View all newsletters
Sign up for our free email newsletters

Fighting for quality news media in the digital age.

  1. News
June 25, 2020updated 30 Sep 2022 9:25am

Facebook advertising boycott: Campaign harming brand but not bottom line of media giant

By William Turvill

Advertisers are coming under increased pressure to join the growing Facebook advertising boycott that is being orchestrated by the ‘Stop Hate For Profit’ group.

The campaign – described as a “response to Facebook’s long history of allowing racist, violent and verifiably false content to run rampant on its platform” – has drawn support from brands including Ben & Jerry’s, The North Face, Patagonia, Upwork and Mozilla. The Guardian has described it as Facebook’s “largest ever advertiser boycott”.

But is the movement a serious financial issue for Facebook – which last year made advertising revenues of $70bn – and therefore an opportunity for publishers to regain some market share from the social media giant? Or is it simply PR posturing from brands that will have little impact on Facebook?

Analysis by Press Gazette – based on expert opinions, share prices and examination of statements from the brands – suggests that, although Facebook’s reputation is being damaged, the boycott is currently a financial insignificance to Mark Zuckerberg’s company.

Why are advertisers boycotting Facebook?

On Wednesday last week, a group of campaign groups led by Color Of Change launched ‘Stop Hate For Profit’, which calls on companies to suspend advertising on Facebook through July and demand that it addresses “racism across their platforms”.

Color Of Change has been pressuring the platform to “do the right thing and make their platform safer for the millions of black people that use it” for five years.

Launching ‘Stop Hate For Profit’, it said: “From the monetisation of hate speech to discrimination in their algorithms to the proliferation of voter suppression to the silencing of Black voices, Facebook has refused to take responsibility for hate, bias, and discrimination growing on their platforms.”

Content from our partners
Why Germany's most profitable news publisher is staying free online
To protect future newsrooms from AI fakery we must first protect the past
Livingdocs: 'Future-proof and agile' content publishing system

Facebook came under fire from its own staff earlier this month when the company chose not to remove or flag a controversial post from President Donald Trump in reaction to protests that were prompted by the death of George Floyd. In the post, Trump indicated he was prepared to “send in the National Guard” and warned that “when the looting starts, the shooting starts”.

On Sunday, Facebook confronted the issue in a lengthy blog post, saying it is “taking steps to review our policies, ensure diversity and transparency when making decisions on how we apply our policies, and advance racial justice and voter engagement on our platform”.

Which brands are boycotting Facebook and what have they said?

Last Friday, The North Face became the biggest brand to join the campaign.

Outdoor equipment retailer REI soon followed suit.

Clothing brand Patagonia joined them on Sunday.

And ice cream maker Ben & Jerry’s and Eddie Bauer backed the cause on Tuesday.

Jason Kint, the chief executive of Digital Content Next, a trade body that represents digital publishers, said the movement is a “very clear demonstration to advertisers and consumers of the harms brought to our society by Facebook’s platforms”.

“It’s been well-documented over the years that their business model of collecting data to microtarget advertising is toxic without proper responsibility for the content and engagement that they promote through it,” he said.

“The ‘Stop Hate for Profit’ campaign is bringing to light the apparent hypocrisy of advertisers who, on the one hand, continue to spend on the platform – to the tune of more than $70 billion this year – while at the same time promoting their Black Lives Matter initiatives to their customers and employees. As New York Times’ The Daily covered Monday, Facebook is undermining their message and it’s reassuring to see more and more advertisers willing to back up their concerns with action.”

Facebook advertising boycott: How bad is this for the giant?

Reputationally, as Kint’s comments make clear, Facebook is suffering.

But is the tech giant about to lose a large chunk of its advertising revenues –which were this week forecast to be up 5% in the US through 2020 – because of this campaign?

Not according to Facebook’s share price, which closed the trading day on Tuesday at an all-time high. It fell on Wednesday, but this appears to have been part of a wider tech stock sell-off.

One senior media analyst, who asked not to be named, told Press Gazette: “Overall, I don’t think it will make that much impact really.”

