>> Asha: This is Marketplace.
The murky new world of celebrity endorsements.
>> Which way did he go? >> Asha: To the left.
Looking for Kim K and her famous reality TV family.
Millions of followers, dozens of daily posts.
>> It's the wild West out there right now with social media and advertising.
>> Asha: But are they letting you into their lives? Or just cashing in? >> About $75,000 for a single post.
>> Asha: An old game with a new trick.
And why many of us fall for it.
>> We should know that we are being sold something.
>> Asha: This is your Marketplace.
[ ♪♪ ] >> Asha: We're in Los Angeles.
We think we've spotted Kris Jenner's boyfriend, Corey Gamble in his red Ferrari.
Hanging out with a certified star tracker.
>> This is how we do it in the paparazzi business.
>> Asha: We're trying to keep up with the Kardashians.
>> At least he's not in the car, so that's good, but he's parked illegally.
Taking up two spots.
So, it's going to go down soon.
>> Asha: There he goes.
We are hoping we're hoping the boyfriend leads us to the pack.
>> Which way did he go? >> Asha: To the left.
We got this.
We've got some big questions to ask them about their product peddling.
>> Oh, dammit.
Which way did he go? >> Asha: He's gone.
>> We tried.
It could pop up again.
>> Asha: We've lost our lead but the Kardashians are easy to find online, everywhere.
Kourtney K, 48 and a half a million followers on Instagram.
1 million, and Kim, a whopping 86.
6 million followers.
They ooze a lot of star power on social media.
Between photos of their cute kids and nightclub hopping, there are pics like this.
Are they sneak peeks into the Kardashian lifestyle? Or product plugs? It's hard to tell.
But we are we're on a mission to find out.
Let's start with this post.
You know, sisters, just chilling.
Wearing their waist trainers? From Kourtney, to Khloe, to Kylie to Kim.
These posts go a long way in the murky new world of advertising.
[ ♪♪ ] >> Oh, is that a waist trainer? >> Asha: Who have you seen wearing this? >> Ah, Kim K, yeah, Kim Kardashian.
>> Oh, my God.
I know that Kim Kardashian has worn it, I think, to make her waist look all tiny and her butt big.
>> Asha: Do you know what this is? >> That's the famous waist trainer, right now.
So you can get a waist like this.
>> Asha: All right, girl! Which celebrity do you know wears one of these? >> I know the Kardashians, I mean, I see them posted on Instagram all the time.
[ ♪♪ ] >> Asha: Their posts aren't just friendly updates.
It is all about turning followers, views, and likes into dollars and cents.
To learn more about that money game, we drop in on a social media expert and his fashion blogger client.
>> Typically, with Instagram, the kind of sweet spot is two posts a day.
The trick is actually if you do two posts right in a row.
>> Really? >> Asha: That's Frank Spadafora.
He runs D'Marie archive, helps companies decide who to pay to promote their brands.
That means understanding the influence of celebs online.
>> The Kardashians still, kind of, reign supreme.
They've been doing this the longest.
And, you know, when it comes to figuring out how to transition from reality TV stars into business women, they've done a good job at it.
>> Asha: What's the average for a Kardashian post? >> Their values range anywhere from, on the low end, about $75,000 for a single post across Facebook, Twitter, and Instagram, all the way up to about $300,000.
>> Asha: Yep.
Companies are willing to pay big bucks to reach Kardashian followers and their wallets.
>> How much would the brand have to pay to get that same reach? That is what we are calculating.
>> Premadonna waisting society.
>> Asha: Okay.
So these sisters could be making some serious coin on this waist trainer.
>> My bombass gel, for that stubborn extra fat.
>> Asha: Besides molding you into that hourglass shape, the trainer, supposedly makes you sweat out toxins and lose weight.
This man thinks the Kardashian posts are bunk.
>> This is about celebs and all the ridiculous things they endorse.
>> Asha: Timothy Caulfield is a professor of health law, loves science, and has some real pop culture cred.
He wrote the book, "Is Gwyneth Paltrow Wrong About Everything?" Look, look, I can hook one.
>> I would offer help, but.
[ Laughter ] >> Asha: This is, like, impossible.
>> It's a girdle.
That's basically what it is.
>> Asha: Why would they want to endorse a product like this? >> Because they are known for their bodies.
You know, they are the perfect people to endorse this kind of product.
We don't know if they actually use it, but, you know, you see these Instagram pictures.
I know the famous one Kim, you know, she took of herself.
And, I'll tell you, I bet it moved a lot of product.
>> Asha: It sure did.
Millions of dollars worth.
Caulfield thinks celebrities post fake glimpses into their lives to make us fall for their product pitches.
