Very few celebrities have risen quite as fast or as high as Chiara Ferragni, Italy’s top influencer. Controlling an empire worth several million euros and claiming over 29 million followers on Instagram, Ms Ferragni is a household name. She rose to fame with strokes of branding genius such as her logoed Evian water bottles (sold at €9) and the creation of the Ferragnez brand, which merged her name with that of her celebrity rapper husband, Fedez. At one point even the Italian government paid for her services, buying her influencing power to entice young people into the country’s museums. Suddenly, last Christmas, the fall from grace: Italy’s regulator fined Ms Ferragni €1 million for misleading consumers in her pandoro (a popular Christmas cake) charity campaign.
The Italian Competition Authority, AGCM, argued that the Pandoro Pink Christmas campaign led consumers to believe they would be adding their own donations to a Turin children’s hospital each time they purchased a logoed pandoro at nearly 3 times the standard price. In reality, the manufacturers had made a one-off donation several months before the campaign and the premium price had netted the influencer over a million euros. As all printed and social media communication from both influencer and manufacturer (wrongly) led consumers to believe their purchase would contribute to the donations, AGCM decided to punish both: Ferragni’s companies were fined just over €1 million and Balocco, the pandoro manufacturer, €420,000.
The Pandoro Pink Christmas campaign led consumers to believe they would be adding their own donations to a Turin children’s hospital each time they purchased a logoed pandoro at nearly 3 times the standard price.
Despite immediate apologies for ‘having made mistakes’ and her pledge to donate €1 million herself to the cause, Ms Ferragni lost around 157,000 followers and at least two of the leading brands sponsoring her, Coca-Cola and Safilo. Many others are allegedly evaluating their relationship with Ms Ferragni. The faux pas made headlines for weeks on end, while Ms Ferragni’s Instagram account became uncharacteristically quiet. The government, once again, took note. Italian Prime Minister Giorgia Meloni made reference to the influencer’s lack of clarity in one of her speeches and a legislative decree on transparency for charity initiatives was tabled in parliament shortly afterwards.
The new ‘Ferragni law’ provides some clarity in an area that previously had no specific regulation. To avoid misleading consumers, the products linked to an influencer’s charity activity must state clearly on their packaging the purpose of the charity initiative, the beneficiary and the overall amount or percentage of the retail price which will be passed to the charity. The organisers of any charity promotion also need to alert the AGCM and report the timeframe within which the charity donation is to be transferred to the beneficiary. The competition authority can issue fines of up to €50,000 and, in the event of repeat offences, ‘suspend’ the offending influencer’s business for up to a year. Influencers who have been fined for breaching these rules also need to post the fine on their website. All’s well that ends well, it seems: as it is all about charity, fifty per cent of the collected fines are donated to charitable causes.