He pointed out that many of the boycotting companies appear to be doing so over a time-limited period – in most cases, for the month of July. “It’s a bit ‘have your cake and eat it’,” he said. “‘Yeah, we will put principles before profits but only for a selected time period.’”

The analyst also said that many companies and advertising agencies are “wedded to spending” on social media, and that this is unlikely to change.

Finally, he estimated that most of Facebook’s ad revenues from small businesses, many of whom are unlikely to join the boycott. He added: “The only way I could see it having a meaningful impact is if they took advertising off Facebook, then realised it had little impact on the numbers, and so decided to switch their ad budgets on to other platforms.

“But I suspect given the confusion around measuring impact, that’s unlikely.”

‘Facebook is very experienced at being the bad guy in the room’

Social media consultant Matt Navarra told Press Gazette: “Brands boycotting Facebook’s ad platform is more symbolic and a PR problem than any real immediate threat to its business or revenue.

“Whilst the brands that have joined the boycott movement are noteworthy, they represent only a tiny fraction of the millions of other companies using Facebook advertising every day.

“Facebook’s most likely course of action will be to address the concerns brands are raising through cautiously worded PR activity, and to play a waiting game to see how it plays out over the coming weeks. Whilst they won’t like the negative press coverage, Facebook is very experienced at being the bad guy in the room when it comes to social networks. It has other more pressing concerns to handle at this time.

Dylan McLemore, an assistant professor of public relations at the University of Central Arkansas, said: “The boycotts have already proven to be excellent PR for the early-adopting brands, which may be the biggest encouragement for others to join the cause.

“We’ve seen study after study the past few years indicating that American consumers, especially the sought after 18-34 demo, want brands to engage in corporate advocacy.

“It’s low-stakes advocacy with high goodwill upside. These companies aren’t big Facebook spenders, and are only committing to suspend advertising through July. For wanderlust brands, pulling adverts when much of the world isn’t traveling makes sense apart from a boycott.”

He added that Facebook has “weathered far worse storms”, but suggested the current momentum of the campaign could lead to serious issues for the firm.

“Advertising is over 90% of Facebook’s revenue,” McLemore said. “If recent protests have proven anything, this cause can catch fire quickly and scorch Facebook’s core business model.”

Paul Briggs, an analyst at Emarketer, said: “If a broader coalition of advertisers joins the movement to boycott ads on Facebook in July, it’s possible it will affect the company’s ad revenues for the year.

“However, larger forces, namely Covid-19, stand to harm revenue trending in the short and medium term. What’s also interesting is the term of the boycott – one month – which suggests many of these advertisers plan to return their ad dollars to Facebook, presumably because of its efficacy as an ad platform.”

Asked whether the Facebook boycott could represent an opportunity for publishers, he said: “Covid-19 has hit traditional media particularly hard. Its 2020 ad revenues will be significantly down, while digital publisher revenue will be roughly flat.

“How people consume news has shifted to favor social and search media. If these sources fail to keep trust, it’s possible more traditional news purveyors can claw back some of what’s been lost over the last several years – but delivery has to be reimagined for immediacy-minded consumers.”

Picture: Reuters/Dado Ruvic/Illustration/File Photo

Topics in this article :

Email to point out mistakes, provide story tips or send in a letter for publication on our "Letters Page" blog

Select and enter your email address Weekly insight into the big strategic issues affecting the future of the news industry. Essential reading for media leaders every Thursday. Your morning brew of news about the world of news from Press Gazette and elsewhere in the media. Sent at around 10am UK time. Our weekly does of strategic insight about the future of news media aimed at US readers. A fortnightly update from the front-line of news and advertising. Aimed at marketers and those involved in the advertising industry.
  • Business owner/co-owner
  • CEO
  • COO
  • CFO
  • CTO
  • Chairperson
  • Non-Exec Director
  • Other C-Suite
  • Managing Director
  • President/Partner
  • Senior Executive/SVP or Corporate VP or equivalent
  • Director or equivalent
  • Group or Senior Manager
  • Head of Department/Function
  • Manager
  • Non-manager
  • Retired
  • Other
Visit our privacy Policy for more information about our services, how New Statesman Media Group may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications.
Thank you

Thanks for subscribing.

Websites in our network