Facebook’s Ad Problem Just Turned Into a Full-Blown Crisis

Mark Zuckerberg is scrambling to appease Facebook's critics as big and small brands pull their ad money, but it doesn't seem to be working this time.
AP Photo/Mark Lennihan, File
AP Photo/Mark Lennihan, File

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It started as a murmur of dissent, but over the weekend the campaign to persuade brands to boycott Facebook ads for the month of July turned into a major crisis for the social media giant.

It began badly on Friday when Unilever, one of the world’s biggest advertisers, announced it was joining the Stop Hate for Profit campaign, which had already been backed by Verizon, Patagonia, and Ben and Jerry’s.


Facebook quickly tried to take action to stem the outward flow of ad dollars, announcing a new policy that would follow Twitter’s lead and begin labeling questionable content.

But it wasn’t enough.

Coca-Cola and Hershey’s joined the campaign soon after, and throughout Saturday and Sunday, dozens of other companies, large and small, added their names to the list.

Global drinks giant Diageo, which owns brands like Guinness, Smirnoff, and Johnnie Walker, said Saturday it would stop buying ads on all social media platforms from July 1, and “will continue to discuss with media partners how they deal with unacceptable content.”

Beam Suntory, which owns the Jim Beam and Maker’s Mark brands, said it would stop advertising on Facebook and Instagram until the company came back with a better answer.

Clothes brands like Levi Strauss, Jansport, and Lululemon added their names to the list, and the head of marketing at Levis criticized Facebook’s “failure to stop the spread of misinformation and hate speech on its platform.”

On Sunday, things got even worse for Facebook. Starbucks, which is the sixth-largest advertiser on the platform, announced it was pausing all social media advertising.

Major brand names like these help the campaign gain traction, but Facebook makes the vast majority of its advertising revenue from much smaller companies — and dozens of those have signed up for the boycott, too.

Even Prince Harry and Meghan Markle are advocating for the campaign, privately urging brands to join the effort, according to Axios.


By Monday morning, more than 160 companies had announced they are stopping or pausing advertising on Facebook or social media more broadly.

Facebook makes 98% of its annual $70 billion revenue from advertising, and the impact of the campaign has not gone unnoticed on Wall Street. Facebook’s stock price tumbled more than 8% on Friday after Unilever’s announcement, wiping $56 billion off Facebook’s market value.

In pre-market trading Monday, Facebook shares were down a further 2.5%.

The Stop Hate for Profit Campaign, which is being supported by a coalition of civil rights groups like the Anti-Defamation League (ADL), Color of Change, and the NAACP, was launched in the wake of the Black Lives Matter protests sparked by the police killing of George Floyd.

The campaigners want to hold Facebook CEO Mark Zuckerberg accountable for the spread of hate speech and misinformation on the platform.

As more and more advertisers have joined the campaign, Zuckerberg attempted to appease critics by announcing a number of minor policy changes.

On Friday, Facebook said it would now label posts that may violate its policies but are allowed to remain on the platform because they are deemed newsworthy — mirroring Twitter’s stance. Facebook will also include a link to its voting information center on any post with information about voting, including posts by politicians.

“This is not a judgment of whether the posts themselves are accurate,” Zuckerberg said.


His critics weren’t mollified.

“We have been down this road before with Facebook,” the Stop Hate for Profit campaign said in a statement. “They have made apologies in the past. They have taken meager steps after each catastrophe where their platform played a part. But this has to end now.”

The organizers have so far only focused on advertising in the U.S., but now they are ready to take the campaign global.

“The next frontier is global pressure,” Jim Steyer, chief executive of Common Sense Media, a nonprofit that is part of the coalition, told Reuters this weekend, adding that the campaign hopes to use its growing power to pressure EU regulators to take a harder line on Facebook’s policies.

Cover: In this Friday, Oct. 25, 2019, file photo, Facebook CEO Mark Zuckerberg speaks about "News Tab" at the Paley Center, in New York. (AP Photo/Mark Lennihan, File)