New York, NY – May 29, 2024 – The Children’s Advertising Review Unit (CARU), a division of BBB National Programs, launched an investigation into the YouTube channel “Vlad and Niki,” owned by Content Media Group FZC, LLC (CMG). The investigation, prompted by CARU’s routine monitoring activities, seeks to determine if the channel’s video content and advertisements comply with CARU’s Self-Regulatory Guidelines for Children’s Advertising.
Vlad and Niki is a popular YouTube kids’ channel, directed to preschool-aged children, amassing over 405 million subscribers, 220 billion views, and content across 21 channels in 18 languages.
Of concern are Vlad and Niki’s endorser and influencer videos, which contain undisclosed or inadequately disclosed advertising, endorsements, and material connections in the videos themselves.
Sponsored Videos
CARU observed many Sponsored Videos, meaning videos produced by CMG in connection with brand partnership agreements, for which CMG earns compensation. Though many videos included appropriate disclosures at the beginning, middle, and end of the video, some did not include disclosures at the end of the video in either video or audio. Other Sponsored Videos used language that CARU and the Federal Trade Commission (FTC) do not consider to be clear to children, such as “sponsored by” or “paid promotion” or the “#ad” disclosure in the description box of the video.
CARU recommends that CMG include language, in both text and audio in the video itself that is clear for children to understand, to clearly and conspicuously disclose the material connection to the video’s sponsor at standardized times (beginning and end and, for longer videos, after each ad break). CARU does not recommend advertisers rely on platform disclosure tools, which are often not sufficient to comply with CARU’s Advertising Guidelines regarding clear and conspicuous disclosures to children.
Product Promotion Videos
CARU viewed many videos that CMG calls Production Promotion videos, promoting Vlad-and-Niki-branded products that are produced under various licensing and merchandising agreements, which obligate CMG to produce the YouTube videos and in which CMG shares in the revenue generated by sales of the Vlad-and-Niki branded products.
CARU determined that not only does the relationship between Vlad and Niki’s videos and the advertiser, who is the party of the licensing and merchandising agreements, constitute a material connection, but because CMG is required to produce the videos under the terms of the agreement and shares in the revenue generated by sales of the Vlad-and-Niki branded products, CMG is also considered an endorser of the products.
In each instance, CARU’s Advertising Guidelines require clear and conspicuous disclosure of this material connection. CARU determined that the disclosure “this video features products that Vlad and Niki helped create” is not sufficient or clear to children of the selling intent of the videos and that CMG receives payment from the sales of the Vlad-and-Niki branded products.
CARU recommends CMG modify its disclosures so that they are clear, conspicuous, and understandable to a child, such as “This is an ad for our Vlad and Niki toy,” or “We are selling this Vlad and Niki toy,” when Vlad and Niki are shown playing with or holding up the toys with the Vlad and Niki logo prominently in focus.
Independent Content
CARU observed many videos that showed Vlad-and-Niki playing with various branded toys and in various retail establishments, in which CMG may or may not have an existing relationship. During this inquiry, after CARU educated CMG on its Advertising Guidelines and FTC guidance on disclosures, CMG informed CARU that it has voluntarily, and in the interests of greater transparency to children, decided to add clear and conspicuous disclosures to all Independent Content that features products manufactured by a then-existing brand partner. CARU applauds CMG for taking this additional step to be transparent and protective of children in this popular and evolving world of endorsers and influencers.
In its advertiser’s statement, CMG agreed with CARU’s decision and stated it “will work diligently to comply with the recommendations set forth in the final decision for content distributed on the Vlad and Niki channels.”
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About Children’s Advertising Review Unit: The Children’s Advertising Review Unit (CARU), a division of BBB National Programs and the nation’s first Safe Harbor Program under the Children’s Online Privacy Protection Act (COPPA), helps companies comply with laws and guidelines that protect children from deceptive or inappropriate advertising and ensure that, in an online environment, children’s data is collected and handled responsibly. When advertising or data collection practices are misleading, inappropriate, or inconsistent with laws and guidelines, CARU seeks change through the voluntary cooperation of companies and where relevant, enforcement action.
About BBB National Programs: BBB National Programs, a non-profit organization, is the home of U.S. independent industry self-regulation, currently operating more than a dozen globally recognized programs that have been helping enhance consumer trust in business for more than 50 years. These programs provide third-party accountability and dispute resolution services that address existing and emerging industry issues, create a fairer playing field for businesses and a better experience for consumers. BBB National Programs continues to evolve its work and grow its impact by providing business guidance and fostering best practices in arenas such as advertising, child-and-teen-directed marketing, data privacy, dispute resolution, automobile warranty, technology, and emerging areas. To learn more, visit bbbprograms.org.
Contact Information:
Name: Jennie Rosenberg
Email: jrosenberg@bbbnp.org
Job Title: Media Relations
