On July 17, Han Hye-yeon, a famous stylist who runs her own YouTube channel, apologized to her subscribers amid claims that some of her videos contained hidden advertising. She had posted many videos in which she would introduce new shoes, clothes, and various fashion items. In these clips, she emphasized that the recommended items were not from sponsors but rather purely her own choice. However, it turned out that these products had all been sponsored, despite the channel being described as “the area completely free of ads” by Han herself.
“Nothing hurts more than being disappointed by the single person you thought would never hurt you.” This summer, numerous people witnessed their long-held trust being shattered to pieces due to backdoor advertising of the YouTubers they had previously trusted. As the case of Han Hye-yeon explains, backdoor advertising refers to hidden advertising that superficially appears to have no business ties with sponsors. It leads those exposed to the videos or faithful subscribers into thinking that the items introduced or discussed are trustworthy as they are the pure choice without any commercial intentions by YouTubers whose decisions can be trusted.
In addition, some YouTubers have stumbled into trouble by placing advertisement notifications in places where it is rather difficult for subscribers to notice — such as in the description box, where a viewer has to click the “More Below” button to read the description. Both actions — not indicating that the video is sponsored or hiding the notification in an unseen spot — are usually intended to deceive the audience. Those actions result in disorder in the markets by deceiving consumers and undermining basic trust, essential to the sound market systems.
The Fall of the Trusted YouTubers
Indeed, backdoor online advertising has stirred up public anger, especially because several of the YouTubers involved in this controversy were originally considered honest and considerate of their subscribers. On August 4, one of the most influential and famous YouTubers with nearly 4.5 million subscribers, Moon Bok-hee, posted an apology letter for her past backdoor advertising. In addition to admitting that “there were many videos without any indications of advertisements,” she also revealed that she had placed several advertisement notifications in the “More Below” description section.
YouTube has been considered an area where there are relatively few governmental interventions compared to other forms of media broadcasting. Thus, backdoor advertising has taken advantage of this trait to maximize the promoting effects. Corporate entities believe that the viewers will be more likely to embrace a product if they do not recognize that it is being directly advertised to them. Also, a candid indication of paid advertisements can negatively influence the number of views — a critical determinant of the profit — and the reputation if the subscribers believe that the YouTuber is excessively pursuing financial gains.
All the factors — lack of related regulations, increased benefits of both the sponsors and the YouTubers have led to the prospering of backdoor advertising on YouTube. Lack of transparency, a stark trait of new media, has rendered these shady acts nearly impossible to spot. Truths about this form of advertising would have forever evaded the public attention had it not been for some YouTubers who stepped out to disclose the illegal acts. On August 3, YouTuber Cham PD revealed that many Mukbang YouTubers have been deceiving their fans with backdoor advertising. Being a Mukbang YouTuber himself, he exposed the disadvantages that honest YouTubers like him face due to many YouTubers resorting to deceit.
The Appearance of Relevant Regulations
In response to the public anger, the Fair Trade Commission (FTC) has revised its advertising guidelines concerning advertising on social media platforms. The new measures becoming effective this September would obligate a strict and clear indication of advertisements. Violators will be inflicted with a fine amounting to two percent of related sales or 500 million won.
However, according to Professor Shin Jongchul (Graduate School of Information, Yonsei University), the execution of the newly announced measures would be difficult considering the subtle nature of backdoor advertising. He explained that new platforms like YouTube merely circulate backdoor advertising rather than producing one, which complicates the matters in holding the platforms themselves accountable.
On the relevant cases, he mentioned The Communications Decency Act of 1996 of the U.S., which did not punish the online platforms with illegal video contents unless the platforms provided the financial incentives to post such contents or substantially assisted in the illegal acts. Even though the regulations contributed to the protection of freedom of speech in the online area by not holding the platforms legally accountable, the professor argued that a different approach is needed in this case of backdoor advertising. That is, a stricter push for transparency as a form of legal sanctions should be implemented to further deter any acts of deceit against consumers.
Professor Shin also underlined the importance of ethical standards in new media platforms like YouTube. As a solution, he suggested that the government impose each platform the responsibility of self-regulating and legally sanction the ones that fail in the given duty. He said, “The autonomous responsibility granted to each online platform should be accompanied by strict execution of laws and financial punishments that remove any gains or incentives to engage in any illegal acts of deceit.” However, he expressed that any prior censure of the contents on online platforms should be carefully dealt with, as it could lead to violation of freedom of speech mentioned in the constitution.
Trust is considered to be one of the most crucial factors in establishing sound commercial relations. In this case, Internet users have witnessed how easily trust can be broken by the greed of YouTubers. Thus, there should be stronger and more sophisticated laws to prevent the undermining of basic trust in a reliable market. It undoubtedly remains the obligation of lawmakers to introduce judicious regulations to reestablish trust and punish those who taint sound economic activities with deceit and tricks.