The Facebook ad boycott is a tactical retreat

July 15th, 2020 | Jeannette Ornelas

Setting the tone 

What do I need to know about the Facebook ad boycott?

On June 17, civil rights groups called for a “pause” on Facebook ads during the month of July. The goal is to apply public pressure on Facebook to stop generating ad revenue from content that amplifies hate speech, allows posts that incite violence, and is complicit in the spread of misinformation. Civil rights leaders have outlined 10 demands that address accountability, decency, and support.

A timeline of notable events that unfolded since the Facebook ad boycott was announced on June 17:

  • June 19-21: Big brands were quick to join the boycott. The North Face, Patagonia and REI were among the first to commit to pausing ads on Facebook and Facebook-owned Instagram.
  • July 1: Facebook published a blog post laying out the work it is doing to address the “recommended next steps” the Stop Hate For Profit campaign laid out.
  • July 7: Facebook’s CEO Mark Zuckerberg, COO Sheryl Sandberg and other Facebook leaders met with civil rights leaders. Those leaders were disappointed with the outcome of the meeting.

In the first week of the boycott, the CPG category saw its Facebook ad spend reduced by nearly half week over week.

…for SMBs and DTCs, Facebook advertising is a primary acquisition source.

The Advertiser open letter to Mark Zuckerberg provides a concise explanation of why SMB and DTC brands can’t easily pull Facebook ads. The letter notes that advertising comprises 98% of Facebook’s revenue and as a network of advertisers with high spend purchasing power, they are in a unique position to leverage their estimated future annual budget to demand change. The goal is $100M in purchase power (currently at 97% to goal). To take action, advertisers can sign and share with their networks. This letter was shared with Facebook on July 1 and is continuing to collect co-signers. Signers also receive an invite to a Slack channel for progress updates and to discuss any further actions to take.

Does the ROI of advertising on Facebook offset the risk of my ads appearing beside harmful content? 

Brand safety isn’t Facebook’s only problem. It’s also fighting an aging user base. Over the last 4 years, Facebook has seen a sharp decline among Gen Z/Millennial users, while its child company Instagram has picked up the Gen X crowd.

What we think

Facebook has a reputation problem, not a long-term revenue problem.

The companies boycotting don’t rely on Facebook and Instagram as primary sources of acquisition but they also can’t afford to leave the platforms for good, which is why they didn’t leave altogether, just paused ad spend. The reality is, there is not a credible alternative at the scale of Facebook.

For the ad boycott to really hurt Facebook’s bottom line, SMBs and DTCs would have to get on board. During a downturn, small advertisers stick with what they know – and what they know is Facebook. That’s not to say advertisers can’t continue to put pressure on Facebook, but it will take more than a one month ad boycott from a few hundred advertisers.

As the boycott continues through July, there is one big question advertisers should have in mind: what is the future of brand safety?

Jeannette Ornelas

Jeannette Ornelas

Jeannette Ornelas is a Senior Digital Marketing Analyst for Comperemedia. Jeannette is responsible for producing syndicated and custom reports and providing marketing insights across a range of industry sectors and channels.