The Advertising Standards Authority in the UK has banned Floki Inu advertisements, claiming that the ad “irresponsibly exploited consumer’s fears of missing out, and trivialized cryptocurrency.”
Floki Inu poster adverts were initially seen along the London Underground, each sporting a graphic of an animated dog wearing a Viking helmet. The large, bold text reads, “Missed Doge? Get Floki,” while smaller text cautioned the public that their investments might go up and down in value, emphasizing that cryptocurrency is not regulated in the UK.
The ASA believes that the use of the Shiba Inu cartoon dog and the bold statement took advantage of consumers’ “fear of missing out (FOMO),” downplayed the risks of cryptocurrency investment, and exploited the inexperience of consumers. In its defense, Floki Ltd., trading as Floki Inu, said they had submitted the advertisement to the Committee of Advertising Practice and received approval from the committee before displaying the ads.
They did not consider the logo as trivializing investment product and that it was their corporate logo. The community felt that, had the Elon Musk-inspired logo been omitted, consumers would be in the dark about the company behind the advertisement. The ASA acknowledged this, but remained adamant that the use of a cartoon image trivialized the investment.
Are you an “informed consumer?”
Floki Inu said that many cryptocurrencies start from jokes or memes, claiming that the intended audience for the ad was the “Informed Consumer.” This “Informed Consumer” supposedly was knowledgeable about the crypto market, how it worked, and the inherent risks of investing. The UK watchdog shot down the “informed consumer” hypothesis, arguing that cryptocurrencies high profile, topical presence in the media was enough to make even relatively uninformed consumers curious, with the presence of the ads at London transport poster sites.
Floki claimed that the warning concerning the potential for losses was aimed at the general consumer who would see the ad phrase “Missed Doge, Get Floki, as a wordplay, but require further investigation to understand the advertisement properly. Regarding the size of the warning text, the ASA believes that it was too small, and that the overwhelming message communicated by the ad was the need to buy Floki.
According to the ASA, marketing Floki Inu using the phrase, “Missed Doge? Get Floki,” implied that Dogecoin was in the same category, leading consumers to believe that Floki Inu would show a similar uptrend in price. Floki Ltd. claimed that it did not tout crypto as a superior investment or foster an urgency for a consumer to invest right away.
The ASA said that since cryptocurrency is a relatively new product, the public was not likely aware of the tax that needed to be paid. The body also pointed out that there was no information on Floki Inu’s website on paying CGT. The Floki community claimed that it was not informed about the possibility of Capital Gains Tax being levied on cryptocurrency investments, which would have necessitated a mention in the advertisement.
Similar Floki Inu ads banned by the watchdog
The ASA said that the advertisement should not appear in the same form in the future. They admonished Floki Ltd. not to exploit fears of missing out, not trivialize crypto investments, and inform consumers of the potential of paying CGT on cryptocurrency gains, pursuant to rule 1.3 and 14.1 of the CAP Code: “Marketing communications must be prepared with a sense of responsibility to consumers and to society,” and “Offers of financial products must be set out in a way that allows them to be understood easily by the audience being addressed. Marketers must ensure that they do not take advantage of consumers’ inexperience or credulity.”
Floki said they had covered every base of the CAP code and ASA requirements before launching the campaign, feeling that the UK watchdog acted unfairly by revising guidelines and retroactively applying them to Floki Inu ads. They, however, have committed to using the ASA’s revised guidelines for future campaigns.
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