of brands
and analysing what is being said about brands on social media These services can be offered
by local or global intermediaries or by individual social influencers
91 Novel commercial practices on social media
Throughout the stakeholder interviews different functionalities and targeting methods on social
media were discussed The four largest OSM platforms covered in the majority of the
interviews offer extensive possibilities for engaging in commercial practices To compete with
other platforms the major social media are also continuously creating new possibilities for
advertisers and traders which they promote through sales persons and tutorials
Among these new functionalities are extensive options for targeting advertisements The main
OSM platforms allow targeting based on information contained in the registered user profile
interest-related data and behavioural data A relatively new feature of targeting is the use of
custom audiences by targeting clients in the companyrsquos database on OSM platforms by
matching contact information Another example is the creation of lookalike audiences which
allows the targeting of new users who have similar characteristics as a specified group of
individuals Additionally it is also possible to target users who have visited a particular website
outside of the OSM platform Hence targeting through OSM platforms can be based on very
specific individual properties and behaviour
Because the targeting options are extensive advertisers sometimes chose to cooperate with
intermediaries Traders value intermediaries because of their expertise in both marketing
strategies and platform functionalities Intermediaries are therefore primarily used when
setting up a campaign that is complex in terms of targeting format or content Furthermore
intermediaries may also handle the creation of content and communication through OSM on
behalf of the client Finally certain intermediaries offer software facilitating social media
advertising and evaluating campaign effectiveness These additional features are made
possible because the intermediaries make use of the platformsrsquo API (application programming
interface) to provide data These additional statistics tap into the need for better metrics The
interviewed advertisers indicated that the statistics provided by the social media platforms are
not always adequate Even though the data are detailed the B2B clients and intermediaries
EUROPEAN COMMISSION
Directorate-General for Consumers
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indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
EUROPEAN COMMISSION
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In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 20 EN
10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
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Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
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102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
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the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
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Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
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2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
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2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
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from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
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Other novel types of targeting that were mentioned include remarketing (advertising based on
a usersrsquo visit of websites outside the OSM platform) and the linking of data from different
platforms An example of database linking includes the use of Facebook data to target users
on Instagram or the linking of Facebook and WhatsApp data
Additionally new functionalities in terms of formats were discussed The B2B clients and
intermediaries identified an increase in integration of content and advertising For
example commercial messages are more often being shown inside content space and
advertisement labelling has sometimes become less conspicuous Formats also
increasingly focus on keeping users on the social media platform instead of redirecting
them to other websites An example is the canvas advertisement on Facebook which is
essentially a small web page that users can navigate while staying on the Facebook platform
Furthermore video content is seen as an increasingly important format A global intermediary
confirms that videos are better received by consumers and yield better results compared to
traditional advertisements Finally important new indirect ways of advertising were identified
such as promoting brands through social influencers or having lsquonormalrsquo users promote
brands (eg by offering sponsored lenses (or lsquoframesrsquo) which individuals can apply to their
Snapchat pictures)
New functionalities were also observed with regard to metrics and statistics Firstly
advertisers can increasingly link their online advertisements to purchases A local
intermediary explains that when an item is promoted on multiple OSM platforms the
advertiser can determine from which platform the buyer arrived at the sellerrsquos website Second
new software can generate statistics that go beyond the overviews offered by the social media
platforms This software is provided to advertisers and intermediaries and collects the data
through the APIs of the social media platforms (eg Facebook and Twitter) One of the
interviewed intermediaries creates software that enables advertisers to assess which ads work
best with what audiences Another type of technology referred to by a global intermediary
measures what types of emotions are expressed through comments on commercial messages
Overall the advanced analysis by intermediaries of large amounts of raw data provided by
social media platforms is considered as an important new functionality
52 Potential problems and benefits for consumers
With the extensive options in terms of targeting and data usage privacy was often discussed
as a main concern More specifically critique was expressed on the use of client databases for
targeting on social media A local intermediary remarks that not all individuals in a company
database may have opted-in for targeting through social media Consumers may not be fully
aware that contact information collected ldquoofflinerdquo may be used for commercial
practices on social media As an academic notes this can be potentially worrisome
ldquoWhen I gave my phone number e-mail address or physical address I wouldnrsquot expect
those businesses to be able to track me on Facebook and target me with ads but now
they can That is a troubling new functionalityrdquo
Furthermore the practice of remarketing can be perceived as problematic in some cases A
local intermediary argues that retargeting may not be desirable for all products and users may
not wish their purchases (or purchase intentions) to be displayed on-screen Finally in addition
to being perceived as lsquospookyrsquo or lsquoscaryrsquo sophisticated targeting can be problematic when
different individuals are shown different offers (price discrimination) or when certain individuals
are excluded from offers With regard to the latter a consumer organisation identified a
particular risk in insurance companies that chose to advertise only to low-risk individuals (for
instance by targeting users based on their educational level) In terms of formats
commercial messages that look like regular content have the potential to mislead
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2018 EUR 12 EN
consumers Two advertisers organisations name this practice as particularly
problematic In their view consumers should not be misled by an ad that looks like editorial
content As one organisation adds it is especially problematic when such an advertisement
reaches young people who may not possess the background knowledge to discern ads from
editorial content Moreover it is problematic when advertisements are integrated into the social
interaction among users It can be perceived as highly intrusive to see an advertisement
between the Snapchat stories of friends or among private messages on Facebook In addition
to the aforementioned downsides certain benefits of more advanced targeting and data usage
were put forward by a broad range of interviewed actors The displayed advertisements are
more interesting and relevant for the social media users Because the content is more relevant
individuals will be less inclined to feel bothered by hem and instead appreciate the commercial
practices For the same reason the targeted messages may add value for consumers rather
than cause annoyance As a global intermediary summarises
ldquoIn a world where we get so many messages its [about] being relevant [in] what you
say being relevant about the type of product for a certain type of peoplerdquo
6 Misleading practices and remedies
61 Types of misleading practices
The interviewed representatives of B2B clients and Intermediaries indicate that they witnessed
only few instances of clearly misleading practices on the large social media They argue that
social media aim to avoid such misleading advertisements as they do not wish to upset users
Since advertising is a crucial element in their business model social media are very careful
about which advertising they show When prompted however the interviewed B2B clients and
Intermediaries were able to provide examples of misleading problematic and unfair commercial
practices Additional information is provided by consumer organisations and academics who
played particular attention to user data collected by social media They also referred to cases
of malware phishing and misleading promotions The types of misleading commercial practices
that are reported can be classified under the following five categories
Disguised marketing
First an often-mentioned problem is the difficulty to recognise advertising on social media
In part the difficulty to identify ads is related to their format For example on Facebook the
difference between sponsored content and user content is very subtle On Twitter as well it is
difficult to know if content is paid for when browsing hashtags A B2B client suggests that social
media purposefully integrate advertising and content
ldquoOn Facebook it is signalled when content is sponsored but it is not very
obvious and this is on purpose because Facebook does not want to show so
clearly that it is an ad
Furthermore commercial practices are sometimes difficult to recognise because the
commercial nature is not disclosed For example the presence of product placement may not
always be clearly labelled or indicated A specific case in this regard are social influencers
Celebrities or individuals who are popular on social media may be paid by brands to mention
or promote their products When they do not disclose being paid this can be misleading
towards consumers The latter problem is mentioned by several intermediaries and an
advertising self-regulatory body The advertisersrsquo organisation indicates that social influencers
are posting sponsored messages on social media but that they are not necessarily following
EUROPEAN COMMISSION
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2018 EUR 13 EN
the rules set out by self-regulatory bodies (ICC) and by the European Commission (UCPD) It
is argued that such failures may be due to inexperience and lack of familiarity with the existing
rules rather than a conscious intent not to adhere to them
Misleading marketing content
A second type of problematic commercial practice concerns misleading or incorrect product
or price descriptions This includes advertising with misleading information about the price
of a product (eg claiming something is free when it is not) the qualities of the product or
incorrectly claiming that an offer is limited in time This type of misinformation also includes
social media campaigns that are referring to a promotion which is no longer valid
Intermediaries and B2B clients further mentioned that product endorsements by social media
users may not always be fully genuine as they could be part of a lsquoshare and winrsquo or lsquolike and
winrsquo action
Undesirable or improper user targeting
Undesirable or improper user targeting is a third important problematic commercial practice
Several B2B clients and intermediaries mention that many users are unaware of how they are
being tracked and how this affects the advertisements that they see The fact that advertising
is personalised and targeted at specific groups without the users being fully knowledgeable
about it is perceived as problematic by an interviewed academic For example many social
media users may not be aware of any behavioural tracking that occurs (eg platforms tracking
the usersrsquo activities on their website and on many other websites that users visit) It implies
that users may not have been sufficiently informed to give consent to this type of tracking
Furthermore brands can advertise to users who have never lsquolikedrsquo the brandrsquos page or have
no interest in the brand at all (for instance by inserting advertisements on their Facebook News
Feed) A B2B client explains that this practice can make users angry based on individual
comments on the companyrsquos Facebook posts and private messages received through Facebook
Targeting can also fail when it is based on inaccurate information or wrong assumptions Users
may for instance be targeted with products they have already bought
Processing of private data
Fourthly participants in the stakeholder survey indicate that it is problematic when very
private data is not processed transparently Social media collect many different types of
information about their users including profile data activities on the platform real-world
location et cetera How these data are used however is not entirely clear to users The B2B
