Social Tip plans to reinvent social media marketing by rewarding everyday users for posting about their favourite brands.

The problem the platform is looking to solve is that some everyday Instagram users have greater engagement rates than many micro-influencers, yet brands struggle to mobilise these positive reviews and posts made between friends and family.

“This is good old-fashioned word-of-mouth marketing for the digital age and scalable through our innovative technology,” says Watt.

Social Tip’s algorithm calculates the value of a post based on views and engagement, and makes payment to the poster’s Social Tip account by way of a cash reward from the brand.

Pre-launch, Social Tip has 30+ brands onboarded including Trip, Tallow + Ash, JERMS, Pure Gym, Slug & Lettuce and, of course, BrewDog.  

Will a post be deemed an ad?

The Advertising Standards Authority (ASA) is the UK’s regulator of advertising. The CAP Code, enforced by the ASA, applies to influencer marketing and ensures that people know when they are being advertised to.

Under the CAP Code, a post will be deemed an advertisement if the brand has:

• ‘paid’ the content creator in some way; and

• had some form of editorial ‘control’ over the content (which can be just having final approval).

The cash reward paid to the user on the Social Tip platform will be considered ‘payment’, but, from the preliminary information that we have about the platform, it doesn’t sound like the brand will have any form of ‘control’ over what the users are posting.

No such thing as bad publicity?

Without having any control over the content of posts, brands run the risk of rewarding users who are saying negative things about their products.

This risk is especially high given that some of the most harmful content on social media attracts the highest level of engagement.

Traditionally, when a brand works with an established influencer they will put a contract in place that protects the brand by giving it the right of final approval over the content before it goes lives and allowing the brand to terminate the contract should the influencer bring the brand into disrepute. This means the brand has the comfort that what is going to be said about them is positive.

What will the regulator say?

If the brand is going to have some approval over the content, it will be deemed an ad and will be regulated by the ASA. If this becomes the case, there are still a number of unanswered questions about the platform and how the ASA will attempt to regulate it.  

The impact of such posts being regulated is that under the CAP Code, the post ‘must be obviously identifiable’ to consumers as an ad with the content including an ‘AD’ or ‘Paid Promotion’ label upfront.

At the moment, the ASA tries to ‘name and shame’ those influencers who fail to comply with the regulations but, with no public profile, this may not be an effective stick for the general public.

Further, if the brand is selling age-restricted products such as gambling products or alcoholic drinks, they are prohibited from working with content creators whose target audience is under this age of 18.

Whether Social Tip will be able to establish the likely age range of followers of its users is still unknown and could result in brands unlawfully working with users to promote age-restricted products.

Will the brand be allowed to use the post too?

Usually, an established influencer grants the brand a licence to use and reshare the content they have made and it’s likely that brands will want to use powerful social media posts created by everyday users in the same way.

Therefore, Social Tip may require users to agree to granting this usage right to brands when they sign up to the platform, but the question remains whether users will want to.

The end of influencer marketing as we know it? 

“No-one believes that celebrities or the biggest TikTokers and YouTubers just happen to be really into a brand. That’s why the power of conventional influencer endorsement is limited and dwindling,” says Watt.

The influencer marketing industry is expected to grow to $24 billion this year.

According to ‘The 2024 Influencer Marketing Report’, almost half of all consumers (49%) make purchases at least once a month because of influencer posts; and almost all consumers (86%) make a purchase inspired by an influencer at least once a year.

There is no doubt that when the brand and influencer relationship doesn’t fit, the paid-for content feels clunky, insincere and the viewers don’t believe what the influencer is saying.

But will it be worth the risk for brands to encourage their customers to create content about their products without having any control over what is said?

When a brand formally partners with an established influencer who has an engaged and loyal audience, they can work collaboratively on the brief and allow the influencer to be the expert in creating content which their specific audience will love and trust. As the stats show, the results from this type of relationship are phenomenal with fewer of the risks, so it remains to be seen if this new, riskier alternative will succeed.