>> And it's all curated to look as if we're, you know, catching them in a spontaneous moment, when in fact, it's an advertisement, right? >> Asha: So, do you think when the celebrities post these ads on social media that the public knows this? >> I don't know if they realize the degree to which it's often a straight up advertisement.
Because one of the things I think they want to achieve, is this illusion of spontaneity.
This idea that you're looking at Kim's real life, right? And, because that makes it seem more like a genuine endorsement, right? >> Asha: Do the sisters simply strike a pose with those waist trainers? Do they get paid to promote them? We think Kardashian fans deserve answers.
>> I just think the celebrity culture, I mean, you probably sent it to.
It's becoming bigger, and bigger, and bigger.
It's having more and more influence.
It's getting closer and closer to us.
It's really having an impact.
>> Asha: We want to talk directly to the Kardashian's.
We write and call Kim's people but we are told she is too busy to talk.
And no response from family momager, Kris Jenner.
[ ♪♪ ] >> Asha: So that's why where in LA with paparazzo, Giles Harrison.
We're going to cruise for celebrities, huh? >> Yeah, definitely.
So, you want to hop in and we can get going? >> Yeah.
>> Asha: This is a nice ride.
>> I like it.
>> Asha: Okay.
Let's do this.
[ ♪♪ ] >> Asha: Giles is our best bet is to find the Kardashians.
He's been in the biz for decades.
>> There is a gym that Khloe and Kris go to that's in Beverly Hills.
[ ♪♪ ] >> Asha: Do you think it's interesting that she promotes the waist trainer on social media but she doesn't talk about it at all in her magazine spreads or — >> Because she probably doesn't wear it.
She lost a lot of weight.
>> Asha: Yeah, I know.
>> Because she was never really the ugly sister, but she was kind of the chunky sister, right? >> Asha: There's the gym.
No sign of Khloe.
We continue to cruise.
And follow all the sisters social media moves.
Then, a hint from Kourtney on Snapchat.
>> We're, like, having a Snapchat off.
>> Asha: If you see a group of kids in white Tshirts.
Where though? Selling lemonade, iced tea on the side of the road.
Kourtney was there about 15 minutes ago.
>> That could be anywhere.
>> Asha: Yeah, where's that? >> That could be anywhere.
>> Asha: We swing by Melrose and ride right into this.
>> There is a whole bunch of paps.
>> Asha: Could it be one of the Kardashians? [ ♪♪ ] >> Asha: False alarm.
>> Jenna Dewan Tatum.
She's married to Channing Tatum.
>> Asha: Jenna's galpals with the sisters.
Alas, she's alone today.
[ ♪♪ ] >> Asha: We check out Kim K's nail salon, no luck here.
[ ♪♪ ] >> Asha: Still in search of answers, we contact this woman.
>> Basically, you put this shaper on and you wear it for four hours a day.
>> Asha: She's behind the "Waist Gang Society", the brand the Kardashians promote.
And she claims she doesn't pay her pal Khloe or any sister for the ringing endorsements.
>> How much money you making off that thing? >> A lot.
[ ♪♪ ] >> Asha: As for our Kardashian search.
The closest we get, is their soon to be sister in law, Blac China.
And, surprise, surprise, she wears a waist trainer to.
[ ♪♪ ] >> Asha: Posting about prescription drugs.
>> Holy cow, did she cause a storm! >> Asha: Fact check, on your marketplace.
Got a story you think we should investigate? Email us at [email protected]
[ ♪♪ ] [ ♪♪ ] >> Asha: Checking in with your celebs on your Marketplace.
>> Kim, over here! Kim! >> Asha: Millions of people have followed Kim Kardashian's journey to motherhood, thanks to paparazzi, her reality show.
>> Kim, how are you? >> I'm good, how are you? >> I'm good.
>> I'm starting to get that.
>> Asha: And the red carpet.
>> I have the worst morning sickness, day sickness, night sickness, I can hardly get out of bed.
So it's definitely a different type of pregnancy than my first one.
>> Asha: Kim suffered morning sickness during her second pregnancy, which she says was treated by this.
It's a drug made by a Canadian company.
"OMG", says the post, "Have you heard about this?" The casual tone makes it look like a friendly tip to her followers on Facebook, Twitter, and Instagram.
The thing is, it isn't a tip.
It's a paid ad and it makes headlines.
>> A popular social media celebrity has run afoul of the law.
Blurring the line between promoting her brand and pitching a product.
>> Asha: Kim's post leaves out any mention of the medical risks, but that information is required by US law and must be included in every American drug ad.
Instead, all Kim does is add a link to that very important risk information.
>> Holy cow, did she cause a Storm, right? This is an ad and it really doesn't have the feel of a traditional ad.