clients and consumer organisations expressed concern about what data is stored how safe it
is stored and whom it is shared with A consumer organisation mentioned that online social
media do not limit the storage of data in time ie it is stored indefinitely The same
organisation also points out a problematic example of a mobile phone banking app which sends
information to Facebook without notifying its users With WhatsApp being part of Facebook a
local intermediary finds it increasingly unclear which information shared with others is still
private and which can also be used for commercial purposes
Aggressive or criminal practices
A final type of problematic commercial practices concern cases of aggressive or criminal
practices Although the stakeholders indicated that criminal practices are not widespread on
social media they did refer to scams phishing and other illegal activities One particular
example provided by a global intermediary concerns a fake airline profile on social media
which promised that a user can win euro3000 by sharing a message These profile pages receive
EUROPEAN COMMISSION
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2018 EUR 14 EN
a high amount of visitors and can afterwards be sold on the black market Other cases
mentioned in two B2B interviews are about lsquoaggressiversquo advertisements and aggressive phone
calls after entering contact details on social media
62 Remedies
Various remedies are suggested to counter the aforementioned misleading unfair or
problematic practices The stakeholders interviewed see a role for advertisers social media
users platform owners and governments Intermediaries and B2B clients recognise their role
as advertisers to engage in fair commercial practices that are relevant for consumers In
addition these actors also point out the responsibilities of social media users The latter have
the ability to shape their online advertising environment by indicating which advertisements
they like or do not like As a global intermediary summarises it
ldquoId rather see something that I like or might like instead of tampon commercials So
you yourself [as a user] can make that ad environment just better and more personal
So why wouldnrsquot yourdquo
Furthermore users can report the ads that they find problematic through the automated
reporting on social media The interviewed intermediaries and B2B clients strongly encourage
this
Nevertheless social media providers also have a role in this process Certain B2B clients
and intermediary stakeholders indicate that it is unclear how complaints and reports are
handled Social media providers could be more lsquohands-onrsquo in dealing with user complaints and
when approving advertising Even though the platform owners do not have the capacity to
manually check every advertisement the interviewed advertisers stress the importance of
having a human being (in addition to a computer system) estimate which practices are
acceptable and which are not Furthermore a self-regulatory advertising body proposes that
social media immediately take down advertisements when the self-regulatory body has decided
that they are not acceptable
From the interviews with the different types of stakeholders three key steps to be taken by
social media providers emerged (1) simplify their terms and conditions as well as privacy
policy and present these terms to users in a clear and understandable way (2) label advertising
more prominently and ensure that the same wordingformatting is used throughout the entire
platform and (3) offer more options as opt-in features rather than opt-out With regard to the
first aspect a consumer organisation argues that If the terms of services are not available
and not understandable then its impossible to get an actual consent from the consumer
Finally certain participants in the survey identified a role for governments An intermediary
and consumer organisation suggest that governments (eg on a European level) should
monitor commercial practices performed on online social media and track new technologies
that could potentially violate consumer rights In terms of the current commercial practices on
social media the interviewees from different stakeholder categories identified the need for
laws on privacy and data protection to be adapted to the current practices on social
media Finally legislation is requested to ensure that social influencers are required to
disclose when they are being paid for certain messages With regard to the latter a global
intermediary adds the following
ldquoJust like we have to do on TV and say there is product placement in the TV
show you should be obliged to do it on your social mediardquo
7 Issues and complaints
EUROPEAN COMMISSION
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2018 EUR 15 EN
71 Consumers
Consumers have different means of complaining about problematic commercial practices on
social media The most common channel to voice complaints is through the social media
platforms themselves On Facebook users may for instance click negative emoticons post
comments or report the advertisement Less commonly private messages can also be sent
to advertisers Depending on the situation either social media providers deal with a complaint
(eg for complaints expressed through the reporting tool) or the advertiser handles it (eg
for complaints communicated through comments or private messages) Consumers almost
never address their complaints to intermediaries because for social media users it is not visible
which intermediaries are behind a campaign Intermediaries may deal with user complaints in
the name of their end clients or they may forward the complaints to their clients Certain
intermediaries are not at all involved in dealing with user complaints for example
intermediaries which offer software for metrics Some actors use a very structured approach
in answering user feedback One of the interviewed B2B clients makes use of a flow chart to
identify which actions to take in case of user positive neutral or negative consumer response
on social media
The interviewed B2B clients intermediaries and consumer organisations primarily identified
user complains concerning the high number of advertisements (lsquospammingrsquo or lsquopolluting their
contentrsquo) the targeting of commercial practices (mistargeting showing irrelevant ads or re-
targeting advertisement) and the difficulty to identify advertising and discern it from other
content With regard to the latter an advertising self-regulating body reports an
increase in the complaints about social influencers who do not clearly identify which
of their activities are sponsored
72 B2B clients
The issues and complaints that advertisers have are related to the social media platforms
Nevertheless the number of complaints is very limited When issues do arise they are
sometimes related to the platform disapproving an advertiserrsquos campaign without a clear
reason the complexity of the options when advertising on social media and the difficulty of
working with the platformrsquos API (Application Programming Interface)
8 Actions by enforcement authorities
Involvement of enforcement authorities was not a common action when dealing with
problematic commercial practices An important explanation for this is that ndash as multiple
stakeholders indicated ndash going to court takes time It is far more likely that a consumer
complaint is resolved by the advertising company or that a self-regulatory body is involved
The German advertising self-regulator pointed out that their process is much faster than a
court procedure However when the regulator lacks resources or when the complaint deals
with criminal activities the issue is taken to the enforcement authorities
When enforcement authorities are involved it usually concerns the most serious complaints
Examples mentioned by the interviewees include cases about criminal activities (Germany)
alcohol advertising (Poland) data collection (Italy) and out-of-stock products (Belgium) In
many of the cases mentioned in the interviews the government was involved by filing a
complaint against certain commercial practices
Whereas investigations against social influencers are not common in Europe the United States
enforce a more extensive legislation on this topic A respondent from a global intermediary was
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2018 EUR 16 EN
aware of a case in the United States where the legal authorities had fined YouTube influencers
for not disclosing sponsorship
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 17 EN
9 Conclusions
The stakeholder survey is part of subtask 14 which aimed to investigate marketing practices
on online social media from a traderrsquos point of view The survey consisted of 50 in-depth
interviews of stakeholders belonging to relevant subgroups with different perspectives and
explored the roles and responsibilities of OSM providers and other actors in the commercial
practices on their platforms More specifically the stakeholder survey aimed to acquire
information about which commercial practices can be found on social media and in what way
certain practices may be misleading unfair or problematic for consumers Additionally the
views of the different stakeholders were assessed and compared as well as their role in the
commercial practices
Types of commercial practices on social media
The stakeholders interviewed differentiate two broad types of activities
- Posting lsquoorganicallyrsquo publishing interesting content without paying for it
- Performing lsquomarketingrsquo engaging in payed-for commercial practices
Additional practices emerged during the interviews including paying social influencers for
promoting products or services managing the social media pages or communities of brands
and analysing what is being said about brands on social media These services can be offered
by local or global intermediaries or by individual social influencers
91 Novel commercial practices on social media
Throughout the stakeholder interviews different functionalities and targeting methods on social
media were discussed The four largest OSM platforms covered in the majority of the
interviews offer extensive possibilities for engaging in commercial practices To compete with
other platforms the major social media are also continuously creating new possibilities for
advertisers and traders which they promote through sales persons and tutorials
Among these new functionalities are extensive options for targeting advertisements The main
OSM platforms allow targeting based on information contained in the registered user profile
interest-related data and behavioural data A relatively new feature of targeting is the use of
custom audiences by targeting clients in the companyrsquos database on OSM platforms by
matching contact information Another example is the creation of lookalike audiences which
allows the targeting of new users who have similar characteristics as a specified group of
individuals Additionally it is also possible to target users who have visited a particular website
outside of the OSM platform Hence targeting through OSM platforms can be based on very
specific individual properties and behaviour
Because the targeting options are extensive advertisers sometimes chose to cooperate with
intermediaries Traders value intermediaries because of their expertise in both marketing
strategies and platform functionalities Intermediaries are therefore primarily used when
setting up a campaign that is complex in terms of targeting format or content Furthermore
intermediaries may also handle the creation of content and communication through OSM on
behalf of the client Finally certain intermediaries offer software facilitating social media
advertising and evaluating campaign effectiveness These additional features are made
possible because the intermediaries make use of the platformsrsquo API (application programming
interface) to provide data These additional statistics tap into the need for better metrics The
interviewed advertisers indicated that the statistics provided by the social media platforms are
not always adequate Even though the data are detailed the B2B clients and intermediaries
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indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
EUROPEAN COMMISSION
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In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
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10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
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Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
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102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
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Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
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from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
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EUROPEAN COMMISSION
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consumers Two advertisers organisations name this practice as particularly
problematic In their view consumers should not be misled by an ad that looks like editorial
content As one organisation adds it is especially problematic when such an advertisement
reaches young people who may not possess the background knowledge to discern ads from
editorial content Moreover it is problematic when advertisements are integrated into the social
interaction among users It can be perceived as highly intrusive to see an advertisement
between the Snapchat stories of friends or among private messages on Facebook In addition
to the aforementioned downsides certain benefits of more advanced targeting and data usage
were put forward by a broad range of interviewed actors The displayed advertisements are
more interesting and relevant for the social media users Because the content is more relevant
individuals will be less inclined to feel bothered by hem and instead appreciate the commercial
practices For the same reason the targeted messages may add value for consumers rather
