A flood of high-profile advertisers announced this week that they would boycott advertising on Facebook through July, responding to criticism of Facebook’s inaction on hate speech. Facebook’s stock fell 8% on Friday, wiping $7 billion off of CEO Mark Zuckerberg’s net worth.
The boycott has sent Facebook execs scrambling, with the social media giant’s top ad exec on Friday sending a memo to advertisers promising an external audit of its safety tools and practices. Facebook also said Friday that it is going to start labeling posts from politicians that break its rules but are “newsworthy” enough to remain on the platform.
The boycott is another example of the increased willingness of big brands to take a stand, as they respond to pressure from their own employees and customers. But as Tanya Dua, Lauren Johnson, and Lucia Moses report, many of these advertisers didn’t spend much with Facebook, and the boycott statements are temporary and vaguely written, which could make it easier to resume spending after July while winning goodwill in the meantime. From their story:
Most of Facebook’s advertising comes from small companies that can’t afford to turn off the channel. Smaller brands that join the boycott could risk losing up to 80% of their monthly revenue, said Devin Whitaker, director of performance marketing at ad agency Good Moose.
Meanwhile, advertisers like Coke can come off looking virtuous by pulling their ads with statements that increasingly upped the ante.
In addition, as Tanya, Lauren, and Lucia report, a lot of advertisers spend less in the summer and in an election year anyway because sales are slow and there’s so much noise to break through.