>> Asha: Even health law and policy professor, Timothy Caulfield, is stunned by that move.
>> Using social media to market a drug, to market a drug, right? You know, again, she has, you know, tens of millions of followers so this is serious stuff.
Very powerful marketing strategy.
Imagine if you could reach that many followers, that quickly, right? And in a powerful format.
So, look, the FDA, the regulators took notice and said this is not appropriate.
So, a lot of interesting things going on here.
[ ♪♪ ] >> Asha: The FDA is the US food and drug administration and it says the post must come down.
They break the rules.
They are false and misleading and that link, not good enough.
>> Did it hurt her brand? No.
When you're a celebrity for being a celebrity, any noise is good noise, right? And then for the drug company, they got a huge amount of exposure.
>> Asha: He's right.
People sure heard about it on TV.
>> Kim Kardashian is pregnant with her second child.
And this time she's making money from it.
What drug should we take if we get sick of the Kardashians? Is there any.
>> Asha: And online.
Her post generates nearly half a million likes before it's replaced by one with that risk info, using the hashtag CorrectiveAd.
Kim's OMG tone breaks away from the company's old school messages on YouTube.
>> A new, prescription, pharmacological option for pregnant women suffering from nausea and vomiting in to pregnancy.
>> Asha: Which one is more appealing to you? We reach out to the drug company Duchesnay.
They tell us they fully approved Kim's script.
They did pay her but they won't say how much.
And they thought the link satisfied the law.
So was the rule breaking worth it? Business at the pill maker seems to be booming.
The company is doubling production space because of rising demand and a full backlog of orders for its morning sickness drug.
Coincidence? >> I don't think so.
That must be the Kim K bump, right? That's remarkable.
And again, really shows you we can't attribute it all to Kim Kardashian's post, but it really shows you, I think, the power of these kinds of celebrity endorsements.
[ ♪♪ ] >> Asha: That star power is too much for these tourists in LA.
>> I'm really not into stars promoting any kind of pharmaceuticals.
>> Asha: Why? >> Because I think that should be left to doctors to do.
>> You should just follow the rules or else it's just going to blow up in your face.
>> Pharmaceuticals I think are a tricky area to be promoting on social media.
>> Asha: Social media guru, Frank Spadafora, says Kim's drug deal is a game changer.
>> Her and her agents have definitely, kind of, tested the waters.
>> Asha: Do you think celebrities in general should endorse pharmaceuticals? >> If it works for them and if they disclaim all of the risks, I absolutely think that pharmaceutical has a place on social media for endorsements deals.
>> To your right! Kanye, Kim, to your right? >> Asha: Did Kim really use the drug? Why didn't she post the risks? And how much was she paid? We've made several requests for an interview to ask those questions, her reps say Kim is too busy.
[ ♪♪ ] >> Asha: We're not giving up though.
And continue our search for some answers.
We wait at one of Kim's lunch spots, Nosho.
Paparazzi know the Kardashians dropped by their Dash boutique.
So we check it out.
We've been trying to get in touch with them, we want to talk about celebrity endorsements.
>> I'm going to have to ask you to take your camera outside, because there's no filming allowed in here.
>> Asha: We get kicked out in a dash.
An old game, with new tricks.
Can you spot the difference? >> Umm.
>> Asha: Luring you in with all that bling.
It's your marketplace.
Sign up for our newsletter at cbc.
>> Asha: Browsing your feeds? Fact check, on your marketplace.
Seems like the Kardashians are obsessed with a bunch of shiny new products on social media.
From waist trainers, to hair vitamins, to teatoxes.
Easy to spot adds when they're on a billboard, but not so easy when they're on your smart phone.
So, can fans separate the paid Kardashian posts from the regular ones? To find out, we hit the streets.
We are going to play ad or not an ad? Are you ready? >> Yeah.
>> Asha: Here we go.
>> Not an ad.
Not an ad.
>> Asha: It's not just the photos tripping people up, it's the captions too.
>> A little Saturday morning waist cinching and working on my posture, while cleaning out my closet.
>> Asha: So you feel like this is the real deal? >> I guess so, yeah.
>> It's just a wig.
Looks so real though, right? >> Looks so real, though.
>> She's promoting stuff, right? >> Oh.
>> She's promoting, like, wigs and.
>> It's an ad? >> Asha: Which one do you think is an ad? >> This one.
>> Both, I think both.
Because of the wig, too.
>> Asha: What about this? >> I'm really obsessed with the waist training.
I think she's just showing off her body at home, just casually.
>> Asha: Is this an advertisement? >> It most definitely is.
>> How do you know it's an ad, though? >> To be honest, you don't, I mean, and to the regular eye, I mean, people might think she's just endorsing something she likes.
