Influencers and their agencies are the unintended victims of the Facebook boycott
Ever since her husband lost his job in 2018, influencer Heather Castillo has been supporting her family of five as a content creator through her blog The Super Mom Life and social channels @thesupermomlife, where her lifestyle parenting posts reach around 150,000 people.
Castillo averaged a minimum of $8,000 a month for eight to 10 sponsored posts, enough to support her family through campaigns with some big brands. Then the pandemic hit. The number of campaigns she was working on were cut in half. Things were slowly returning to normal when brands began joining the Facebook ad boycott. Now, she says two of the brands she currently works with–whose names she didn't disclose–will be pausing campaigns through the end of July, even though the content was already created last month.
Even if the more than 400 reported brands participating in the Facebook ad boycott #StopHateForProfit don’t make a dent in the platform’s $70 billion ad revenue, they are certainly taking money away from the platform’s lifeblood–the creators and the agencies that work it. Just as the typically busy back-to-school planning period kicks off (a season that uses influencers heavily), brands are pausing their influencer campaigns along with the paid ones, wary of showing favor or spending any money with Facebook and Facebook-owned Instagram, if not other social networks like Twitter and YouTube.
While influencers with millions of followers and agencies with a variety of brand partners might be able to shrug off the boycott, for the majority of influencers and influencer-focused agencies, losing brand clients means losing a big chunk of monthly revenue, and if the boycott continues, who knows when they will see that money next. Several influencer agencies, who profit by taking a share from the influencers they represent, say they might have to resort to layoffs if the boycott continues for another month.
“Especially now, with the pandemic causing so many to be laid off from their regular jobs, influencers are relying on these sponsored posts for the income they need to pay their bills and put food on the table,” says Castillo, who said that 80 percent of her sponsored content runs on Facebook and Instagram. "Facebook will survive a 30-day boycott, but for influencers, that could cause hardship for them and their family they aren’t prepared for.”
Stuck in the middle
Elijah Schneider, CEO of San Diego-based Modifly, works on paid, organic and influencer social campaigns, and has witnessed a 46 percent drop in ad revenue from influencer campaigns in the last two weeks. “I feel bad for influencers,” he says. “The boycott was meant to hurt Facebook, but not paying Facebook hurts influencers.” He says several influencers he works with had left their jobs last year and are now making less than $2,000 a month due first to the pandemic and now the Facebook boycott.
Influencer campaigns are technically not part of the Facebook ad boycott terms. The boycott, launched by the NAACP, Anti-Defamation League, Sleeping Giants, Color of Change and other organizations in June, calls upon the platform’s 8 million advertisers to stop paid ads on the platform to protest how Facebook has handled hate speech. The organizers have stated that sponsored content, which includes brand-funded influencer content, is not included. With influencer sponsored content, the majority of dollars go to the influencer. Still, in order to get that content seen, brands and agencies are pressured to put money behind the posts.
“The algorithms of both platforms have made it such that it is very hard to get eyeballs on content without some kind of boosting,” says Danielle Wiley, founder and CEO at Sway Group, who said brands typically spend anywhere from five to 15 percent of a campaign budget to boost influencer content. “Advertisers may be hesitant to invest in sponsored content without the added performance of boosting."
Wiley says the agency has one client participate in the boycott so far, but believes more will follow. For now, the agency has shifted spend to other social platforms like Twitter, but is concerned should the boycott be prolonged. After all, while most brands are confining their boycott to Facebook and Instagram, some brands like PepsiCo, Lego, Pernod Ricard are pausing all social media spend across platforms for July or longer.
“While we fully support the Stop Hate for Profit effort and the 400-plus brands who are taking part, we also support our influencers, who are small business owners and not deserving of losing their revenue stream when Facebook is the one who should be held accountable,” says Wiley. “In our opinion, the potential effect on influencers simply isn’t worth forcing a participatory boycott.”
Agencies say brands can still participate in the boycott and not punish influencers by continuing with their campaigns without boosting the content. Birchbox, for example, has joined the boycott but says it will continue to support influencers by sponsoring posts. It will not, however, amplify their content with ad spend. Inmar Intelligence, a marketing company that includes influencer agency Collective Bias, says the company is offering brands an influencer-only proposal for Instagram and Facebook that does not include dollars to boost their content, so they can continue with the boycott, says Aaron Kechley, general manager of media and data at Inmar.
Brands can also shift their budget to other platforms like Wiley is doing, partner with influencers to get the word out about the boycott or pay influencers to boost their posts themselves. Shifting dollars to other platforms won’t necessarily help the boycott cause, though. “Simply blocking, or muffling, one outlet for hate will just push it out somewhere else,” says Mike Majlak, an influencer with nearly 3 million followers across platforms, which he says is the main reason he hasn’t seen a massive falloff in sponsored dollars.
Influencer agencies suffer Facebook's fate
Some influencer agencies have been hit harder than others, depending how many brands working with their clients have joined the boycott and whether they have diversified their offerings beyond sponsored influencer content. And although the boycott began for the U.S. market, it has now gone global with brands like Coca-Cola, Clorox, Danone, Lego and Mars Inc. suspending their global spend on social media, so international influencers and agencies are not immune to its side effects.
Arnab Majumdar, founder and CEO of Toronto-based influencer agency Peersway, which executes nanoinfluencer campaigns on Instagram, says 75 percent of its ongoing campaigns have been put on hold “with immediate effect.” Majumdar says some holds are coming from brands that have not even officially joined in the boycott.
“Typically this is a busy time as brands are planning their back-to-school campaigns, but this uncertainty has made brands, who are not yet part of the boycott, nervous and they are not willing to proceed with their campaigns,” he says. Of course, the pandemic is also a factor, given that there is still uncertainty about whether schools will reopen in the fall.
Because Peersway is an international agency, and works with brands like Unilever and Puma that have announced they have joined the boycott, country lines are making campaigns complicated, to say the least. The agency is working on two campaigns for Unilever–one for the Canadian market and another for the U.S. market. Due to the boycott, the U.S. campaign has been paused, but the Canadian one is ongoing. Puma, on the other hand, has paused its Canadian campaign with the agency, even though its boycott is in the U.S. The agency doesn’t know if it’s a part of a larger North American campaign or just meant for Canada and still got paused, says Majumdar.
Toronto-based influencer talent management agency Platform Media and Management has seen a 50 percent decrease in billings, and will now have to rely on the subsidies the Canadian government is giving to companies hit hard by the coronavirus, says Sara Koonar, president of Platform Media and Management. It’s suggesting to its clients that its influencers can use a disclosure on their posts so audiences understand they are being paid by brands directly and no compensation is going to Facebook.
Ultimately, influencers and influencer agencies say that the boycott is hurting them more than advancing the boycott’s cause. While a decline in advertiser spend might not spook investors (Facebook’s stock has risen beyond what it was before the boycott started) an influencer slump could trigger a declining audience which would arguably have a larger impact.
Contributing: Jack Neff