There's a new trend on Instagram involving high-profile members doing cash giveaways for potentially morally ambiguous reasons. There are some people with extra money hoping to give it to someone out of the kindness of their hearts, but even from this headline, it's obvious there's more at play here than just kindness. Welcome to the internet.
The cash giveaway trend is most often centered around helping people who may be struggling to make ends meet due to the coronavirus pandemic and the ensuing unemployment issue it has caused. Most of these influencers are not just Instagram stars, either. Relatively big celebrities like Bhad Bhabie, the rapper known for the infamous "Cash me outside" clip on the Dr. Phil show, have done giveaways through Instagram. As with most things related to her, there's something unscrupulous and money-related going on here.
The New York Times may have been similarly suspicious as it has published a story diving into why these giveaways are more than just the trickle-down economics theory finally bearing fruit. To no one's surprise, it's a marketing scheme, however, the depth of the system is more impressive than it is nefarious. There's a decent chance, however, that it may also become illegal.
How Instagram Cash "Giveaways" Work
First, it's worth mentioning that these are not scams. The people who win the cash in these situations do get the prizes they were promised. The shady part about these online events is that they're exactly that – events. Marketing firms like one called Social Stance have constructed a multi-tiered system that benefits just about every person involved.
The influencer in question agrees to run a giveaway event with the firm. The marketers then advertise to investors that they can pay X amount of money for a spot on a finite list associated with the influencer. That list is actually a group of accounts that fans will have to follow to become eligible for the prize. Once the list is full, the firm pays the influencer to run a giveaway of a prize (it's not always cash, but that's an especially effective prize right now as it's the best way to take advantage of people's unemployment struggles). The prize doesn't come out of the influencer's pocket, and they also get a portion of the money those investors paid to get on the list. The investors get a huge influx of new followers, knowing beforehand that those people fit their target market. The fans get a chance at a sum of cash and the validation of supporting some cool influencer who also has a "heart of gold".
It's a win-win-win (win?) but there are some things to be worried about with these situations. The first is that these giveaways play very loose with sweepstakes laws. That fine print on every contest or giveaway is there for legal reasons and these don't have that. It's only a matter of time before one of these scenarios leads to litigation. The second is that Facebook (which owns Instagram) doesn't like that these giveaways are basically a way to buy followers. That sullies the Instagram brand. It's hard to imagine Facebook cracking down on its most popular users, but there could be repercussions. The third point of concern, and maybe this won't matter to some people, is that it's gross. People should feel uncomfortable knowing that their heroes are engaging in these kinds of marketing deals while pretending to be charitable. All influencers use their fanbases to further their own financial goals but most are honest about that.
Source: The New York Times