>> Asha: Can you tell the difference? >> Umm, she's just in her closet, so it seems a little bit, I guess, casual, like, people take selfies in the bathrooms are in their closets, so.
>> I like the fact that there is a little baby toy with the little hood.
>> That's the only one I got wrong? >> Yeah.
[ ♪♪ ] >> Asha: Feeling dazed and confused? Our expert says that's the whole point.
These images are carefully crafted for the new age of advertising.
>> It's all about the reach.
It's all about being close to the consumer.
Social media does that, right? That's the big.
You know, it's not Grace Kelly in life magazine, it is Kim Kardashian on your phone, talking to you, right? It's a way different world than it was in the past.
And really seems like its the wild west out there right now with social media and advertising and the leveraging of celebrity.
It's really going to be interesting to see where this all goes.
>> Asha: There is an American consumer group trying to taint that wild West.
It's called "Truth In Advertising", and it's going after the Kardashians.
The group says there is deceptive marketing all over the reality stars' social media feeds, including those posts about their favourite waist trainer.
So, the group complained to the Kardashians and to the Federal Trade Commission saying the famous family is violating government guidelines.
Those guidelines say, "Paid endorsements on social media must be stated in a clear and conspicuous way.
" "It should be easy to notice.
" The hashtag "Ad" or "Spon" should be the first thing people see.
>> It's a fine line and, you know, social media followers are not stupid.
They can kind of smell it from a mile away.
>> Asha: Our social media expert, Frank Spadafora, says its best for everyone if celebs are up front.
>> We statistically see that when you just put the hashtag "Ad" or hastag "Sponsor" that you get a lot less negative feedback from your fan base.
Social media, somehow, it's got this bad rap for having sponsored content and as long as it's, you know, clearly displayed I don't think it's an issue.
>> Asha: We've been monitoring the Kardashian family posts since that complaint and guess what? They've been updating their social media feeds with this.
Confirming that a whole lot of those posted products have always been paid endorsements.
[ ♪♪ ] >> Asha: We break that Kardashian news on the streets.
When you look at this message, what do you see? >> Hashtag "Ad".
>> Asha: Right away, you know.
Take a look right there, before.
>> Hashtag "Ad".
>> See that, that is the difference.
I didn't even notice it.
>> We should know that we are being sold something.
>> Asha: The Competition Bureau of Canada says it's monitoring deceptive ads online and there are fines.
But we're not seeing the same hashtag "Ad" crackdown like the one stateside.
>> I always thought Canada was more involved, just when it comes to like, notifying consumers of their rights.
>> Asha: Do you think there should be more monitoring and enforcement? >> Totally.
>> There should, there should.
>> Asha: Why? >> Because I feel like celebrities like her have one of the major influences to people who are like us who are on social media every single day and are seeing these things and are exposed to these things.
>> We know, like they do anything for money, so like, we ought to know, you know, what they're getting paid for to trick us into buying.
>> Asha: It may be lucrative but the Kardashians social media game has a downside.
>> Paris fashion week turned ugly for Kim Kardashian last night.
>> Asha: Just days after posting this snapshot of her multi-million dollar jewellery, Kim was robbed at gunpoint in a luxury Paris apartment.
Since then, her feeds have gone dark.
Kim has been radio silent.
But her sister Khloe reveals on "The Ellen Show", the family is reevaluating things.
>> Everybody is on social media, everybody's Instagramming and tweeting and constantly.
And everything is shut down now? >> Well, I think it's just a wakeup call to make a lot of life adjustments but this is a really serious matter, you know, for Kim.
>> Asha: Sometimes social media just gets to personal.
Even for a family who's built a big business on over sharing.
>> Coming up on Marketplace.
>> Asha: We're showing you what a lot of companies can access from your phone every day.
>> Putting your privacy to the test.
>> Asha: We also had access to your camera phone.
>> What? >> It's really the perfect spy tool.
>> It's your data.
Don't just give it away.
>> I'm in shock.
>> And, are you ready for this trip.
>> Never, would have imagined that I would be smoking marijuana on national TV.
>> Not your dad's pot.
>> The stuff that we are using today, which is readily available and used by many people is — >> Much stronger.
>> What's in today's super weed? >> After smoking that kind of marijuana, the psychosis would come on immediately.
>> Plus, the first ever national ticket trap takedown.
>> They're just getting a cash grab.
And it's happening day and day.
>> How far will they go? >> The way they conduct their business, we're going to give you to a collections agency and then toll your car? >> And hightech ways to make you pay.
>> Possibly a city where you can't get away without paying for parking.
>> You can still do it but I would tell you that is a hard game to play.
[ ♪♪ ].