From yesterday 400 high profile brands including Coca-Cola and Starbucks pulled advertising from Facebook.
The month-long Stop hate for profit campaign wants Facebook to do a better job of dealing with hate speech, bigotry, racism, anti-semitism and calls for violence.
Some of the advertisers are also worried about Facebook’s promotion of wild conspiracy theories.
Other social media sites have faced similar advertiser pushback. But the focus a the moment is very much on Facebook which seems unwilling to tackle hate speech and far right extremism.
Stop hate for profit is a response to calls from civil right groups. Campaigners and members of the public have contacted brands when their advertising appears next to extremist material asking if they endorse the content.
Things moved up a gear following the George Floyd killing, the subsequent protests and the fast growth of the Black Lives Matter movement.
Among others things the advertisers want Facebook to give refunds to companies whose ads show up next to hate speech and other offensive comment.
They also want Facebook to take responsibility when people experience severe harassment online. This includes letting them speak to a Facebook employee. At the moment Facebook makes it hard for victims to contact the company.
According to media reports there were last minute talks between Facebook and large advertisers taking part in the campaign.
It turns our Facebook refused to budge, all the company would do was point at its recent press statements.
Now the boycott is underway there are calls for a new meeting. Apparently the advertisers have asked for Facebook CEO Mark Zuckerberg to face up to the meeting. It is clear that he calls the shots on these matters.
Facebook says Zuckerberg will attend a meeting next week.
It may not be conciliatory.
In a leaked address to Facebook staff Zuckerberg says: “We’re not going to 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.”
He went on to say: “…my guess is all of these advertisers will be back on the platform soon enough”.
Facebook has made some recent changes in policy. It says it plans to label content in the same way that Twitter has started doing. But it hasn’t said when it will do this.
It also says it uses artificial intelligence to remove hate speech. The implication in this language is that the AI is already working. Yet there seems little has changed in practice.
Zuckerberg’s confidence that Facebook can ride out the boycott isn’t just chest thumping. Social media sites like Facebook, YouTube and Twitter are now the preferred route for big advertisers to reach mass markets. It has replaced TV advertising.
Some of the biggest advertisers use Facebook to build their brand. Little long-term harm is done if branding stops for a month. Others sell direct. If they don’t advertise, their revenue dries up. A month of low revenue during a global pandemic that is already depressing sales would be hard to stomach.
What about Zuckerberg’s claim the boycott only affects a small percent of revenue?
Last year Facebook took $70 billion in advertising. About 20 percent of that comes from the top 100 advertisers. This group doesn’t necessarily align with the boycotters.
It turns out that only three of Facebooks biggest advertisers have joined the boycott. The company says if all the top 100 advertisers joined, revenue would only drop 6 percent. There are around 400 boycotters, so a ballpark estimate says revenue will be down around 10 percent for one month. That’s likely to be around one percent of annual revenue.
On that basis Zuckerberg’s claim is probably right.
And yet there’s more to this than a small one-off revenue drop.
Some in the advertising sector see the campaign as a turning point. It hits Facebook where it hurts most. There could be more to come.
In the past Facebook has dealt with criticism of its failure to deal with extreme content in two ways. First, it issues press releases outlining the action it is taking. As we can see, this approach no longer cuts it with many critics. There’s been a lot of talk but little evidence of real change.
The other tactic has been to zero in on the most visible and offensive recent outrage and mop it out. That gets headlines and creates the impression the company is doing something.
This week it banned 220 members of the Boogaloo movement who advocate violence. The group overlaps with neo-nazis and white supremacists, but some members are gun lobbyists.
With anything involving business, it helps to follow the money trail. It turns out Facebook’s investors are relaxed about the boycott. On Friday the company’s share price dropped eight percent when the news first broke.
Earlier today the price had recovered. It was down about one percent on Thursday. Given the price fluctuates anyway, that indicates no one at Facebook anticipates much change.