Sounds like Verizon's Facebook advertising spend is losing value because of COVID-19, so they're using this a way to redirect focus away from the negative impact on their business.
All of the companies doing this right now are 'pausing spend' rather than redirecting. They're reducing their marketing budgets and pointing the finger at Facebook so no one looks too closely at the implications of their reduced ad spend.
To be fair to Verizon, they have not laid off a single person since March. The retrained 95% of their retail workers to be at home support agents and the rest are still working in their stores for issues that have to be solved in person.
So it makes sense that they would need to cut budget somewhere, since employees is not one of them.
I don't fault Verizon for cutting budget. It's absolutely the right thing to do. But if we weren't in the situation we're in they probably wouldn't be doing this.
The nuance between "we're going to stop doing business with Facebook because Facebook is bad" and "we have to cut budget from advertising and we chose to cut it from Facebook because Facebook is bad" is important.
It's convenient to do this now, but hard to believe that any of these companies would have done this at this kind of scale if they weren't backed into making cuts.
Sometimes things or people change. Something or someone that would have taken advantage of you before, learns its lesson and becomes trustworthy.
When it comes to things that you are bigger than, things which you can stop if need be, giving second chances is noble. But when it comes to things that are bigger than you, things you can't change at all, one chance is all they should ever get.
Verizon does not "respond [...] to public pressure," they just have a PR team that is leveraging some current narrative for their own benefit. They aren't changing, and they will never love you back.
Regardless of motivation, Verizon has clearly made a visible public action, which is what I was talking about and what speaks to the efficacy of the activist campaign against Facebook.
Headline: "Verizon suspends advertising on Facebook, joins growing boycott"
Root Comment: "Sounds like Verizon's Facebook advertising spend is losing value because of COVID-19, so they're using this a way to redirect focus away from the negative impact on their business."
Parent Comment: "Why is it impossible that Verizon is responding, at least in part, to public pressure against Facebook?"
Your Comment: "I suspect you might not get an answer to this since it's not something anyone has actually said here."
I read this the way the parent commenter read it as well: everyone is explicitly avoiding the notion that Verizon may be doing this because they feel like that is best for their public image. What I can't tell is if you're asserting that no one will answer because everyone is coming up with other ideas that seem to avoid the obvious, or if you think the parent commenter is asking a baseless question.
Verizon's earnings are down something like 3% YTD from their guidance [0] and their stock price is down 10%. Fortune 500 companies do not prioritise doing social good over profits when their share price is down 10%. Too many people are losing too much money; these are numbers that are supposed to go up.
It is obvious Verizon is taking action in context of the Facebook boycott because they've told us that in a press release. But it is a very safe bet that the decision is made accompanied by data that says "Facebook ads have not been especially cost effective for us over the last 12-18 months" and was probably already a decision in the works prior to learning about the boycott.
There are ~8 billion people in the world. Corporate executives are the tiny fraction of that population who are both hyper-competent and hyper-motivated by money. They did not suddenly wake up this morning and decide to try and do more good in the world than they were yesterday, and the odds are bad that they made this call based on nebulous "oh there is a boycott this month we just realised Facebook is nasty" style considerations.
> I read this the way the parent commenter read it as well: everyone is explicitly avoiding the notion that Verizon may be doing this because they feel like that is best for their public image. What I can't tell is if you're asserting that no one will answer because everyone is coming up with other ideas that seem to avoid the obvious, or if you think the parent commenter is asking a baseless question.
I think at this point most (if not the vast majority) of people think it a baseless question. Not because they think that it's impossible that Verizon/Verizon employees/Verizon executives/etc care but because non-human legal entities have lost all benefit of the doubt and credibility over the last few decades. The dominance of shareholder primacy has all but guaranteed it.
Even if the decision makers or even the majority of Verizon cares about this issue now, natural executive/employee turn over guarantees that they will go back to spending money with Facebook as long as there is a financial incentive to do so - sooner rather than later.
I am as cynical about the behavior of large corporations as anyone. But you can never really know anybody's motivations, only guess them from their actions.
Verizon could be doing it because of ad budgeting reasons. Verizon could be doing it because of public pressure. Most likely, both benefits go into their cost-benefit analysis.
