Turning Trust to Transactions: Tracking Affiliate Marketing and FTC Compliance in YouTube's Influencer Economy

TL;DR

This study analyzes the prevalence and compliance of affiliate marketing disclosures on YouTube, revealing widespread use but low adherence to FTC standards, and suggests platform features can improve transparency.

Contribution

Introduces new tools leveraging Web measurement and NLP to assess affiliate marketing and disclosure compliance on YouTube using a large dataset.

Findings

Affiliate links are common on YouTube videos.

Most videos do not meet FTC disclosure standards.

Platform features can improve disclosure compliance.

Abstract

YouTube has evolved into a powerful platform where creators monetize their influence through affiliate marketing, raising concerns about transparency and ethics, especially when creators fail to disclose their affiliate relationships. Although regulatory agencies like the US Federal Trade Commission (FTC) have issued guidelines to address these issues, non-compliance and consumer harm persist, and the extent of these problems remains unclear. In this paper, we introduce tools, developed with insights from recent advances in Web measurement and NLP research, to examine the state of the affiliate marketing ecosystem on YouTube. We apply these tools to a 10-year dataset of 2 million videos from nearly 540,000 creators, analyzing the prevalence of affiliate marketing on YouTube and the rates of non-compliant behavior. Our findings reveal that affiliate links are widespread, yet disclosure compliance remains low, with most videos failing to meet FTC standards. Furthermore, we analyze the effects of different stakeholders in improving disclosure behavior. Our study suggests that the platform is highly associated with improved compliance through standardized disclosure features. We recommend that regulators and affiliate partners collaborate with platforms to enhance transparency, accountability, and trust in the influencer economy.