Over the past few weeks, brands such as Microsoft, Lego, Danone, Mars, Volkswagen Group, Diageo, and Coca-Cola have joined in on the Facebook ad boycott. This comes as the “Stop Hate for Profit” campaign has been gaining traction online, calling for businesses to temporarily pause advertising on Facebook and Instagram. The campaign alleged that Facebook “allowed incitement to violence against protesters” fighting for racial justice in America and that it had “turned a blind eye to blatant voter suppression” on its platform. This led to the company losing approximately US$7 billion as a result of the boycott, after its shares dropped 8.3% recently, Bloomberg reported.
Facebook is without a doubt one of the popular ad platforms for companies in Asia. According to its Q1 2020 financial results, Asia Pacific accounted for US$3.2 billion of Facebook’s US$17.4 billion digital advertising revenue, after North America and Europe. Facebook also reported 678 million daily active users and about 1.1 billion monthly active users in Asia Pacific, way ahead of consumers in other regions. Recently, market research company eMarketer predicted that Facebook’s ad revenue will increase by 4.9% this year, even though the company reported a “significant reduction” in demand for advertising, as well as a related decline in the pricing of its ads, over the last three weeks of the first quarter of 2020.
As the ad boycott continues to grow, brands and agencies in Asia, especially with global counterparts might be left wondering how the ban might impact their marketing strategies, should the global mandate to stop spend expands to Asia. While Diageo, a brand which stopped all global ad spend, declined to comment further on its strategy, Coca-Cola’s spokesperson reiterated an earlier statement by chairman and CEO, James Quincey, that it has paused paid advertising on all social media platforms worldwide for at least 30 days, adding that there is no place for racism in the world and there is no place for racism on social media.
Similarly, Volkswagen Group’s spokesperson said it is suspending central advertisements on Facebook as it stands for open interaction with each other based on equality. An environment of fake news or hate speech is therefore unacceptable to them. “We just started with our initiative and will further monitor closely,” the spokesperson said, declining to reveal specifics of its marketing spend. However, the spokesperson said that suspending its Facebook ads does not necessarily mean that it will shift budget to other channels. Separately, Lego’s spokesperson said it will not change its media investment during this period and instead, invest in other channels, declining to comment further. Marketing has reached out to Microsoft, Danone and Mars for comment.
In the meantime, Facebook has also been actively discussing with agency leaders to best manage this situation. Carolyn Everson, Facebook’s VP of global business group at Facebook, together with Neil Potts and Guy Rosen from Facebook’s policy team held a virtual roundtable discussion at the end of June for media agency leaders to address questions about the work Facebook is doing to prevent harmful content on its platform, engage with civil rights organisations, and advance racial justice and voter engagement. Facebook’s spokesperson also told Marketing in a statement that it is “routine” for the company to have conversations with advertisers and discuss issues, including policy matters. Separately, Nick Clegg, Facebook’s VP of global affairs and communications, recently wrote an open letter which stated that it takes a zero tolerance approach to hateful posts on Facebook and Instagram and removes them. “When content falls short of being classified as hate speech – or of our other policies aimed at preventing harm or voter suppression – we err on the side of free expression because, ultimately, the best way to counter hurtful, divisive, offensive speech, is more speech. Exposing it to sunlight is better than hiding it in the shadows,” Clegg added.
A senior executive in a media agency who spoke to Marketing on the condition of anonymity said that with the Facebook boycott, search, YouTube, TikTok and LINE will all see positive uptick and incremental growth. But the boycott is unlikely to keep Mark Zuckerberg up at night. “Out of a US$100, for example, major advertisers would probably comprise US$30 while US$70 are from SMEs and other small businesses. Yes, global network agencies might spend billions of dollars on Facebook, but when you aggregate the SMEs, plumbers, and hairdressers of the world, the impact is greater,” he explained.
He added that one development that resulted from the ad boycott is that the innovations that clients and agencies have been discussing are coming to fruition – such as eCommerce. Besides eCommerce, OTT is also another area that is among the list of considerations for brands to shift their originally-planned Facebook investments to. While brands start to rethink their media strategy without Facebook for now, the senior industry professional said he does not see ad spend going back to traditional media.
“It all comes down to the individual client, what they are trying to achieve, and mapping the next best capability. Not many clients are being very clear on what their next steps are,” he said. While some of his clients initially paused ad spend for about three to five months due to COVID-19, just as they were about to start spending once again, this issue with Facebook threw a wrench in the plans. As such, he has seen one to two clients deliberate on whether they should hold back their ad spend for another month.