I just searched for Verizon on Google, and there was a Verizon ad, so they're still spending on digital marketing elsewhere. That Google ad is not even likely to be profitable considering Verizon owns all the organic links in the first page of results except for the Wikipedia result ranked fourth.
If they were cutting advertising spend due to the economy, it would be rational to cut unprofitable spend first. I'm inclined to take them at their word for why they cut Facebook spend.
The rate Google charges for ads is inversely proportional to click-through rate, so you pay less per click if your click-through rate is higher. In the case of a company bidding to advertise on searches for that company’s own name, it means that the company can win the bid with a lower offer than competitors trying to put ads there. You could say Google is extorting Verizon to pay up to prevent competitors from stealing customers. But regardless, it’s probably a good value proposition for Verizon to participate in the auction, because
competitors would have to overpay to beat them.
That they pay little doesn't matter. What matters is that it's above zero, which is what the clicks would cost without the ad, making them unprofitable.
The competitor argument for running the ad has two problems. The first is that no competitors are bidding for that keyword, and the second is that a competitor would already have to pay a lot to get top of page placement for a keyword they can't put in their ad copy.
Not sure why you think an ad wouldn’t work here. Sometimes customers are willing to switch to a competing product. If you can offer something better or cheaper they might want it. I’ve worked at a company where we at times bought Google ads for both our own product name and competitor’s names and made money.
> Not sure why you think an ad wouldn’t work here.
"no competitors are bidding for that keyword"
That itself is enough to make Verizon's ads unprofitable.
If you think that competitors would bid for the keyword without Verizon's presence, you'll have to explain why because with Verizon's presence, if nobody clicks on it, the cost is zero. There appears to be a gentleman's agreement between the consumer communication companies not to bid on each other's name, and if that's the case, bidding on your own name is flushing money down the toilet.
I've seen the food delivery case, where Blue Apron bids on "Hello Fresh" and offers a better coupon than for people searching for "Blue Apron." That isn't happening here.
Most companies don’t want their advertising associated with anything that will give them bad press. We saw the same thing with YouTube and “demonetization”.
It’s not they are ethical, it just doesn’t make sense from a business standpoint.
Their willingness to suspend advertising is also an indictment of the practically nonexistent competitive landscape in mobile providers in the US.
There just aren't good alternatives to Verizon for many people where T-Mobile/Sprint don't have good coverage. Switching between AT&T and Verizon is pointless for most plans.
As someone who helps fortune 100 companies with digital marketing, this is cynical view of Verizon and other companies. I am not sure why you are shifting the conversation from advertisers trying to reform FB to advertisers taking advantage of the media pause for positive PR. I don’t believe any of the companies with paused FB campaigns are paused elsewhere. That means Twitter, AdWords, Amazon, affiliate, and CTV spend is live. Digital marketing teams have to make hard decisions and decide how best to communicate with their customers or potential customers. Pausing FB is a step in the right direction. Other organizations have done the same on YouTube. I am as cynical as they come but I don’t see how reduced ad spend is something to hide and blame one single network.
> I don’t believe any of the companies with paused FB campaigns are paused elsewhere
> Other organizations have done the same on YouTube
Can you clarify these points because the way I read them they sound contradictory.
Also, where are you finding this info about companies' advertising spends?
Not trying to be provocative, there's just a lot of misinformation out there.
For YouTube – that happened last year. Major agencies and corporations paused their YT spend. I wasn’t clear as I’m on mobile. You can search “YouTube advertiser boycott.”
It was caused by insufficient brand safety levers for advertisers on YT. I was providing an example where advertisers paused spend to show the importance of their beliefs.
I think the difference of opinions is that it sounds like you think the boycotts are a moral stand while we think the boycotts are driven by more practical considerations (in that the ads have become less valuable, either due to reduced consumer spending or increased brand risk).
Why is it that advertisers did not care previously and for so long? The status quo for a decade was that all parties - consumers, YouTubers, advertisers, and YouTube itself did not care much about the minority of ad placements that happened to be next to niche political, mature, or sexual orientation subject matter.
Was it the uptick in activists such as Media Matters and Vox conducting name-and-shame campaigns, contacting brands with screenshots and threatening publication? Once a campaign like that picks up media cycles (like the FB one at the moment) it seems that brands follow en masse only then, and not a moment earlier.
