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Online advertisements that masquerade as non-advertising content posenumerous risks to users. Such hidden advertisements appear on social mediaplatforms when content creators or "influencers" endorse products and brands intheir content. While the Federal Trade Commission (FTC) requires contentcreators to disclose their endorsements in order to prevent deception and harmto users, we do not know whether and how content creators comply with the FTC'sguidelines. In this paper, we studied disclosures within affiliate marketing,an endorsement-based advertising strategy used by social media contentcreators. We examined whether content creators follow the FTC's disclosureguidelines, how they word the disclosures, and whether these disclosures helpusers identify affiliate marketing content as advertisements. To do so, wefirst measured the prevalence of and identified the types of disclosures inover 500,000 YouTube videos and 2.1 million Pinterest pins. We then conducted auser study with 1,791 participants to test the efficacy of these disclosures.Our findings reveal that only about 10% of affiliate marketing content on bothplatforms contains any disclosures at all. Further, users fail to understandshorter, non-explanatory disclosures. Based on our findings, we make variousdesign and policy suggestions to help improve advertising disclosure practiceson social media platforms.

Endorsements on Social Media: An Empirical Study of Affiliate Marketing Disclosures on YouTube and Pinterest