than cause annoyance As a global intermediary summarises
ldquoIn a world where we get so many messages its [about] being relevant [in] what you
say being relevant about the type of product for a certain type of peoplerdquo
6 Misleading practices and remedies
61 Types of misleading practices
The interviewed representatives of B2B clients and Intermediaries indicate that they witnessed
only few instances of clearly misleading practices on the large social media They argue that
social media aim to avoid such misleading advertisements as they do not wish to upset users
Since advertising is a crucial element in their business model social media are very careful
about which advertising they show When prompted however the interviewed B2B clients and
Intermediaries were able to provide examples of misleading problematic and unfair commercial
practices Additional information is provided by consumer organisations and academics who
played particular attention to user data collected by social media They also referred to cases
of malware phishing and misleading promotions The types of misleading commercial practices
that are reported can be classified under the following five categories
Disguised marketing
First an often-mentioned problem is the difficulty to recognise advertising on social media
In part the difficulty to identify ads is related to their format For example on Facebook the
difference between sponsored content and user content is very subtle On Twitter as well it is
difficult to know if content is paid for when browsing hashtags A B2B client suggests that social
media purposefully integrate advertising and content
ldquoOn Facebook it is signalled when content is sponsored but it is not very
obvious and this is on purpose because Facebook does not want to show so
clearly that it is an ad
Furthermore commercial practices are sometimes difficult to recognise because the
commercial nature is not disclosed For example the presence of product placement may not
always be clearly labelled or indicated A specific case in this regard are social influencers
Celebrities or individuals who are popular on social media may be paid by brands to mention
or promote their products When they do not disclose being paid this can be misleading
towards consumers The latter problem is mentioned by several intermediaries and an
advertising self-regulatory body The advertisersrsquo organisation indicates that social influencers
are posting sponsored messages on social media but that they are not necessarily following
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 13 EN
the rules set out by self-regulatory bodies (ICC) and by the European Commission (UCPD) It
is argued that such failures may be due to inexperience and lack of familiarity with the existing
rules rather than a conscious intent not to adhere to them
Misleading marketing content
A second type of problematic commercial practice concerns misleading or incorrect product
or price descriptions This includes advertising with misleading information about the price
of a product (eg claiming something is free when it is not) the qualities of the product or
incorrectly claiming that an offer is limited in time This type of misinformation also includes
social media campaigns that are referring to a promotion which is no longer valid
Intermediaries and B2B clients further mentioned that product endorsements by social media
users may not always be fully genuine as they could be part of a lsquoshare and winrsquo or lsquolike and
winrsquo action
Undesirable or improper user targeting
Undesirable or improper user targeting is a third important problematic commercial practice
Several B2B clients and intermediaries mention that many users are unaware of how they are
being tracked and how this affects the advertisements that they see The fact that advertising
is personalised and targeted at specific groups without the users being fully knowledgeable
about it is perceived as problematic by an interviewed academic For example many social
media users may not be aware of any behavioural tracking that occurs (eg platforms tracking
the usersrsquo activities on their website and on many other websites that users visit) It implies
that users may not have been sufficiently informed to give consent to this type of tracking
Furthermore brands can advertise to users who have never lsquolikedrsquo the brandrsquos page or have
no interest in the brand at all (for instance by inserting advertisements on their Facebook News
Feed) A B2B client explains that this practice can make users angry based on individual
comments on the companyrsquos Facebook posts and private messages received through Facebook
Targeting can also fail when it is based on inaccurate information or wrong assumptions Users
may for instance be targeted with products they have already bought
Processing of private data
Fourthly participants in the stakeholder survey indicate that it is problematic when very
private data is not processed transparently Social media collect many different types of
information about their users including profile data activities on the platform real-world
location et cetera How these data are used however is not entirely clear to users The B2B
clients and consumer organisations expressed concern about what data is stored how safe it
is stored and whom it is shared with A consumer organisation mentioned that online social
media do not limit the storage of data in time ie it is stored indefinitely The same
organisation also points out a problematic example of a mobile phone banking app which sends
information to Facebook without notifying its users With WhatsApp being part of Facebook a
local intermediary finds it increasingly unclear which information shared with others is still
private and which can also be used for commercial purposes
Aggressive or criminal practices
A final type of problematic commercial practices concern cases of aggressive or criminal
practices Although the stakeholders indicated that criminal practices are not widespread on
social media they did refer to scams phishing and other illegal activities One particular
example provided by a global intermediary concerns a fake airline profile on social media
which promised that a user can win euro3000 by sharing a message These profile pages receive
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 14 EN
a high amount of visitors and can afterwards be sold on the black market Other cases
mentioned in two B2B interviews are about lsquoaggressiversquo advertisements and aggressive phone
calls after entering contact details on social media
62 Remedies
Various remedies are suggested to counter the aforementioned misleading unfair or
problematic practices The stakeholders interviewed see a role for advertisers social media
users platform owners and governments Intermediaries and B2B clients recognise their role
as advertisers to engage in fair commercial practices that are relevant for consumers In
addition these actors also point out the responsibilities of social media users The latter have
the ability to shape their online advertising environment by indicating which advertisements
they like or do not like As a global intermediary summarises it
ldquoId rather see something that I like or might like instead of tampon commercials So
you yourself [as a user] can make that ad environment just better and more personal
So why wouldnrsquot yourdquo
Furthermore users can report the ads that they find problematic through the automated
reporting on social media The interviewed intermediaries and B2B clients strongly encourage
this
Nevertheless social media providers also have a role in this process Certain B2B clients
and intermediary stakeholders indicate that it is unclear how complaints and reports are
handled Social media providers could be more lsquohands-onrsquo in dealing with user complaints and
when approving advertising Even though the platform owners do not have the capacity to
manually check every advertisement the interviewed advertisers stress the importance of
having a human being (in addition to a computer system) estimate which practices are
acceptable and which are not Furthermore a self-regulatory advertising body proposes that
social media immediately take down advertisements when the self-regulatory body has decided
that they are not acceptable
From the interviews with the different types of stakeholders three key steps to be taken by
social media providers emerged (1) simplify their terms and conditions as well as privacy
policy and present these terms to users in a clear and understandable way (2) label advertising
more prominently and ensure that the same wordingformatting is used throughout the entire
platform and (3) offer more options as opt-in features rather than opt-out With regard to the
first aspect a consumer organisation argues that If the terms of services are not available
and not understandable then its impossible to get an actual consent from the consumer
Finally certain participants in the survey identified a role for governments An intermediary
and consumer organisation suggest that governments (eg on a European level) should
monitor commercial practices performed on online social media and track new technologies
that could potentially violate consumer rights In terms of the current commercial practices on
social media the interviewees from different stakeholder categories identified the need for
laws on privacy and data protection to be adapted to the current practices on social
media Finally legislation is requested to ensure that social influencers are required to
disclose when they are being paid for certain messages With regard to the latter a global
intermediary adds the following
ldquoJust like we have to do on TV and say there is product placement in the TV
show you should be obliged to do it on your social mediardquo
7 Issues and complaints
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 15 EN
71 Consumers
Consumers have different means of complaining about problematic commercial practices on
social media The most common channel to voice complaints is through the social media
platforms themselves On Facebook users may for instance click negative emoticons post
comments or report the advertisement Less commonly private messages can also be sent
to advertisers Depending on the situation either social media providers deal with a complaint
(eg for complaints expressed through the reporting tool) or the advertiser handles it (eg
for complaints communicated through comments or private messages) Consumers almost
never address their complaints to intermediaries because for social media users it is not visible
which intermediaries are behind a campaign Intermediaries may deal with user complaints in
the name of their end clients or they may forward the complaints to their clients Certain
intermediaries are not at all involved in dealing with user complaints for example
intermediaries which offer software for metrics Some actors use a very structured approach
in answering user feedback One of the interviewed B2B clients makes use of a flow chart to
identify which actions to take in case of user positive neutral or negative consumer response
on social media
The interviewed B2B clients intermediaries and consumer organisations primarily identified
user complains concerning the high number of advertisements (lsquospammingrsquo or lsquopolluting their
contentrsquo) the targeting of commercial practices (mistargeting showing irrelevant ads or re-
targeting advertisement) and the difficulty to identify advertising and discern it from other
content With regard to the latter an advertising self-regulating body reports an
increase in the complaints about social influencers who do not clearly identify which
of their activities are sponsored
72 B2B clients
The issues and complaints that advertisers have are related to the social media platforms
Nevertheless the number of complaints is very limited When issues do arise they are
sometimes related to the platform disapproving an advertiserrsquos campaign without a clear
reason the complexity of the options when advertising on social media and the difficulty of
working with the platformrsquos API (Application Programming Interface)
8 Actions by enforcement authorities
Involvement of enforcement authorities was not a common action when dealing with
problematic commercial practices An important explanation for this is that ndash as multiple
stakeholders indicated ndash going to court takes time It is far more likely that a consumer
complaint is resolved by the advertising company or that a self-regulatory body is involved
The German advertising self-regulator pointed out that their process is much faster than a
court procedure However when the regulator lacks resources or when the complaint deals
with criminal activities the issue is taken to the enforcement authorities
When enforcement authorities are involved it usually concerns the most serious complaints
Examples mentioned by the interviewees include cases about criminal activities (Germany)
alcohol advertising (Poland) data collection (Italy) and out-of-stock products (Belgium) In
many of the cases mentioned in the interviews the government was involved by filing a
complaint against certain commercial practices
Whereas investigations against social influencers are not common in Europe the United States
enforce a more extensive legislation on this topic A respondent from a global intermediary was
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 16 EN
aware of a case in the United States where the legal authorities had fined YouTube influencers
for not disclosing sponsorship
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Directorate-General for Consumers
2018 EUR 17 EN
9 Conclusions
The stakeholder survey is part of subtask 14 which aimed to investigate marketing practices
on online social media from a traderrsquos point of view The survey consisted of 50 in-depth
interviews of stakeholders belonging to relevant subgroups with different perspectives and
