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Brands Don’t Like Facebook’s Fiasco, But They’re Still Buying Ads

Most advertisers are taking a wait-and-see approach to the Cambridge Analytica fallout, but they’re also reflecting on their use of Facebook and the mistakes it’s made.

Brands Don’t Like Facebook’s Fiasco, But They’re Still Buying Ads
[Photo: LPS.1/Flickr; Illustration: OpenClipart-Vectors/Pixabay]

The Cambridge Analytica fiasco at Facebook is obviously a dumpster fire of data privacy issues, corporate responsibility issues, and, y’know, the future of democracy in the digital age. And considering the other group we associate with user data and Facebook are brand marketers and advertisers, they’ve been getting painted by many with the ol’ guilty by association brush.

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So far, auto parts retailer Pep Boys, web company Mozilla, and Germany’s second largest bank Commerzbank have all pulled their ads from Facebook. Sonos turned it into a branding opportunity, announcing on March 23 it would pull its ads from the platform, as well as Instagram, Google, and Twitter for a week and donate an undisclosed amount of money to the RightsCon digital rights conference instead. But as the dust continues to settle, most brands and their ad agency partners are taking a measured, wait-and-see approach before making any rash decision about their ad strategy on the platform.

Still, the scandal–and Facebook’s recent revamping of its news feed to prioritize friends and family over other pages, and the anticipated ad rate price hike that will follow–has also prompted agency and brand executives to seriously reflect on how they use the platform, and its role in their overall marketing strategies.

“We’re still early days in this, but something that clients have to think about is, regardless of what we’re doing on Facebook, how do we make sure we’re being transparent?” says R/GA’s managing director of social Kyle Bunch. “Everybody going forward will have to be more transparent about this sort of thing. It’s hard to determine the exact approach today, so there’s a bit of caution on the part of brands because they don’t want to add to any consumer confusion. You’ve got to find a measured approach.”

Aki Spicer, chief strategic innovations officer at TBWA/Chiat/Day New York says they aren’t actively changing plans but are certainly watching developments over the coming weeks.

“Frankly, we just haven’t noticed users change behaviors,” says Spicer. “The irony is this ‘scandal’ seems to have gotten Facebookers to post to Facebook about their outrage and intent to quit Facebook. But, is anyone really quitting? And if they aren’t quitting, well, advertisers must go where the audiences truly are.”

“We Want To Be Ethically And Morally On Point”

Still, the key for brands and advertisers is to make sure their presence on Facebook–and the entire internet for that matter–isn’t creepy, and that any consumer data is used to create an honest value exchange. Bunch cites both Netflix and Nike as brands who provide a transparent value exchange to people. We happily share every location, distance, and time of our runs on Nike Plus because Nike gives us back data on our progress, and more personalized coaching tips. As a result, Nike can target messages that aren’t creepy because we know we gave them data with that understanding. We also happily let Netflix mine all our watching habits because we know it will help improve their personal recommendations for us. That’s the value.

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“That’s what more brands need to build toward, yes, because we want to be ethically and morally on point and creating good experiences, but also from a business standpoint, a lot of what we’re talking about here is being too reliant on Facebook to be the interface of communication between you and your customers,” says Bunch. “If you’re totally dependent on Facebook’s data to know who your customer is, you’re in trouble.”

Now, there are any number of ways your favorite brand can learn more about you, whether that’s through your e-commerce habits, customer surveys, Google, apps, the myriad of consumer data brokers like Acxiom or Experian, and other web tracking firms. (On Wednesday, after it announced new privacy settings for users, Facebook said it was also ending Partner Categories, which lets third-party data brokers offer their own ad targeting directly through the social network.) But even when brands possess mountains of their own data, Facebook remains a significant part of the way many advertisers use the data to communicate with their customers, learn more about them, and automatically find others like them. That’s not ending anytime soon. Last year, the company’s ad revenue grew by 49% in 2017 to $40 billion, reaffirming its place, alongside Google, as the world’s digital ad behemoth. As TBWA’s Spicer says, advertisers go where the people are, and most people are still on Facebook.

Facebook Forgot It Was An Ad Company

Fintech startup Wealthsimple has used Facebook as a part of its marketing strategy to give millennials a new kind of financial advice. Its videos of everyday people alongside celebrities like Aubrey Plaza, Mark Duplass, Bryan Tyree Henry, spilling real talk about money, have racked up plenty of views on the social network. The brand’s director of marketing Nick White says this Cambridge Analytica situation isn’t good at all, especially for brands like his that use Facebook to build consumer trust.

“It’s a huge moment of crisis for Facebook because they’ve lost a measure of trust with their users, and that makes us nervous,” says White. “I’d hope people don’t suddenly not trust us because we’re on Facebook, but what I’m more concerned about is that people stop thinking of Facebook as a place they can go to for information. Both this and fake news are a big component of that. People need to be able to trust what’s in their news feed, whether it’s from friends or brands.”


Related: Facebook leadership sinks 20 points in new corporate reputation poll


But White also says it’s all just part of a larger overriding issue facing the social network: Facebook doesn’t know what kind of company it is, and its relentless pursuit of developers, and the data it gave away as a result, caused its latest crisis, he says.

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“They’re one of the most valuable companies in the world, but they don’t know who they are. That’s what I find most problematic,” says White, adding that Facebook forgot it was an advertising company. “If you’re an ad company, the last thing you do is give away data because it’s a unique advantage, and when you give it away, you empower your competitors. If they knew that they were in the business of providing products people really like for free in exchange for advertising, they’d be okay and this wouldn’t be an issue.”

Ultimately, if this whole disaster for Facebook has told advertisers and brands anything, it’s simply reinforced what they should (and should not) have been doing already: acting transparently and responsibly with anything even remotely related to consumer data.

“We need more transparency on the brand side, and we need to empower and educate consumers to be more mindful of this stuff,” says R/GA’s Bunch. “We’re all clicking and agreeing to a lot of terms of service out there.”


Related: Facebook Has Serious Transparency Issues, But Advertisers Aren’t Going Anywhere

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About the author

Jeff Beer is a staff editor at Fast Company, covering advertising, marketing, and brand creativity. He lives in Toronto.

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