I can't speak for each brand or agency, but the majority have been vocal with YouTube or FB or Twitter for years. Each of those ad platforms has a slew of teams that work directly with the enterprise buyers (top advertisers). I remember a major USA bank giving explicit feedback to the YouTube product team six years ago due to limited brand safe content control. I was in the room. There are still two accepted strategies for delivering ads on user generated content networks. One, that if user targeting is used and an ad is served against questionable content, then the content is less important. Why? You delivered an ad to your target market. Two, even with user targeting, the ad's context and content should align with the advertisers ad. I think we are seeing #2 uptick across the board.
For networks like YouTube and Facebook they are in control of the algorithm, feed, ad decisioning, user targeting, and cost. Why can't they afford transparency and more control for advertisers? I don't know to be honest. I assume those features would limit revenue.
To answer your last question, I also don't know what tipped it. It seems like society is shifting quickly right now and brands want to better align with those changes. Someone else asked if all of this was for the sake of practicality. That is a part of it. Users are influenced by advertising and while we can't decipher the exact mix of it that truly influences behavior, brands are trying to protect themselves from egregious content.
I try to create physical analogies for my clients. Let's pretend the path to our storefront (selling clothes) is in a manufacturing warehouse park. Who is going to be enticed to enter the path to the store, or be curious to learn about the store's wares? I predict few folks would enter. It is similar to ads across the web. Some are there to entice you to click (enter) their store and some are there to inform you. Either way, context likely has some influence. Brands acknowledge that. Not to mention, zero brands want someone to screenshot their video or display ad next to something deemed malicious.
Lastly, it is hard for advertisers to turn their backs on channels that generate high returns or are table stakes. What would you do if the billboard that drove the most customers to your store was in a seedy location 20% of the time? The billboard owner sold it as is. So you either take it or leave it. Most business owners would buy it and deal with the risk. That is what we've seen play out on YouTube and Facebook.
Edit: I will add that sophisticated advertisers are shifting their performance metrics from pure lead-generation sales or site visits to incrementality measurement. They want to measure if ad exposure changes consumer behavior. Perhaps we will see that FB and YT have high influence or not or something in the middle. The changes in measurement will have major impacts on advertising spend.
>Sounds like Verizon’s Facebook advertising spend is losing value because if COVId-19
“We’re pausing our advertising until Facebook can create an acceptable solution that makes us comfortable,”
Doesn’t sound like it has anything to do with Covid-19 to me but rather advertisers don’t want to spend money advertising on a platform promoting hate speech.
But let’s say this was a conspiracy by all these companies to save their ad dollars because they are being wasted on FB, why would they be afraid of the “implications of their reduced ad spend”? Certainly there is nothing wrong with these companies coming out and saying we are not going to spend money advertising on FB because it’s a waste of money. What else is the implication?
I see it as a "kill two birds" situation. Corporate ethics is a very different beast from human ethics. Getting any decision through a board room typically requires at least two entirely plausible value propositions.
> Doesn’t sound like it has anything to do with Covid-19 to me
Advertising is one of the first things companies cut during a downturn. Their revenues are down and they need to shave some costs.
Where do they make that budget cut? It's a pretty easy call right now. They can shave some money and garner some easy positive press at the same time. They are getting advertising for cutting spending.
When their revenue starts to come back online, they quietly turn Facebook advertising back on. If anyone calls them on it, they can say they feel the atmosphere on FB has improved.
> Advertising is one of the first things companies cut during a downturn. Their revenues are down and they need to shave some costs.
Ok but did they cut advertising across the board or just Facebook?
You can’t have you’re cake and eat it too, either Facebook advertising was effective and they are harming their own business by cutting Facebook advertising (Suggesting there is more than money involved in the decision), or Facebook advertising is a waste of money in which case they won’t just quietly turn it back on as you claim.
It's likely they reduced advertising spend across the board, while cutting Facebook entirely.
> You can’t have you’re cake and eat it too, either Facebook advertising was effective and they are harming their own business by cutting Facebook advertising (Suggesting there is more than money involved in the decision), or Facebook advertising is a waste of money in which case they won’t just quietly turn it back on as you claim.