explored the roles and responsibilities of OSM providers and other actors in the commercial
practices on their platforms More specifically the stakeholder survey aimed to acquire
information about which commercial practices can be found on social media and in what way
certain practices may be misleading unfair or problematic for consumers Additionally the
views of the different stakeholders were assessed and compared as well as their role in the
commercial practices
Types of commercial practices on social media
The stakeholders interviewed differentiate two broad types of activities
- Posting lsquoorganicallyrsquo publishing interesting content without paying for it
- Performing lsquomarketingrsquo engaging in payed-for commercial practices
Additional practices emerged during the interviews including paying social influencers for
promoting products or services managing the social media pages or communities of brands
and analysing what is being said about brands on social media These services can be offered
by local or global intermediaries or by individual social influencers
91 Novel commercial practices on social media
Throughout the stakeholder interviews different functionalities and targeting methods on social
media were discussed The four largest OSM platforms covered in the majority of the
interviews offer extensive possibilities for engaging in commercial practices To compete with
other platforms the major social media are also continuously creating new possibilities for
advertisers and traders which they promote through sales persons and tutorials
Among these new functionalities are extensive options for targeting advertisements The main
OSM platforms allow targeting based on information contained in the registered user profile
interest-related data and behavioural data A relatively new feature of targeting is the use of
custom audiences by targeting clients in the companyrsquos database on OSM platforms by
matching contact information Another example is the creation of lookalike audiences which
allows the targeting of new users who have similar characteristics as a specified group of
individuals Additionally it is also possible to target users who have visited a particular website
outside of the OSM platform Hence targeting through OSM platforms can be based on very
specific individual properties and behaviour
Because the targeting options are extensive advertisers sometimes chose to cooperate with
intermediaries Traders value intermediaries because of their expertise in both marketing
strategies and platform functionalities Intermediaries are therefore primarily used when
setting up a campaign that is complex in terms of targeting format or content Furthermore
intermediaries may also handle the creation of content and communication through OSM on
behalf of the client Finally certain intermediaries offer software facilitating social media
advertising and evaluating campaign effectiveness These additional features are made
possible because the intermediaries make use of the platformsrsquo API (application programming
interface) to provide data These additional statistics tap into the need for better metrics The
interviewed advertisers indicated that the statistics provided by the social media platforms are
not always adequate Even though the data are detailed the B2B clients and intermediaries
EUROPEAN COMMISSION
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indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
EUROPEAN COMMISSION
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In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 20 EN
10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 21 EN
Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
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2018 EUR 22 EN
102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 24 EN
Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 13 EN
the rules set out by self-regulatory bodies (ICC) and by the European Commission (UCPD) It
is argued that such failures may be due to inexperience and lack of familiarity with the existing
rules rather than a conscious intent not to adhere to them
Misleading marketing content
A second type of problematic commercial practice concerns misleading or incorrect product
or price descriptions This includes advertising with misleading information about the price
of a product (eg claiming something is free when it is not) the qualities of the product or
incorrectly claiming that an offer is limited in time This type of misinformation also includes
social media campaigns that are referring to a promotion which is no longer valid
Intermediaries and B2B clients further mentioned that product endorsements by social media
users may not always be fully genuine as they could be part of a lsquoshare and winrsquo or lsquolike and
winrsquo action
Undesirable or improper user targeting
Undesirable or improper user targeting is a third important problematic commercial practice
Several B2B clients and intermediaries mention that many users are unaware of how they are
being tracked and how this affects the advertisements that they see The fact that advertising
is personalised and targeted at specific groups without the users being fully knowledgeable
about it is perceived as problematic by an interviewed academic For example many social
media users may not be aware of any behavioural tracking that occurs (eg platforms tracking
the usersrsquo activities on their website and on many other websites that users visit) It implies
that users may not have been sufficiently informed to give consent to this type of tracking
Furthermore brands can advertise to users who have never lsquolikedrsquo the brandrsquos page or have
no interest in the brand at all (for instance by inserting advertisements on their Facebook News
Feed) A B2B client explains that this practice can make users angry based on individual
comments on the companyrsquos Facebook posts and private messages received through Facebook
Targeting can also fail when it is based on inaccurate information or wrong assumptions Users
may for instance be targeted with products they have already bought
Processing of private data
Fourthly participants in the stakeholder survey indicate that it is problematic when very
private data is not processed transparently Social media collect many different types of
information about their users including profile data activities on the platform real-world
location et cetera How these data are used however is not entirely clear to users The B2B
clients and consumer organisations expressed concern about what data is stored how safe it
is stored and whom it is shared with A consumer organisation mentioned that online social
media do not limit the storage of data in time ie it is stored indefinitely The same
organisation also points out a problematic example of a mobile phone banking app which sends
information to Facebook without notifying its users With WhatsApp being part of Facebook a
local intermediary finds it increasingly unclear which information shared with others is still
private and which can also be used for commercial purposes
Aggressive or criminal practices
A final type of problematic commercial practices concern cases of aggressive or criminal
practices Although the stakeholders indicated that criminal practices are not widespread on
social media they did refer to scams phishing and other illegal activities One particular
example provided by a global intermediary concerns a fake airline profile on social media
which promised that a user can win euro3000 by sharing a message These profile pages receive
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 14 EN
a high amount of visitors and can afterwards be sold on the black market Other cases
mentioned in two B2B interviews are about lsquoaggressiversquo advertisements and aggressive phone
calls after entering contact details on social media
62 Remedies
Various remedies are suggested to counter the aforementioned misleading unfair or
problematic practices The stakeholders interviewed see a role for advertisers social media
users platform owners and governments Intermediaries and B2B clients recognise their role
as advertisers to engage in fair commercial practices that are relevant for consumers In
addition these actors also point out the responsibilities of social media users The latter have
the ability to shape their online advertising environment by indicating which advertisements
they like or do not like As a global intermediary summarises it
ldquoId rather see something that I like or might like instead of tampon commercials So
you yourself [as a user] can make that ad environment just better and more personal
So why wouldnrsquot yourdquo
Furthermore users can report the ads that they find problematic through the automated
reporting on social media The interviewed intermediaries and B2B clients strongly encourage
this
Nevertheless social media providers also have a role in this process Certain B2B clients
and intermediary stakeholders indicate that it is unclear how complaints and reports are
handled Social media providers could be more lsquohands-onrsquo in dealing with user complaints and
when approving advertising Even though the platform owners do not have the capacity to
manually check every advertisement the interviewed advertisers stress the importance of
having a human being (in addition to a computer system) estimate which practices are
acceptable and which are not Furthermore a self-regulatory advertising body proposes that
social media immediately take down advertisements when the self-regulatory body has decided
that they are not acceptable
From the interviews with the different types of stakeholders three key steps to be taken by
social media providers emerged (1) simplify their terms and conditions as well as privacy
policy and present these terms to users in a clear and understandable way (2) label advertising
more prominently and ensure that the same wordingformatting is used throughout the entire
platform and (3) offer more options as opt-in features rather than opt-out With regard to the
first aspect a consumer organisation argues that If the terms of services are not available
and not understandable then its impossible to get an actual consent from the consumer
Finally certain participants in the survey identified a role for governments An intermediary
and consumer organisation suggest that governments (eg on a European level) should
monitor commercial practices performed on online social media and track new technologies
that could potentially violate consumer rights In terms of the current commercial practices on
social media the interviewees from different stakeholder categories identified the need for
laws on privacy and data protection to be adapted to the current practices on social
media Finally legislation is requested to ensure that social influencers are required to
disclose when they are being paid for certain messages With regard to the latter a global
intermediary adds the following
ldquoJust like we have to do on TV and say there is product placement in the TV
show you should be obliged to do it on your social mediardquo
7 Issues and complaints
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 15 EN
71 Consumers
Consumers have different means of complaining about problematic commercial practices on
social media The most common channel to voice complaints is through the social media
platforms themselves On Facebook users may for instance click negative emoticons post
comments or report the advertisement Less commonly private messages can also be sent
to advertisers Depending on the situation either social media providers deal with a complaint
(eg for complaints expressed through the reporting tool) or the advertiser handles it (eg
for complaints communicated through comments or private messages) Consumers almost
never address their complaints to intermediaries because for social media users it is not visible
which intermediaries are behind a campaign Intermediaries may deal with user complaints in
the name of their end clients or they may forward the complaints to their clients Certain
intermediaries are not at all involved in dealing with user complaints for example
intermediaries which offer software for metrics Some actors use a very structured approach
in answering user feedback One of the interviewed B2B clients makes use of a flow chart to
identify which actions to take in case of user positive neutral or negative consumer response
on social media
The interviewed B2B clients intermediaries and consumer organisations primarily identified
user complains concerning the high number of advertisements (lsquospammingrsquo or lsquopolluting their
contentrsquo) the targeting of commercial practices (mistargeting showing irrelevant ads or re-
targeting advertisement) and the difficulty to identify advertising and discern it from other
content With regard to the latter an advertising self-regulating body reports an
increase in the complaints about social influencers who do not clearly identify which
of their activities are sponsored
72 B2B clients
The issues and complaints that advertisers have are related to the social media platforms
Nevertheless the number of complaints is very limited When issues do arise they are
sometimes related to the platform disapproving an advertiserrsquos campaign without a clear
reason the complexity of the options when advertising on social media and the difficulty of
working with the platformrsquos API (Application Programming Interface)
8 Actions by enforcement authorities
Involvement of enforcement authorities was not a common action when dealing with
problematic commercial practices An important explanation for this is that ndash as multiple
stakeholders indicated ndash going to court takes time It is far more likely that a consumer
complaint is resolved by the advertising company or that a self-regulatory body is involved
The German advertising self-regulator pointed out that their process is much faster than a
court procedure However when the regulator lacks resources or when the complaint deals
