A woman looks at the Instagram page of a Saudi influencer in Dubai on April 7, 2020. (PHOTO / AFP)

A new licensing system in Saudi Arabia, aimed at monitoring the country’s growing content creator and influencer industry, will be a win-win for all, according to experts.

They said it will encourage more transparency and consumer protection in a largely unregulated sector.

The move follows an announcement by the Middle Eastern country in June that non-Saudi residents and visitors who post ads on social media without a license would face prison and a fine of up to US$1.3 million.

The move follows an announcement by the Middle Eastern country in June that non-Saudi residents and visitors who post ads on social media without a license would face prison and a fine of up to US$1.3 million

Saudi Arabia is the latest to join the likes of the United States, the United Arab Emirates, the United Kingdom, South Korea, Singapore, and Japan, which have taken measures to regulate content creators and influencers in light of an ever-increasing number of individuals and businesses transacting and sharing data online.

Starting in October, Saudi and non-Saudi content creators in Saudi Arabia earning revenue through advertising on social media platforms are required to first apply for a permit through Saudi’s General Commission for Audiovisual Media or GCAM.

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Jeddah-based English language newspaper Arab News reported that for a fee of roughly US$4,000, content creators will receive a permit, valid for three years, during which time they can work with as many private entities and promote products or services that do not run counter to Saudi’s laws or values.

Joe Ghantous, founder at Right Service, a digital marketing agency in Riyadh, with branches in Lebanon, the UAE and Jordan, welcomed the new licensing system as it “will positively affect the growth of influencer marketing in the Kingdom of Saudi Arabia”.

Ghantous is also founder of the Middle East Social Media Festival and likewise of the Social Media Influencers Association, which was launched in 2018 in Lebanon by Right Service, with the aim of creating a positive impact on society and “helping the world to be a better place” in addition to guarding and protecting influencers’ rights.

“(The license) will regulate this industry and keep those who have a real and positive impact on society. Still, it must be accompanied by supportive and developed regulations and measures that help these real influencers to grow their knowledge and (have a) positive impact on Saudi society and protect their rights,” Ghantous said.

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According to online, market research and business intelligence portal Statista, the global influencer marketing platform market is expected to surpass US$370 million in 2027.

 According to the Saudi Arabia Social Media Statistics published in June by Global Media Insight, a digital marketing company headquartered in Dubai, data showed that almost 98 percent of the Saudi Arabian population of 35 million use the internet in 2022 and that 29.50 million are social media users.

The report also covered web traffic referrals from social media or social media referrals.

“Since 32.60 percent of internet users in Saudi log in to social media for making purchases, investing in social media can turn out to be a successful bet. In 2022, Facebook is the best platform for advertisers and marketers. With 63.23 percent referral traffic, it is three times more powerful than Twitter in driving traffic to websites,” the report reads.

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“Twitter is the second most promising platform for marketing. It is able to generate 21.85 percent of web traffic. Third position is held by YouTube with 6.41 percent. Other platforms like Instagram and Pinterest are responsible for only 4.05 percent and 2.5 percent of the web traffic respectively,” it added.

Compared to 2021, there was a 1.51 million increase in total internet users this year while daily internet usage jumped by 20 minutes, making the Saudis’ current daily average time spent on the internet at eight hours and five minutes.

Glenn Wijaya, an associate at Christian Teo & Partners and an expert on Indonesia's Electronic and Information Laws said that the rising number of regulators around the world who are now concerned with social media influencers’ activities is good for transparency and consumer protection.

“I highlight that many social media users are sometimes confused whether or not an individual is giving an honest review of a product or service or is endorsing a product or service. Social media users, who are prospective consumers, are not well protected against scams made by unruly social media influencers,” said Wijaya.

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“By way of requiring social media influencers to be registered, at least regulators then could track who endorses what brand. (The) liability of these influencers then can also be ascertained, and I think at the end of the day, it is a win-win situation for all, i.e. the brand owner, the influencer and the public or consumers,” he added.

jan@chinadailyapac.com