Principled stand against Facebook looks more like a handy excuse
As boycott snowballs, firms’ motives are coming under question, write Michael Cogley and Hannah Boland
As Facebook’s advertising boycott grows, so too has scepticism over the motives of some of the businesses involved. From Unilever to Patagonia, some of the world’s biggest companies have joined the campaign in protest over Facebook’s handling of hate speech and misinformation. They all claim to be withholding their ad dollars to achieve the lofty goal of holding social media companies to account. They say they want to drive change, and hitting Facebook’s bottom line is the best way to spur a change in the way networks are moderated.
They may indeed have the best of intentions, but perhaps shrinking the advertising budget ahead of a looming recession has a role to play too.
“Advertising budgets are being cut back fairly significantly,” says Tiernan Kenny, Access Partnership UK policy manager. “If you look at the types of companies that are involved in the boycott, they tend to be consumer or luxury consumer brands. I think all of those brands are going to be at least looking very carefully at where they spend their money and probably are looking to make significant cutbacks.”
Kenny is one of a number of doubters of the intentions of some of the companies that have signed up to the Stop Hate for Profit campaign.
Advertising has been hit heavily by the pandemic with figures from the Interactive Advertising Bureau pointing to a 16pc decline in “cost per thousand impressions”, a bellwether for the health of the ad industry.
The public policy manager says that in a way the boycott acts as a “handy excuse” for some companies planning to reduce advertising spend on what have arguably become toxic platforms.
“The very clear underlying motive is financial,” he says. “You have to go company by company. If you look at brands targeting certain demographics, like younger people for example, their customers would expect brands to stand for something beyond quality or value.”
Publicity around the advertising boycott has snowballed in recent days. A coalition including the National Association for the Advancement of Colored People has been urging companies to stop advertising on
Facebook for not doing enough to stop hate speech, using the #StopHateForProfit hashtag.
The boycott gained momentum amid the latest civil unrest after activists pressed Facebook to be more aggressive in curbing racism and inflammatory content, including from Donald Trump, the president.
This week, it started to spread to Europe. On Tuesday, Puma joined a long list of more than 200 companies that have pulled advertising. Honda said it would be stopping advertising through Facebook and Instagram in the bloc through July “in alignment with our company’s values, which are grounded in human respect”.
Already, the campaign is expected to cost the social media firm hundreds of millions of dollars.
Yet, among brands, there have been questions over what they’re truly supporting. “If I gave a survey to those people in my business, I’m not sure half of them would exactly know why they’d boycott advertising on the site,” says an executive at one business which uses Facebook to advertise.
“It feels muddled to me... I think it’s partly just an opportune moment for brands to get Facebook to sort its act out more broadly,” says the executive.
In the past, widespread boycotts to bring in protections for advertisers have paid off. In 2017, major brands pulled spend from YouTube after their ads appeared next to terrorist, hate speech and misinformation videos. Ultimately, this resulted in YouTube cutting advertising from thousands of channels to “prevent potentially inappropriate videos from monetising”.
This time, though, it’s a little different. “It’s bigger because of what’s happened with the Black Lives Matter movement and the swing in public opinion,” says Sir Martin Sorrell, the S4 Capital boss. “Advertisers are reflecting this genuine shift.”
Still, how long this will continue remains to be seen. S4 Capital expects the digital advertising market will remain worth around $250bn (£200bn) worldwide, out of the total ad market of $500bn this year. This total market will be down on last year, but “digital will stay the same so its market share will go up,” Sir Martin says.
The pledges by some brands are, notably, limited. Ford and Honda, for instance, are only pausing advertising for a month. Others, such as Unilever, have committed to only pulling US ads.
Larry Chiagouris, a Pace University marketing professor, claims Facebook is likely to remain attractive for advertisers. The boycott “may lead to a softening of Facebook revenues a bit, but it will bounce back,” he says. “Rightly or wrongly, people are still in love with their Facebook accounts.”
Facebook‘s Mark Zuckerberg faces significant losses in advertising revenue