with criminal activities the issue is taken to the enforcement authorities
When enforcement authorities are involved it usually concerns the most serious complaints
Examples mentioned by the interviewees include cases about criminal activities (Germany)
alcohol advertising (Poland) data collection (Italy) and out-of-stock products (Belgium) In
many of the cases mentioned in the interviews the government was involved by filing a
complaint against certain commercial practices
Whereas investigations against social influencers are not common in Europe the United States
enforce a more extensive legislation on this topic A respondent from a global intermediary was
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 16 EN
aware of a case in the United States where the legal authorities had fined YouTube influencers
for not disclosing sponsorship
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 17 EN
9 Conclusions
The stakeholder survey is part of subtask 14 which aimed to investigate marketing practices
on online social media from a traderrsquos point of view The survey consisted of 50 in-depth
interviews of stakeholders belonging to relevant subgroups with different perspectives and
explored the roles and responsibilities of OSM providers and other actors in the commercial
practices on their platforms More specifically the stakeholder survey aimed to acquire
information about which commercial practices can be found on social media and in what way
certain practices may be misleading unfair or problematic for consumers Additionally the
views of the different stakeholders were assessed and compared as well as their role in the
commercial practices
Types of commercial practices on social media
The stakeholders interviewed differentiate two broad types of activities
- Posting lsquoorganicallyrsquo publishing interesting content without paying for it
- Performing lsquomarketingrsquo engaging in payed-for commercial practices
Additional practices emerged during the interviews including paying social influencers for
promoting products or services managing the social media pages or communities of brands
and analysing what is being said about brands on social media These services can be offered
by local or global intermediaries or by individual social influencers
91 Novel commercial practices on social media
Throughout the stakeholder interviews different functionalities and targeting methods on social
media were discussed The four largest OSM platforms covered in the majority of the
interviews offer extensive possibilities for engaging in commercial practices To compete with
other platforms the major social media are also continuously creating new possibilities for
advertisers and traders which they promote through sales persons and tutorials
Among these new functionalities are extensive options for targeting advertisements The main
OSM platforms allow targeting based on information contained in the registered user profile
interest-related data and behavioural data A relatively new feature of targeting is the use of
custom audiences by targeting clients in the companyrsquos database on OSM platforms by
matching contact information Another example is the creation of lookalike audiences which
allows the targeting of new users who have similar characteristics as a specified group of
individuals Additionally it is also possible to target users who have visited a particular website
outside of the OSM platform Hence targeting through OSM platforms can be based on very
specific individual properties and behaviour
Because the targeting options are extensive advertisers sometimes chose to cooperate with
intermediaries Traders value intermediaries because of their expertise in both marketing
strategies and platform functionalities Intermediaries are therefore primarily used when
setting up a campaign that is complex in terms of targeting format or content Furthermore
intermediaries may also handle the creation of content and communication through OSM on
behalf of the client Finally certain intermediaries offer software facilitating social media
advertising and evaluating campaign effectiveness These additional features are made
possible because the intermediaries make use of the platformsrsquo API (application programming
interface) to provide data These additional statistics tap into the need for better metrics The
interviewed advertisers indicated that the statistics provided by the social media platforms are
not always adequate Even though the data are detailed the B2B clients and intermediaries
EUROPEAN COMMISSION
Directorate-General for Consumers
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indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
EUROPEAN COMMISSION
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In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 20 EN
10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
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Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
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102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 24 EN
Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 14 EN
a high amount of visitors and can afterwards be sold on the black market Other cases
mentioned in two B2B interviews are about lsquoaggressiversquo advertisements and aggressive phone
calls after entering contact details on social media
62 Remedies
Various remedies are suggested to counter the aforementioned misleading unfair or
problematic practices The stakeholders interviewed see a role for advertisers social media
users platform owners and governments Intermediaries and B2B clients recognise their role
as advertisers to engage in fair commercial practices that are relevant for consumers In
addition these actors also point out the responsibilities of social media users The latter have
the ability to shape their online advertising environment by indicating which advertisements
they like or do not like As a global intermediary summarises it
ldquoId rather see something that I like or might like instead of tampon commercials So
you yourself [as a user] can make that ad environment just better and more personal
So why wouldnrsquot yourdquo
Furthermore users can report the ads that they find problematic through the automated
reporting on social media The interviewed intermediaries and B2B clients strongly encourage
this
Nevertheless social media providers also have a role in this process Certain B2B clients
and intermediary stakeholders indicate that it is unclear how complaints and reports are
handled Social media providers could be more lsquohands-onrsquo in dealing with user complaints and
when approving advertising Even though the platform owners do not have the capacity to
manually check every advertisement the interviewed advertisers stress the importance of
having a human being (in addition to a computer system) estimate which practices are
acceptable and which are not Furthermore a self-regulatory advertising body proposes that
social media immediately take down advertisements when the self-regulatory body has decided
that they are not acceptable
From the interviews with the different types of stakeholders three key steps to be taken by
social media providers emerged (1) simplify their terms and conditions as well as privacy
policy and present these terms to users in a clear and understandable way (2) label advertising
more prominently and ensure that the same wordingformatting is used throughout the entire
platform and (3) offer more options as opt-in features rather than opt-out With regard to the
first aspect a consumer organisation argues that If the terms of services are not available
and not understandable then its impossible to get an actual consent from the consumer
Finally certain participants in the survey identified a role for governments An intermediary
and consumer organisation suggest that governments (eg on a European level) should
monitor commercial practices performed on online social media and track new technologies
that could potentially violate consumer rights In terms of the current commercial practices on
social media the interviewees from different stakeholder categories identified the need for
laws on privacy and data protection to be adapted to the current practices on social
media Finally legislation is requested to ensure that social influencers are required to
disclose when they are being paid for certain messages With regard to the latter a global
intermediary adds the following
ldquoJust like we have to do on TV and say there is product placement in the TV
show you should be obliged to do it on your social mediardquo
7 Issues and complaints
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 15 EN
71 Consumers
Consumers have different means of complaining about problematic commercial practices on
social media The most common channel to voice complaints is through the social media
platforms themselves On Facebook users may for instance click negative emoticons post
comments or report the advertisement Less commonly private messages can also be sent
to advertisers Depending on the situation either social media providers deal with a complaint
(eg for complaints expressed through the reporting tool) or the advertiser handles it (eg
for complaints communicated through comments or private messages) Consumers almost
never address their complaints to intermediaries because for social media users it is not visible
which intermediaries are behind a campaign Intermediaries may deal with user complaints in
the name of their end clients or they may forward the complaints to their clients Certain
intermediaries are not at all involved in dealing with user complaints for example
intermediaries which offer software for metrics Some actors use a very structured approach
in answering user feedback One of the interviewed B2B clients makes use of a flow chart to
identify which actions to take in case of user positive neutral or negative consumer response
on social media
The interviewed B2B clients intermediaries and consumer organisations primarily identified
user complains concerning the high number of advertisements (lsquospammingrsquo or lsquopolluting their
contentrsquo) the targeting of commercial practices (mistargeting showing irrelevant ads or re-
targeting advertisement) and the difficulty to identify advertising and discern it from other
content With regard to the latter an advertising self-regulating body reports an
increase in the complaints about social influencers who do not clearly identify which
of their activities are sponsored
72 B2B clients
The issues and complaints that advertisers have are related to the social media platforms
Nevertheless the number of complaints is very limited When issues do arise they are
sometimes related to the platform disapproving an advertiserrsquos campaign without a clear
reason the complexity of the options when advertising on social media and the difficulty of
working with the platformrsquos API (Application Programming Interface)
8 Actions by enforcement authorities
Involvement of enforcement authorities was not a common action when dealing with
problematic commercial practices An important explanation for this is that ndash as multiple
stakeholders indicated ndash going to court takes time It is far more likely that a consumer
complaint is resolved by the advertising company or that a self-regulatory body is involved
The German advertising self-regulator pointed out that their process is much faster than a
court procedure However when the regulator lacks resources or when the complaint deals
with criminal activities the issue is taken to the enforcement authorities
When enforcement authorities are involved it usually concerns the most serious complaints
Examples mentioned by the interviewees include cases about criminal activities (Germany)
alcohol advertising (Poland) data collection (Italy) and out-of-stock products (Belgium) In
many of the cases mentioned in the interviews the government was involved by filing a
complaint against certain commercial practices
Whereas investigations against social influencers are not common in Europe the United States
enforce a more extensive legislation on this topic A respondent from a global intermediary was
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 16 EN
aware of a case in the United States where the legal authorities had fined YouTube influencers
for not disclosing sponsorship
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 17 EN
9 Conclusions
The stakeholder survey is part of subtask 14 which aimed to investigate marketing practices
on online social media from a traderrsquos point of view The survey consisted of 50 in-depth
interviews of stakeholders belonging to relevant subgroups with different perspectives and
explored the roles and responsibilities of OSM providers and other actors in the commercial
practices on their platforms More specifically the stakeholder survey aimed to acquire
information about which commercial practices can be found on social media and in what way
certain practices may be misleading unfair or problematic for consumers Additionally the
views of the different stakeholders were assessed and compared as well as their role in the
commercial practices
Types of commercial practices on social media
The stakeholders interviewed differentiate two broad types of activities
- Posting lsquoorganicallyrsquo publishing interesting content without paying for it
- Performing lsquomarketingrsquo engaging in payed-for commercial practices
Additional practices emerged during the interviews including paying social influencers for
promoting products or services managing the social media pages or communities of brands
and analysing what is being said about brands on social media These services can be offered
by local or global intermediaries or by individual social influencers
91 Novel commercial practices on social media
Throughout the stakeholder interviews different functionalities and targeting methods on social
