NEWS3 July 2020

Facebook boycott could hit brands’ ad effectiveness

Automotive Media News North America Retail UK

UK – Brands pulling advertising spend from Facebook as part of a boycott could see their advertising effectiveness impacted across other media channels, according to research from University of Oxford’s Saïd Business School.

Facebook on phone

Retailers who withdraw ad budget from Facebook and move it to other channels could see the overall ability of their campaigns to influence purchase intentions or motivations decrease by an average of 8%, the analysis found, while likelihood of brand consideration could drop by 25%.

The research also suggests that automotive manufacturers could see their audience’s purchase motivations drop by 13% and perceived brand saliency decrease by 6%.

The study was conducted by Jason Bell, associate professor of marketing, Andrew Stephen, associate dean of research and L’Oréal professor of marketing and Felipe Thomaz, associate professor of marketing, using a dataset on advertising campaigns across six industries – retail, technology, financial services, food and drink, personal care and auto – provided by Kantar.

The business school and Facebook have an existing relationship through the Future of Marketing initiative.

Major companies including Coca-Cola and Unilever have said they will halt advertising on Facebook for a month in a boycott over the platform’s handling of hate speech and misinformation.   

The researchers estimated the impacts on effectiveness of both individual components of ad campaigns (channels including Facebook, TV, radio, magazines) and the interactions between them. They estimated the impact on ad effectiveness of removing spend from the social network while assuming that overall spend is unchanged and the Facebook spend is reallocated proportionally across other media channels. 

According to the researchers, the reason for this impact is due to the way in which Facebook interacts with other media channels. Bell said: “By removing Facebook from their media mixes, brands hurt their overall advertising effectiveness in the remaining channels. This is because Facebook ads seem to indirectly help make advertising in many other channels more effective.”

Stephen added: “We believe it is right that many advertisers around the world have taken actions to draw attention to the propagation of unsafe and unacceptable content, such as hate speech, on social media platforms. From a purely commercial perspective, however, these findings suggest that pulling ads from Facebook will likely prove costly for brands.”