Of course there is real money involved. But the current political/ economic situation has made Facebook advertising less valuable than it was previously.
I suspect COVID-19 is making it easy for a lot of advertisers to drop FaceBook right now. Ad budgets are down and likely to stay down until this blows over.
If a marketing department is just told to reduce spend by 90% they will still be running some of their highest-ROI campaigns on Google and Facebook. Completely pausing Facebook means it's about something more than just budget cuts, because even with a reduced budget marketers always want to have at least a small presence on Google and Facebook since the ROIs are so high for the best campaigns.
The real reason doesn't matter. If a company leaves and says it's due to Facebook's promotion of hate speech then there's no way that company can go back to advertising on Facebook before that changes (it'd look like a change of heart, and that now they think promoting hate speech is OK). Facebook are seeing a drop in ad revenue no matter what, and the only way to get the companies back will be to change. Maybe FB don't care about getting them back, but I suspect that's not likely.
What if they are just , “... pausing our advertising until Facebook can create an acceptable solution that makes us comfortable”? because they don't feel Facebook has acted in a manner consistent with their perceived values?
While they basically advocating banning people in favor of corporate sensibilities. Cannot have something ugly in their ad spaces Normally I wouldn't even care, it is what I expect from ad-tech. But I think I will remember that. There were other companies.
> Sounds like Verizon's Facebook advertising spend is losing value because of COVID-19, so they're using this a way to redirect focus away from the negative impact on their business.
My first thought on all these "boycotts". Are we cynical or is there any proof of this?
It's hard to phrase this in a way that doesn't sound snarky, but I mean it sincerely: Would you rather they become more like Twitter instead? Promoting virality is promoting outrage content, full-stop.
Honestly? I think all political advertising shouldn't be allowed, it gives those with a disproportionate amount of capital a lever of influence that runs counter to the democratic process. If you want to push an issue you should have to organize people who believe in your cause and have them involved. There's been plenty of examples of microtargeting's influence that makes me think it has no place in the political discourse.
Yep, it's pretty much how campaigns here in Germany work. There's about a few weeks of campaigning during which political posters and so on can be put up, but otherwise there's strict regulation on political ads.
Also the parties are significantly publicly financed and the amount of money is much lower, due to the much shorter campaign span, making the process much more egalitarian. For example the largest party in Germany, the CDU/CSU spent 30 million for the entire 2017 general election campaign (about 30-40% of the vote generally), and the smallest parties spend a few million with about 5% of the vote. So not much difference.
I'm completely shocked when I see US candidates in primaries spend tens of millions, or individual senators.
How does that work with FB? Let’s say you have a German politician with a subreddit about him. Does that not count as advertising? I’m genuinely curious because I’m certain your country has at least considered this scenario.
Up until now there hasn't really been laws addressing social media which falls outside of what is considered "Rundfunk" (basically television and radio mainly), but over the last year or two a lot of people have started demanding to apply the existing laws to social media as well. I think at the moment they're only required to label paid political ads.
Culturally though it has a greatly diminished role. If I remember correctly, during the last European election the largest parties spent about 500k on social media ads. We're still overwhelmingly dominated by traditional media. Angela Merkel has no social media presence, and if I had to guess even the most popular politicians maybe have a few ten or maybe a hundred thousand followers on Twitter.
Someone running for parliament in the UK, for example, is allowed to spend about $0.26 per voter † in an average constituency (of 72200 voters).
It's certainly not a perfect system, but it does mean if you earn £100k it's very easy to become an MP's largest donor.
† (The rules are more complicated than that, of course - there's separate spending by the national party, one free mailing by the royal mail, rules for tracking the equivalent value of volunteered professional services, and so on...)
How would you organize people to your cause without doing anything that would be considered 'advertising'? Unless you narrowly define advertising in a way that is easily worked around..
Same way we can have an open discussion on this lovely site we call HN.
While I'm not going to claim to know every definition of advertising, generally if money changes hands for priority over organic traffic that fits the bill pretty well for me. Doubly so if you're able to target specific categories and demographics. I think what makes microtargeting so bad in particular is that you can do things that would be negative to the broader public but narrow the scope so you have multiple sides of a campaign that doesn't let the public have a reasonable view of that campaign/issue as a whole.