media were discussed The four largest OSM platforms covered in the majority of the
interviews offer extensive possibilities for engaging in commercial practices To compete with
other platforms the major social media are also continuously creating new possibilities for
advertisers and traders which they promote through sales persons and tutorials
Among these new functionalities are extensive options for targeting advertisements The main
OSM platforms allow targeting based on information contained in the registered user profile
interest-related data and behavioural data A relatively new feature of targeting is the use of
custom audiences by targeting clients in the companyrsquos database on OSM platforms by
matching contact information Another example is the creation of lookalike audiences which
allows the targeting of new users who have similar characteristics as a specified group of
individuals Additionally it is also possible to target users who have visited a particular website
outside of the OSM platform Hence targeting through OSM platforms can be based on very
specific individual properties and behaviour
Because the targeting options are extensive advertisers sometimes chose to cooperate with
intermediaries Traders value intermediaries because of their expertise in both marketing
strategies and platform functionalities Intermediaries are therefore primarily used when
setting up a campaign that is complex in terms of targeting format or content Furthermore
intermediaries may also handle the creation of content and communication through OSM on
behalf of the client Finally certain intermediaries offer software facilitating social media
advertising and evaluating campaign effectiveness These additional features are made
possible because the intermediaries make use of the platformsrsquo API (application programming
interface) to provide data These additional statistics tap into the need for better metrics The
interviewed advertisers indicated that the statistics provided by the social media platforms are
not always adequate Even though the data are detailed the B2B clients and intermediaries
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 18 EN
indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
EUROPEAN COMMISSION
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2018 EUR 19 EN
In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 20 EN
10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
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2018 EUR 21 EN
Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
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2018 EUR 22 EN
102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 24 EN
Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 15 EN
71 Consumers
Consumers have different means of complaining about problematic commercial practices on
social media The most common channel to voice complaints is through the social media
platforms themselves On Facebook users may for instance click negative emoticons post
comments or report the advertisement Less commonly private messages can also be sent
to advertisers Depending on the situation either social media providers deal with a complaint
(eg for complaints expressed through the reporting tool) or the advertiser handles it (eg
for complaints communicated through comments or private messages) Consumers almost
never address their complaints to intermediaries because for social media users it is not visible
which intermediaries are behind a campaign Intermediaries may deal with user complaints in
the name of their end clients or they may forward the complaints to their clients Certain
intermediaries are not at all involved in dealing with user complaints for example
intermediaries which offer software for metrics Some actors use a very structured approach
in answering user feedback One of the interviewed B2B clients makes use of a flow chart to
identify which actions to take in case of user positive neutral or negative consumer response
on social media
The interviewed B2B clients intermediaries and consumer organisations primarily identified
user complains concerning the high number of advertisements (lsquospammingrsquo or lsquopolluting their
contentrsquo) the targeting of commercial practices (mistargeting showing irrelevant ads or re-
targeting advertisement) and the difficulty to identify advertising and discern it from other
content With regard to the latter an advertising self-regulating body reports an
increase in the complaints about social influencers who do not clearly identify which
of their activities are sponsored
72 B2B clients
The issues and complaints that advertisers have are related to the social media platforms
Nevertheless the number of complaints is very limited When issues do arise they are
sometimes related to the platform disapproving an advertiserrsquos campaign without a clear
reason the complexity of the options when advertising on social media and the difficulty of
working with the platformrsquos API (Application Programming Interface)
8 Actions by enforcement authorities
Involvement of enforcement authorities was not a common action when dealing with
problematic commercial practices An important explanation for this is that ndash as multiple
stakeholders indicated ndash going to court takes time It is far more likely that a consumer
complaint is resolved by the advertising company or that a self-regulatory body is involved
The German advertising self-regulator pointed out that their process is much faster than a
court procedure However when the regulator lacks resources or when the complaint deals
with criminal activities the issue is taken to the enforcement authorities
When enforcement authorities are involved it usually concerns the most serious complaints
Examples mentioned by the interviewees include cases about criminal activities (Germany)
alcohol advertising (Poland) data collection (Italy) and out-of-stock products (Belgium) In
many of the cases mentioned in the interviews the government was involved by filing a
complaint against certain commercial practices
Whereas investigations against social influencers are not common in Europe the United States
enforce a more extensive legislation on this topic A respondent from a global intermediary was
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 16 EN
aware of a case in the United States where the legal authorities had fined YouTube influencers
for not disclosing sponsorship
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 17 EN
9 Conclusions
The stakeholder survey is part of subtask 14 which aimed to investigate marketing practices
on online social media from a traderrsquos point of view The survey consisted of 50 in-depth
interviews of stakeholders belonging to relevant subgroups with different perspectives and
explored the roles and responsibilities of OSM providers and other actors in the commercial
practices on their platforms More specifically the stakeholder survey aimed to acquire
information about which commercial practices can be found on social media and in what way
certain practices may be misleading unfair or problematic for consumers Additionally the
views of the different stakeholders were assessed and compared as well as their role in the
commercial practices
Types of commercial practices on social media
The stakeholders interviewed differentiate two broad types of activities
- Posting lsquoorganicallyrsquo publishing interesting content without paying for it
- Performing lsquomarketingrsquo engaging in payed-for commercial practices
Additional practices emerged during the interviews including paying social influencers for
promoting products or services managing the social media pages or communities of brands
and analysing what is being said about brands on social media These services can be offered
by local or global intermediaries or by individual social influencers
91 Novel commercial practices on social media
Throughout the stakeholder interviews different functionalities and targeting methods on social
media were discussed The four largest OSM platforms covered in the majority of the
interviews offer extensive possibilities for engaging in commercial practices To compete with
other platforms the major social media are also continuously creating new possibilities for
advertisers and traders which they promote through sales persons and tutorials
Among these new functionalities are extensive options for targeting advertisements The main
OSM platforms allow targeting based on information contained in the registered user profile
interest-related data and behavioural data A relatively new feature of targeting is the use of
custom audiences by targeting clients in the companyrsquos database on OSM platforms by
matching contact information Another example is the creation of lookalike audiences which
allows the targeting of new users who have similar characteristics as a specified group of
individuals Additionally it is also possible to target users who have visited a particular website
outside of the OSM platform Hence targeting through OSM platforms can be based on very
specific individual properties and behaviour
Because the targeting options are extensive advertisers sometimes chose to cooperate with
intermediaries Traders value intermediaries because of their expertise in both marketing
strategies and platform functionalities Intermediaries are therefore primarily used when
setting up a campaign that is complex in terms of targeting format or content Furthermore
intermediaries may also handle the creation of content and communication through OSM on
behalf of the client Finally certain intermediaries offer software facilitating social media
advertising and evaluating campaign effectiveness These additional features are made
possible because the intermediaries make use of the platformsrsquo API (application programming
interface) to provide data These additional statistics tap into the need for better metrics The
interviewed advertisers indicated that the statistics provided by the social media platforms are
not always adequate Even though the data are detailed the B2B clients and intermediaries
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 18 EN
indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 19 EN
In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 20 EN
10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 21 EN
Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 22 EN
102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 24 EN
Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 16 EN
aware of a case in the United States where the legal authorities had fined YouTube influencers
for not disclosing sponsorship
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 17 EN
9 Conclusions
The stakeholder survey is part of subtask 14 which aimed to investigate marketing practices
on online social media from a traderrsquos point of view The survey consisted of 50 in-depth
interviews of stakeholders belonging to relevant subgroups with different perspectives and
explored the roles and responsibilities of OSM providers and other actors in the commercial
practices on their platforms More specifically the stakeholder survey aimed to acquire
information about which commercial practices can be found on social media and in what way
certain practices may be misleading unfair or problematic for consumers Additionally the
views of the different stakeholders were assessed and compared as well as their role in the
commercial practices
Types of commercial practices on social media
The stakeholders interviewed differentiate two broad types of activities
- Posting lsquoorganicallyrsquo publishing interesting content without paying for it
- Performing lsquomarketingrsquo engaging in payed-for commercial practices
Additional practices emerged during the interviews including paying social influencers for
promoting products or services managing the social media pages or communities of brands
and analysing what is being said about brands on social media These services can be offered
by local or global intermediaries or by individual social influencers
91 Novel commercial practices on social media
Throughout the stakeholder interviews different functionalities and targeting methods on social
media were discussed The four largest OSM platforms covered in the majority of the
interviews offer extensive possibilities for engaging in commercial practices To compete with
other platforms the major social media are also continuously creating new possibilities for
advertisers and traders which they promote through sales persons and tutorials
Among these new functionalities are extensive options for targeting advertisements The main
OSM platforms allow targeting based on information contained in the registered user profile
interest-related data and behavioural data A relatively new feature of targeting is the use of
custom audiences by targeting clients in the companyrsquos database on OSM platforms by
matching contact information Another example is the creation of lookalike audiences which
allows the targeting of new users who have similar characteristics as a specified group of
individuals Additionally it is also possible to target users who have visited a particular website
outside of the OSM platform Hence targeting through OSM platforms can be based on very
specific individual properties and behaviour
Because the targeting options are extensive advertisers sometimes chose to cooperate with
intermediaries Traders value intermediaries because of their expertise in both marketing
strategies and platform functionalities Intermediaries are therefore primarily used when
setting up a campaign that is complex in terms of targeting format or content Furthermore
intermediaries may also handle the creation of content and communication through OSM on
behalf of the client Finally certain intermediaries offer software facilitating social media
advertising and evaluating campaign effectiveness These additional features are made
possible because the intermediaries make use of the platformsrsquo API (application programming
