Facebook has seen a slew of new retailers including Adidas, Puma, HP, Ford and Best Buy pull their advertising as pressure mounts on the social media company to take action.
The #StopHateForProfit campaign is continuing to gather pace as more major companies announce plans to stop buying advertising across Facebook and Instagram, which it purchased in 2012, throughout July.
Despite the boycott already wiping $56 million off Facebooks market share value, seeing stocks drop around eight per cent, none of these brands represent Facebooks biggest advertising spenders.
These are the companies that spend the most $ on Facebook ads.
— Sacha Baron Cohen (@SachaBaronCohen) June 26, 2020
In fact, according to Pathmatics, none of the brands currently boycotting Facebook were even in the top 100 US spenders for advertising revenue, which hit $17.7 billion in the first quarter.
However, its reputational damage could be far more destructive than its potential financial losses.
Speaking to the BBC’s today programme, Aviva Investors David Cumming said that the loss of trust and perceived lack of moral code could “destroy the business”.
Levi’s, Unilever, The North Face, Patagonia, Starbucks and REI are also among the retailers who are targeting Facebook over its failure to tackle the spread of racist, hateful and misleading information on its platform.
— Sleeping Giants (@slpng_giants) June 27, 2020
Yesterday, following the news that Unilever has pulled its advertising, Byfield Consultancy’s Asad Moghal said that the real danger for Facebook was a potential domino effect.
“By taking financial action, a company the size of Unilever can effect change and force the hand of Twitter and Facebook; the business has decided it needs to protect its brand reputation and can longer be associated with platforms that deliver hate speech and divisive content,” he told The Guardian.
“But what will really effect change is if this move creates a domino effect and other big-name corporations remove investment from the platforms.”