Facebook and social media platforms make their money predominantly through selling paid advertising and in the first quarter of 2020, Facebook reported revenue of $17.44 billion. Over the past two months, more than 1000 advertisers have pulled their spend from Facebook, and other social media platforms, as part of a mass boycott over content policies.
Big names such as Coca Cola, Starbucks, Adidas and more recently Unilever join the growing number of well-known brands who are joining the movement in order push forward policy changes on platforms such as Facebook, Instagram and Twitter on the spread of disinformation and hate speech. Facebook, which makes more around 98% of its 70 billion annual revenue from advertising, is said to have 90 major advertisers planning to or already have pulled their paid advertising – although much of Facebook revenue does still come from small businesses, rather than solely large multinationals.
Nevertheless, the boycott is a PR risk, and so recently Facebook, which also owns Instagram, has said they have changed their position on content control and will now label potentially harmful posts on its platform, as well as ban ads that describe different groups ie. based on race or immigration status. This move alone though has not been enough to deter the swath of growing numbers of brands stopping ad spend, at least for July, with recently the major UK drinks brand Diageo announcing they will pause paid advertising worldwide on all social media channels.
Helping to broaden the scope of this movement was when Unilever, now the largest advertiser to pullback will stop paid advertising on all social media until at least 2021, not just for the month of July. The ‘at least’ portion of their statement stresses how they are settling in to take a much larger stance beyond the one-month hiatus many other brands initially pledged. As Unilever is one of the worlds top advertisers by media spend and have now significantly realigned their budget priorities, as it is said they intend to retain planned investment for 2020 but will reallocate spend into other channels.
The combination of a pandemic and new civil rights movement has seemed to genuinely push forward important issues regarding the spread of disinformation and hate on social media more so than it possibly could have ever done previously – with many brands reassessing their values and priorities. It is also not lost that this pause is also coming at a time when Q2 marketing budgets are also being set – not being a cynical strategy, but perhaps with the momentum for real change whilst reassessing budgetary and broader media content requirements could make it a win/win for marketers.
In reality, however, Facebook will not be going anywhere, even if its advertisers are – for a while. Rather than permanent pivots, brands are likely to simply turn to alternative channels in the meantime before returning to Facebook in due course, hopefully after Facebook and other platforms commit to making a positive difference.