interface) to provide data These additional statistics tap into the need for better metrics The
interviewed advertisers indicated that the statistics provided by the social media platforms are
not always adequate Even though the data are detailed the B2B clients and intermediaries
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 18 EN
indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 19 EN
In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 20 EN
10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 21 EN
Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 22 EN
102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 24 EN
Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 17 EN
9 Conclusions
The stakeholder survey is part of subtask 14 which aimed to investigate marketing practices
on online social media from a traderrsquos point of view The survey consisted of 50 in-depth
interviews of stakeholders belonging to relevant subgroups with different perspectives and
explored the roles and responsibilities of OSM providers and other actors in the commercial
practices on their platforms More specifically the stakeholder survey aimed to acquire
information about which commercial practices can be found on social media and in what way
certain practices may be misleading unfair or problematic for consumers Additionally the
views of the different stakeholders were assessed and compared as well as their role in the
commercial practices
Types of commercial practices on social media
The stakeholders interviewed differentiate two broad types of activities
- Posting lsquoorganicallyrsquo publishing interesting content without paying for it
- Performing lsquomarketingrsquo engaging in payed-for commercial practices
Additional practices emerged during the interviews including paying social influencers for
promoting products or services managing the social media pages or communities of brands
and analysing what is being said about brands on social media These services can be offered
by local or global intermediaries or by individual social influencers
91 Novel commercial practices on social media
Throughout the stakeholder interviews different functionalities and targeting methods on social
media were discussed The four largest OSM platforms covered in the majority of the
interviews offer extensive possibilities for engaging in commercial practices To compete with
other platforms the major social media are also continuously creating new possibilities for
advertisers and traders which they promote through sales persons and tutorials
Among these new functionalities are extensive options for targeting advertisements The main
OSM platforms allow targeting based on information contained in the registered user profile
interest-related data and behavioural data A relatively new feature of targeting is the use of
custom audiences by targeting clients in the companyrsquos database on OSM platforms by
matching contact information Another example is the creation of lookalike audiences which
allows the targeting of new users who have similar characteristics as a specified group of
individuals Additionally it is also possible to target users who have visited a particular website
outside of the OSM platform Hence targeting through OSM platforms can be based on very
specific individual properties and behaviour
Because the targeting options are extensive advertisers sometimes chose to cooperate with
intermediaries Traders value intermediaries because of their expertise in both marketing
strategies and platform functionalities Intermediaries are therefore primarily used when
setting up a campaign that is complex in terms of targeting format or content Furthermore
intermediaries may also handle the creation of content and communication through OSM on
behalf of the client Finally certain intermediaries offer software facilitating social media
advertising and evaluating campaign effectiveness These additional features are made
possible because the intermediaries make use of the platformsrsquo API (application programming
interface) to provide data These additional statistics tap into the need for better metrics The
interviewed advertisers indicated that the statistics provided by the social media platforms are
not always adequate Even though the data are detailed the B2B clients and intermediaries
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 18 EN
indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 19 EN
In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 20 EN
10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 21 EN
Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 22 EN
102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 24 EN
Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 18 EN
indicate that they are somewhat high-level and not always useful They are also unsure to what
extent the targeted groups are effectively reached using the available metrics
The B2B clients and intermediaries point out the advantages for consumers of more precise
targeting They indicate that the novel features results in more relevant and interesting ads
which are less likely to bother users They also indicated that platform owners impose limits on
the targeting and advertising options (for example the inability to target very small groups of
individuals and the impossibility to see the identity of the targeted users) By limiting these
options the OSM providers aim to maintain the satisfaction and trust of its users ndash a crucial
aspect for the platforms according to B2B clients and Intermediaries Nevertheless the
interviews revealed several downsides and problematic aspects of new formats features and
targeting options
92 Potentially misleading practices identified by stakeholders
An often-mentioned problem is the difficulty to recognise advertising In certain cases the
commercial nature of an ad may be difficult to recognise or is not disclosed For example
commercial messages are more often being shown inside content space and advertisement
labelling has sometimes become less conspicuous As a result in certain cases the commercial
nature of a piece of content may be hard to discern or is not disclosed In particular
stakeholders mentioned indirect ways of advertising such as promoting brands through social
influencers or having lsquonormalrsquo users promote brands
A second problematic commercial practice concerns misleading or incorrect product or
price descriptions Even though consumers may report these instances it is unclear to that
how the platforms handle their complaint Another problematic issue is undesirable or improper
use of targeting especially because users of OSM often are not aware of how and why they
are targeted This issue is pertinent because users of OSM platforms may not be aware of how
and based on what information they are targeted
A related problem is the difficulty for users to grasp the meaning of the terms and
conditions that the OSM platforms specify Because of this users may not be sufficiently
informed about what they consent to or choose For example social media users may not be
aware of all the behavioural tracking that occurs
A fourth issue is that lack of transparency of how data is processed Consumer
organisations point out that the storage of data is not limited in time that users are not aware
of what is being stored who the data is shared with and which data is combined
93 The role of OSM providers in the approval process formats and
functionalities
Social media providers have a role in the approval of content as well as in taking action
based on user reports The stakeholders indicate that OSM providers have rules about what is
accepted and not accepted in an advertisement These rules are enforced during the approval
procedure prior to publishing an advertisement When submitting an advertisement on
Facebook it is checked through an automated process and the advertiser is notified whether
the ad was approved or rejected In addition users can report problematic advertisements
after they have been published When ads are frequently reported by users Facebook will
increase the price for the advertisers or ask the advertisers to make changes to the
advertisement
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 19 EN
In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 20 EN
10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 21 EN
Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 22 EN
102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 24 EN
Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 19 EN
In terms of formats and functionalities the social media providers are balancing their need
to offer new options to traders as well as retaining the trust of their platform users For
instance social media providers offer information to traders about which users are targeted
even though this information is always anonymous
With regard to targeting OSM providers have an important role They offer the underlying
data for targeting deliver the targeting options to traders design the settings and interface
and they provide the statistics The stakeholders indicated that all major social media providers
(Facebook Google Twitter) offer automated targeting suggestions through the online
interfaces for entering target groups The targeting possibilities are extensive and they allow
the selection of very specific target groups
94 Remedies proposed by industry stakeholders
Several remedies are suggested to counter misleading unfair and problematic practices For
instance OSM providers could be more lsquohands-onrsquo in dealing with user complaints
Furthermore certain interviewed advertisers stressed the importance of having a human being
estimate which practices are acceptable and which are not Furthermore social media could
act on the decisions of self-regulatory advertisement organisations and take down
advertisements when they are deemed inacceptable by these organisations Finally
intermediaries as well as academics recognise the need for clear labelling of marketing content
in particular when social influencers are paid for posting on social media
In sum the stakeholder interviews identified three key steps to be taken by social media
providers
1 simplify their terms and conditions as well as privacy policy and present these in a clear
and understandable way
2 label advertising more prominently and ensure that the same wordingformatting is used
throughout the entire platform and
3 offer more features as opt-in options rather than opt-out
Intermediaries and B2B clients also recognise their role to engage in fair commercial practices
that are relevant for consumers For instance an intermediary indicated that the organisation
would steer away from organising any marketing campaign that is clearly misleading In
addition these actors also point out the responsibilities of social media users who can shape
their online advertising environment by indicating which advertisements they like or dislike
Users can further contribute to a better advertising environment by reporting the ads that they
find problematic through the automated reporting tools on social media This is something the
interviewed intermediaries and B2B clients strongly encourage
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 20 EN
10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 21 EN
Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 22 EN
102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 24 EN
Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 20 EN
10 Appendix
101 Appendix 1 List of stakeholders interviewed
Stakeholder type (number of
interviews) Organisation(s)
Academic (4)
College of Computer and Information Science
University Twente
Max Planck Institute for Software Systems
Hogeschool Utrecht and Universiteit Twente
Advertisers organisation (8) Internet Advertising Bureau
Reklamombudsmannen
Zentrale zur Bekaumlmpfung unlauteren Wettbewerbs
Zentralverband der deutschen Werbewirtschaft
(ZAW)
Zwiazek Stowarzyszen Rada Reklamy
Advertising Standards Authority for Ireland (ASAI)
Committee of Advertising Practice (CAP)
World Federation of Advertisers
B2B client (14) BNP Paribas
SterckLimburg
Mobile Vikings
Vente-Exclusive
Unibet
Thomas More
Companeo
SD Worx
Tui Fly
Groen
VRT
Luminex
Bloovi
[A Belgian automobile constructor]
Consumer organisation (3) Test-Aankoop
Norwegian Consumer Council
Consumentenbond
Global Intermediary (11) Social Lab
Agorapulse
Smartlyio
Emakina
Arena Media Belgium
The Next Ad
Adaptly
Qwaya and Funnelio
The Social Element
[A global digital advertising agency]
[A global advertisement company]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 21 EN
Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 22 EN
102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 24 EN
Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 21 EN
Local Intermediary (13)
Punchlinebe
RCA
bakerMEN
We Are Digital
Analyz-it (Dutch)
Bigtrees
Duval Union Consulting
Goalgorilla
PauwR
Bubka
Pebble Media
Social Inc
[A Belgium-based communication office]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 22 EN
102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 24 EN
Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 22 EN
102 Appendix 2 Stakeholder survey ndash interview guide
[Short introduction to the project and its objectives an explanation of the handling
of individual data gathered ndash no data about the respondentrsquos name or function will be
reported when reporting on the gathered data company names will only be
mentioned for OSM providers when permission is granted]
Q1 What is your professional function
Q2 Which online social media (eg Facebook Youtube Linkedin) are you familiar with in
a professional context With lsquofamiliarrsquo we mean lsquohaving at least some knowledge of how they
operate from a commercial perspectiversquo [explain the way OSM is defined within the scope of
the study and mention types of websitesapps that are excluded a list of top OSM providers
will be available in order to guide respondents on what constitutes OSM in the context of the
