Vanity Metrics #21
Broken Records/Broken Promises
#StopHateForProfit is the runaway news item we need to talk about this week. It’s a quickly evolving situation so the goal here is to give you a quick primer and some links to people doing a great job keeping on top of unfolding events. And if there’s enough content, I’ll do my best to get out a second round-up of other social media industry news you can use tomorrow. Let’s get to it.
The Big Stuff
Just a few of the current brands boycotting Facebook ads. Courtesy: Luma Partners
#StopHateForProfit
Over 22 issues of Vanity, there’s been a reoccurring theme. In fact, it’s a reoccurring theme for just about anyone who works in social media: Facebook has a big problem with moderating content. Since 2016, this scenario has played out in public again and again: Facebook is accused of a track record that ignores hurtful/hateful content, fosters the growth of online hate and conspiracy groups, does little to prevent troll and fake accounts from manipulating conversations and experiences, and prioritizes ad sales over ethics (even after being caught over-inflating metrics to encourage spends). Mark Zuckerberg then issues a “we’re sorry, we’re listening, we’ll do better” video statement from the smallest room in his mansion, and the company promptly resumes business as usual. Lather, rinse, repeat.
Facebook’s business model is driven by an insatiable need to grow. And growth takes money. 95+% of Facebook’s revenue is derived directly from ad sales. If you want them to listen, you have to threaten their cash flow. It’s not a new suggestion, but it’s one that finally seems to have grown some momentum.
Enter #StopHateForProfit, the current movement among brands to temporarily divest from Facebook’s ad network. But this time, it’s not just small businesses and not-for-profits pulling up stakes. Some of the world’s largest companies (and Facebook’s biggest spenders) are pumping the brakes on ad spend in the hopes that it will get Facebook to take the issues seriously.
Is it working?
There’s a good chance that if you’re reading this newsletter, you’re aware of this already. So rather than waste your time retelling the story, here are a few links to key events so far, and a few places you can keep up in real-time because there’s also a good chance that your brand may be moved to react to the campaign sooner than you think:
As of July 1st, 430* brands across the globe have committed to pausing all ad spends on Facebook and it’s network for at least 30 days. Here’s the up to date list. Sleeping Giants is also keeping a running list on Twitter. *210 more brands have announced their participation in two days since I began writing this.
Of note: Verizon, Unilever, Coca-Cola, Ford, VW, Honda, Hershey’s, Puma, Adidas, SAP, Microsoft, Starbucks, Clorox, The North Face, MEC, Levi’s and Lululemon. Current estimates are that up to 1/3 of its ad revenue is under threat of drying up.
Media agencies are also stepping up: Omnicom’s Goodby Silverstein is pausing ad spend as well. Goodby represents, among others, Adobe, Pepsi, Cisco, Paypal, and BMW.
Insiders suggest that the company was already in crisis prior to the start of this campaign. Account executives are now manning the phones to try and stem the exodus.
It’s been reported that at an employee meeting late last week, it was clear Zuckerberg didn’t care about the “PR issue”: no substantive policy changes were being considered, and “all these advertisers will be back on the platform soon enough”.
“We’re not gonna change our policies or approach on anything because of a threat to a small percent of our revenue, or to any percent of our revenue,” - Mark Zuckerberg, June 26th, 2020
Facebook’s initial reaction was to issue a statement that it will adopt “some” twitter-like labels on “some” content, but leave it up. The general response from brands? “Weaksauce”.
All indications now point to a global expansion of the #StopHateForProfit campaign, with brands in Canada, France, UK, and Brazil coming on board. Canada’s 5 major banks have all announced their participation.
It’s been estimated that Facbeook’s stock has dropped in excess of $60B in the last week, with Zuckerberg’s personal stake declining some $7B. That will get the C-Suite’s attention!
Update to above: it did… sort of. Maybe? Zuckerberg’s team announced last night he’s agreed to meet with the campaign organizers (ADL, Sleeping Giants, Color of Change, NAACP, Mozilla, and more).
There’s a lot of growing disapproval with the way Facebook does business. But so far, only 3 of Facebook’s 25 largest advertisers have signed on, lending credence to Zuck’s position that this isn’t really any kind of an existential threat to Facebook, who routinely pays out millions in fines for violations as just the cost of doing business.
This is by no means over. For the next few issues at least, we’ll add a section to include any substantive updates to the campaign. If you want to learn more or see how you or the brands you represent can participate, please visit stophateforprofit.org.
Ryan LaFlamme has worked in social media marketing and advertising for longer than the job had a title. He formed the independent social consultancy Hub and Spoke in 2016, and can be found hanging out on Twitter @ryanlaf Now accepting new clients and speaking engagements.