Meanwhile, CEO of Publicis Media Singapore Ian Loon told Marketing that how and where originally-planned Facebook investments are re-directed to varies by client needs, and are largely driven by key outcomes which are platform agnostic. They include video videos and lead acquisitions. Other platforms and channels also offer various products that fuel towards clients’ goals differently. As such, it is important to review what needs to be tested, what has worked in recent times, and how much cost efficiency increased spending on other platforms would deliver. He added:
The latest issue could free up a fraction of planned budgets, but in a highly tensed environment, the majority of brands are looking to save or re-invest only if alternative options can provide efficient-drivers towards shorter-term goals.
Loon also said that all platforms, new and old, must present specific products and solutions to seize the diversity of circumstances and desired long or short-term outcomes. When asked if this would result in brands considering investing in emerging platforms such as TikTok and Snapchat, especially since the latter is starting up in Asia, Loon said investment towards emerging platforms has always been at the top of the team’s mind to assess for clients regardless.
Will brands in Asia join the month-long boycott?
Although the issue behind the month-long boycott of Facebook might be US-centric, Loon said everyone needs to be aware and mindful of the topic regardless of geography as consumers today are aware of different cultures, histories, values and systems, and as such address the issue of inequality differently. On whether Asian businesses and brands would take as strong a stand as American brands, Loon said it would take a lot more to consider and lift the trade-offs that have to come with such a decision.
Meanwhile, the senior industry player who commented on the condition of anonymity said it might be a mixed bag of brands boycotting in Asia. For example, a global luxury goods brand headquartered in America might choose to boycott in Asia, but they will have to decide if it is doing so only locally matters because the issue might not matter on a global scale.
“Brands are balancing this out. One one hand, they have the responsibility to shareholders to drive the outcome of their business. On the other, they feel strongly about the social cause and want to support it,” he added. He explained that the organisations calling for the Facebook ad boycott are US-based and the movement is very much calling on America and Facebook to change.
They are classifying the issue very much with an American lens. Brands have to take that into strong consideration.
According to the senior industry player, Australia is probably currently the only market, in this part of the world, that is getting involved in the Black Lives Matter protests. “CMOs from Australia learn from their counterparts in the US, so there is a natural link between those two markets. CMOs in Australia look to the US for inspiration,” he explained. Over the weekend, Reuters reported that numerous residents in Sydney and other Australian cities gathered in support of the movement and an increased focus has been placed on the mistreatment of indigenous people. According to Reuters, there is greater awareness worldwide regarding the ill-treatment of minorities due to the Black Lives Matter movement. This came after Australia holds an inquiry into mining giant Rio Tinto’s destruction of two ancient and sacred Aboriginal caves.
Balancing responsibility to shareholders and the need for social change
Whether or not brands will need to drastically rethink their media strategies as a result of the Facebook ad boycott boils down to understanding what outcome and success looks like for them. The senior industry player explained that clients pull off ads from platforms “all the time and while the current boycott might be on a slightly different scale, it certainly is not new”.
“We sit down with the brand to understand their business, and optimise what we believe is the next outcome. This is not the first or last time a client will be pulling its ads off a platform. This is something that we media agencies face often. Hence, it’s about engaging with the brand, understanding what their business objectives are and designing a plan,” he said. in 2018 XXXXXXXXgoogleXXXXXXXXX
While there is no blue print for managing such crisis’, some areas of consideration when rethinking a brand’s media plans could include where they are in their marketing cycle, do they have products on the shelves, and whether the brand has an impending event.
Likewise, Publicis Media’s Loon also said that the short term strategy for brands and agencies is to openly discuss the issue and how far the are willing to go to take a joint position or stand. The longer term answer is for both to deeply align on how their joint position impacts all related levels of multiple decision-making processes, from brand positioning and product naming, to prospect-customer definition, and profit optimisation, Loon explained.
“The issue is far bigger than media and marketing, and has to do with aligning broader social views and action. Organisations and their employees will tighten theirs, but there are much deeper intricacies that may not translate into cross-organisational implications as quickly, especially when the effects are closely intertwined with commercial outcomes,” he said.
As such, while many brands are clear about what position to take, reconciling subsequent consequences and implications require careful and responsible assessment. According to Loon, this is also the main reasons why organisations should not put all their eggs into one basket in general, and leverage options in case an important one needs review or refurbishment.
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