What you're calling the democratic process is simply people willing to spend capital on a cause. It's just that their capital is time (and time is money). It doesn't make them any holier, and there's nothing morally or ethically superior about having to "organize people" without spending money. Put another way, I may be able to exert my political voice using money and I am not less deserving of having my opinion heard or any less deserving of influencing others than someone whose primary input is time (in lieu of other life pursuits).
“Time is money” is a cliche, not a fact. There are plenty of people who have lots of money but didn’t spend commensurate time getting it, as there are plenty of people who spend inordinate amounts of time making little money.
Sure. You can earn more money per unit of time by creating greater value for others. But my point is that saying "political spending is bad" doesn't make sense. Everyone is expending unequal efforts in different facets of their life. If I am busy keeping my small business afloat and can't afford to put in the kind of time a dedicated activist puts into organizing, I think I should still be able to use what resources I have to influence politics.
Otherwise, what we're saying is that everyone must dedicate significant portions of their life to on-the-ground organizing and direct action to be on an even footing relative to others. That doesn't sound like the kind of society most would want to live in. It means we'd need to forego other activities, both economic ones and leisure, just to engage in this artificially constrained political system.
I was just pointing out the foundation of your argument is categorically false. We can quibble over the rest - such as “creating greater value for others” being a completely arbitrary concept. Perhaps a better argument to make for your position is that money collated by organizations such as the ACLU, BLM (or the NRA), is used for political advertising, and therefore justifiable. I would personally find that argument difficult to refute. On the other hand, I personally think 100% of lobbying, which includes political advertising, should be illegal.
> You can earn more money per unit of time by creating greater value for others.
The majority of wealth that gets funneled into politics does not come from people who have high wages, it comes from capital invests or directly from corporate donors. This directly means that those for whom the system already works well have an outsized influence in making sure that the system will work even better for them in the future.
> That doesn't sound like the kind of society most would want to live in.
I think you need to recalibrate your understanding of what people want. Encouraging people to get involved in their communities and government sounds way better than making it necessary for politicians to solicit bribes (politely called fundraising) to keep their jobs.
Is it really that difficult for you to understand that being a squilloraire gives you the ability to politically out-maneuver almost-everyone-who-isn't?
What kind of mental gymnastics do you have to perform to disregard the tone of this particular global conversation?
At least Twitter is mostly public. That allows stupid stuff to be opposed, and harmful things to be reported.
With Facebook, and especially Groups, people are fully immersed in their self-selected filter bubble, and admins can run their colloidal-silver-scams without interference.
Could we prefer they no longer exist? Examples: there’s nothing an oil company can turn into that continues to sell oil in a non harmful manner. Altria tried to adopt vaping (still harmful) to move away from cigarettes (very harmful!).
Some businesses and their products should simply not exist due to the harm they cause. I apologize upfront if this doesn’t seem genuine and instead, unnecessarily controversial.
I'd like to hear the arguments behind the downvotes you're getting. To me, it seems that there are some things that, for the sake of the continued existence of our species (and countless others) on this planet, must simply be seen with clarity.
Our economy cannot currently operate without oil. Even if we replace it for energy production, we still need oil to produce other types of products.
Saying we should move towards using significantly less oil and that companies should pay for the negative externalities they cause is rational, saying oil companies should fundementally not exist is irrational.
Similarly, while I find the way that cigarette companies operate to be abhorrent (specifically they way they use international law to fight packaging and health laws), people deserve the right to smoke if they choose as well as the right to be free of abusive advertising of dangerous products.
We are able to synthesize methane from electricity+air with high-enough efficiency to use it as a chemical source. Some exotic stuff like asphalt might be difficult to synthesize, but most uses should be replaceable with a methane-based synthesis. Theoretically we could start a tax that progressively dis-incentivizes crude oil and natural gas extraction, but this is going to be hard unless US, EU, and CN agree on this, because the economic advantages of operating a refinery that stamps "synthetic" on their fossil products would be massive.
All of the companies doing this right now are 'pausing spend' rather than redirecting. They're reducing their marketing budgets and pointing the finger at Facebook so no one looks too closely at the implications of their reduced ad spend.