FMCG giants the latest to drop ad spend from Mark Zuckerberg’s platform; but how far will the exodus continue?
A coalition of civil rights groups have called on advertisers to pause advertising money to Facebook until at least the end of July in a #stophateforprofit campaign to encourage the company to amp up its effort against hate speech and disinformation. Unilever is the latest major advertiser to pull its spend from Facebook as a result of its perceived inaction over hate speech in light of recent events, announcing on Friday (27th) what it calls a ‘pause’ in advertising across the platform (plus Instagram and Twitter) until at least the end of 2020, with the budget being diverted to other media. The news unsurprisingly hit the social giant hard, with shares reported to have dropped by more than 8% as a result. Unilever is only the latest in a long and diverse line of over 100 advertisers to boycott the channel, ranging from Starbucks, to Honda, to Ben & Jerry’s. What does it mean for Zuckerberg’s business, though?
One school of thought runs that actually, Facebook’s behaviour (or lack of) has been something of a gift to those advertisers who’ve been seeking to cut marketing spend as a result of Covid-19 – allowing them to do so at the same time as gaining PR point. And with the platform offering second only to Google in the percentage share of global digital ad spend – its reach, scale and affordability make it hard to turn away from in the long term. Despite the initial reaction of investors, Facebook’s underlying business revenues primarily come from small to medium enterprises, which as yet don’t seem to be turning their back on the platform, either.
But it does seem that we’re in the middle of a moment in which brands are thinking hard about whether the cultural damage inflicted on them by aligning with the platform outweighs straightforward ad spend economics. We are continuing to monitor this evolving story and are working with our clients to navigate spends within Facebook across this period.