study encourage respondent to answer for OSM providers for which feedback is generally
more limited regardless of their specific business relationship to hisher organisation]
Q3 In your daily work in what professional context do you interact with the online social
media you indicated that you are familiar with (eg as competitors business partners or
other) [If some sort of special partnership program is mentioned may be interesting to dig
in briefly on the conditions to be met to entermaintain such a partnership andor the
privileges enjoyed through it]
Q4 Please elaborate on how you interact with online social media from a commercial
(marketing) perspective and the frequency with which you interact with them An
interaction can range from direct contact with employees of the company to indirect contact
through online platforms that serve as Intermediaries [encourage respondent to respond per
OSM provider and to exemplify the relationship and activities in question]
Q5 Please list all types of commercial practices on OSM sites or apps that you are familiar
with or have encountered in a professional context include both direct and indirect
marketing methods [clearly define what is meant by commercial practices within the scope
of this study Ask the respondent to exemplify practices if possible ndash make it more concrete
do not focus on specific OSM providers unless some practices are exclusive to them
encourage focus on less obvious more innovative practices that are typical for OSM]
Q6 What are some of the latest trends in developing new functionalities to help OSM
providers leverage user data [eg moving from marketing to direct selling] Whats the
potential of these trends to be beneficial to consumers How about their potential to be
detrimental or problematic for consumers In what ways
Q7 During your professional career have you encountered specific commercial practices that
could be considered misleading unfair or problematic from a consumer perspective Are
some of these practices specific to certain OSM providers Please provide examples or at
least general outlines if possible [Clarify (if necessary) that misleading or unfair commercial
practices may be aggressive (eg extremely insisting corralling) and are in any case likely to
distort consumersrsquo behaviour ndash refer to UCPD briefing for exact descriptionsdefinition]
Q71 For each of the commercial practices you specified as potentially misleading or unfair for
consumers how could this potential be counterbalanced to limit their impact on consumers
[Encourage a discussion of remedies from both from a legislative perspective but also from
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 24 EN
Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 23 EN
the perspective of (self-)regulation including examples from the organisation the respondent
works for]
Q8 Please select up to three types of commercial practices from the ones you
indicated that you are familiar with that you consider the most interesting or relevant to
discuss in the context of misleading marketing practices [encourage the choice of up to three
different providers if possible unless the person specialises in working with a certain OSM
provider when recording the answers to the following questions it should be clear which
specific providers the respondent is referring to or whether they are speaking about OSM in
general terms]
The questions that follow will go more in-depth into the business processes that are part of
one of these commercial practices namely [practice] [Select one practice that can be
considered indirect marketing (eg product placements) based on misleading potential
innovativeness and feedback obtained from previous interviews to increase the diversity of
practices discussed]
Q81 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the development and approval of the specific content of the marketing content
show to users Please elaborate based on your knowledge of specific policies and common
practices in this area
Q82 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in the design of the format and specific functionalities of the marketing content
shown to users Please elaborate based on your knowledge of specific policies and common
practices in this area [also try to understand from the respondent whether [OSM provider]
has editorial control censorship practices in particular what specific criteria are used for
rejecting ads encourage himher to provide examples of approvedrejected cases as well as
the specific issues discussions and feedback to advertiser related to such cases]
Q83 For [type of commercial practice] what do you perceive to be the role of the OSM
provider in determining the target group an advertisement is shown to Please elaborate
based on your knowledge of specific policies and common practices regarding user
targeting
Q84 For [type of commercial practice] what are the specific services offered by the OSM
provider to Intermediaries (eg marketing partners advertising agencies) Based on your
knowledge do they differ from those offered to direct B2B clients and if yes how Lastly
how are OSM clients (Intermediaries or B2B) charged for these services (eg subscriptions
one-time payments etc)
Q85 What types of after-sale services related to [type of commercial practice] are you
aware of provided by OSM to business customers Please elaborate based on your knowledge
of the types of metrics referring to the objectives achieved (eg reach number of clicks
etc) What is the level of granularity of this reporting Are you aware of which parties use
these metrics and whether they are used for purposes outside of the specific marketing
campaign they were collected for [if low granularity of results metrics shared with business
clients is justified on the basis of benefits to consumers or of consumer protection try an dig
a bit deeper what is meant by this]
[ask the following 3 questions ndash 86 to 88 only to B2B clients and Intermediaries]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 24 EN
Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 24 EN
Q86 Can you briefly describe the steps involved in running a specific marketing campaign
for [type of commercial practice] based on the service that this OSM provider offers It would
be interesting to describe the process from the perspective of [name the
companyorganisation]
Q87 For [name type of commercial practice] what is the specific role that [name the
companyorganisation] plays in designing and running a marketing campaign How much
control over the process do you perceive that your organisation has in this specific role
[when asking this question to representatives of consumer organisations ask it in third name
for both Intermediaries and B2B clients]
Q88 In a general sense how important do you consider the role of Intermediaries to be
compared to direct B2B clients in driving the business for [type of commercial practice] at
[OSM provider] Based on your knowledge and experience how does this compare to other
OSM providers you are familiar with [encourage specific examples]
[end of questions pertaining to the practice outlined in Q8 for all questions that follow place
the focus on practices that represent unfair or misleading marketing when possible]
[Q9 to Q11 should only be asked to representatives of Intermediaries or B2B clients]
Q9 Can you describe and elaborate on specific issues your company has faced with [ldquoI or
OSMrdquo if respondent=B2B ldquoOSM or B2Brdquo if respondent=I] in the past year (or is currently
facing) regarding the control over marketing format content andor targeting for specific
commercial practices More concretely how were these issues tackled and were they
eventually resolved
Q10 Can you describe the most common issues or complaints your company has faced
or received from users or groups of users in the past year (or is currently facing) regarding
the format or content of specific marketing andor targeting practices More concretely how
were these issues tackled (how is your company planning to tackle them) and were they
eventually resolved These can be issues communicated by the OSM provider [or an
Intermediary if respondent=B2B] or issuescomplaints coming directly from users
Q11 Have you faced any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q111 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q112 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
[Q9 to Q12 should only be asked to representatives of consumer organisations]
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 25 EN
Q9 Can you describe and elaborate on specific issues or complaints your organisation has
been involved in over the past 3 years (or is currently involved in) regarding the control
over marketing format content andor targeting for specific commercial practices These can
be issuescomplaints communicated by the OSM provider an Intermediary a direct B2B
client or issuescomplaints coming directly from users More concretely how were or are
these issues being handled by all parties involved [mention that this includes OSM providers
Intermediary agencies and B2B clients] and how were they eventually resolved
Q10 Are you aware of any actions by enforcement authorities regarding the format or
content of marketing andor user targeting practices What practices was this action related
to [ask the follow-up questions only if the answer is yes]
Q101 Were any specific judicial andor administrative procedures initiated If possible to
comment further what types of procedures [check if the respondent is open to providing
details on the specific case in order to allow us to find the decisions taken decisions issued
by national authorities are usually quite detailed referring to the original consumer
complaints and providing an analysis of the problems so they could be a useful source of
information]
Q102 What was the result of the action taken Please elaborate if possible especially in
view of how specific responsibilities of different parties involved (B2B clients Intermediaries
etc) were allocated [the answers to the two follow-up questions would provide an indirect
tool to check the extent to which enforcement authorities exercise their powers]
Q11 Which of the misleading commercial practices discussed earlier would you consider most
harmful to consumers What potential remedies would you propose based on your
experience at [name of organisation]
Q12 Have you undertaken specific studies or sweeps in this field (marketingcommercial
practices in Social Media) If they are not (yet) publicly available could you share them with
us
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 26 EN
103 Appendix 3 Briefing on misleading commercial practices
What are commercial practices
Commercial practices are actions that companies take to promote or sell their products to
consumers This includes presenting their products showing them describing them or
promoting them in any other way It is also considered a commercial practice to give
information about products or to leave out important information Sometimes commercial
practices are taken up by individuals (eg consumers or celebrities) or by other companies
(such as social media) as on behalf of the advertised company The products concerned may
be goods or services
The UCPD covers commercial practices which are unfair misleading or aggressive All
commercial practices on the ldquoBlack listrdquo3 are always considered unfair In addition the following
paragraph describes which commercial practices are also unfair or misleading
Which commercial practices are unfair or misleading
A commercial practice is unfair if these 2 criteria are met
1 The commercial practice is against ldquoprofessional diligencerdquo
This implies that the trader is dishonest not in good faith or that the commercial practice
in some way constitutes a ldquobad market practicerdquo
2 The commercial practice distorts or is likely to distort the economic behaviour
of the average consumer towards the product
It means that a normal consumer is likely to take a transactional decision which they
would not have taken otherwise This transactional decision entails
- Purchasing or not purchasing a product
- Other economic decisions such as entering a shop or website spending time on
a booking process deciding to buy or not to buy another productservice
The transactional decision need not be distorted in practice but the commercial practice
should be likely (capable) to have such an impact on the average consumer An average
consumer is defined as someone who is reasonably critical conscious and circumspect
though it may be used to refer to the average characteristics of the target audience of
the practice or product
3 Please refer to the black listed practices here or to the list on page 3 httpeceuropaeujusticeconsumer-marketingunfair-tradeunfair-practicesis-it-fairblacklistindex_enhtm
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 27 EN
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
EUROPEAN COMMISSION
Directorate-General for Consumers
2018 EUR 28 EN
104 Appendix 4 Analysis ndash Empty grid used for analysis
The below grid was used to categorise and summarise the findings of each stakeholder
interview
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
Directorate-General for Consumers
2018 EUR 29 EN
HOW TO OBTAIN EU PUBLICATIONS
Free publications
bull one copy
via EU Bookshop (httpbookshopeuropaeu)
bull more than one copy or postersmaps
from the European Unionrsquos representations
(httpeceuropaeurepresent_enhtm)
from the delegations in non-EU countries
(httpeeaseuropaeudelegationsindex_enhtm)
by contacting the Europe Direct service
(httpeuropaeueuropedirectindex_enhtm) or calling 00 800 6 7 8 9 10
11 (freephone number from anywhere in the EU) ()
() The information given is free as are most calls (though some operators phone boxes or hotels may charge
you)
Priced publications
bull via EU Bookshop (httpbookshopeuropaeu)
Priced subscriptions
bull via one of the sales agents of the Publications Office of the European Union
(httppublicationseuropaeuothersagentsindex_enhtm)
top related