Advertisers unfazed by latest Facebook bombshell

The social network is unlikely to lose any marketing dollars despite being rocked by yet another scandal

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Credit: Illustration by Tam Nguyen/ Ad Age

Facebook advertisers are once again turning a blind-eye to the issues plaguing the social media giant after a New York Times report detailed a pattern of willful stonewalling, delaying and obfuscating around a series of urgent problems.

But brands and ad agencies should be more critical than they are, say some industry executives, who have been watching Facebook unravel over the past year, with data mishaps, a high-profile hack and struggles with bad actors gaming the platform.

"It's kind of amazing that no one cares at all," a managing partner at a major advertising agency tells Ad Age. "All these companies are talking about purpose, and higher alignments for their brands, and not a single client has raised a red flag about any of this at Facebook."

All year, the advertising community has publicly called for a reckoning in digital advertising, with brands like Procter & Gamble demanding more from the platforms around transparency and trust. Yet, as Facebook has become the outward face of the industry's most intractable problems, and continues to disappoint with its responses, few brands are changing their spending.

"No one has yet heard of a client pausing or even easing off the gas," says a second agency executive.

The Times report shined a light on Facebook's internal crisis management patterns and revealed that Facebook hired the public relations firm Definers Public Affairs to handle damage control following the Russian infiltration of the social network, a problem that also afflicted Facebook's major rivals and influenced traditional media's coverage of the 2016 U.S. presidential election.

Facebook—primarily CEO Mark Zuckerberg—was outwardly skeptical that Russian meddling had much of an effect, but the report claimed the company was more aware of its problems than it had disclosed.

Definers handled spin control for Facebook, especially targeting Washington D.C. lawmakers who will decide the future of regulation of the entire industry. Definers, a firm with ties to Republicans, tried to throw Washington off Facebook's scent and turn it toward Google and Apple, the latter of which has been increasingly vocal about the social network's problematic data and privacy practices.

"I have worked in this industry for 25 years, and I wouldn't still be at Facebook if I didn't believe that we are accepting full responsibility for our mistakes and taking serious action to address them," Carolyn Everson, vp of global marketing solutions, who is the main point of contact between Facebook and the ad world, said in a statement. "We've made mistakes, but to suggest that we aren't focused on uncovering and tackling issues quickly is not true."

A number of advertisers, many of whom spoke only on condition of anonymity for this story, said there was little fallout from the exposé, and advertising would likely proceed as usual.

Anheuser-Busch InBev is not pulling its Facebook advertising, but is "continuing to watch this closely," a U.S. spokesman for the brewer says.

Daryl Lee, global CEO of UM, a full-service marketing and media agency network of IPG Mediabrands, says brands will keep working with Facebook because it's in everyone's interest that the social network is a safe place where people connect and brands participate.

"This is not a question of whether Facebook has no morals but whether they have all the necessary controls in place to make the Facebook environment as brand safe as possible," Lee wrote in a statement.

Others have been more straightforward. "Nothing that's happened materially changes the way our business is marketing on Facebook," says one media and entertainment advertising executive.

But that doesn't mean anything Facebook does gets a pass from brands, the advertiser says. The company lowered its ad spending this year following the issues with Cambridge Analytica, the third-party data company that allegedly abused the personal information of up to 87 million Facebook users, data it was able to access because of flimsy safeguards on the social network.

Facebook has since put in place tighter controls to prevent that same kind of mishandling of data from outside parties, but a picture emerged that the company was too blasé about how it shared personal information. That was why both Zuckerberg and Chief Operating Officer Sheryl Sandberg were called to testify to Congress this year, and partly why the company has been lobbying Washington so aggressively.

Meanwhile, Definers, which it fired after Zuckerberg said he didn't even know about the company's work with Facebook, was churning out negative reports about Apple on a media site it operates called NTK Network.

NTK Network was even buying ads on Facebook to promote its anti-Apple stories, and targeting them exclusively to Washington D.C. audiences, according to Facebook's ad archive. The archive displays all political ads that run on the social network, and it was created this year as a new transparency measure by Facebook following the problems with the 2016 election.

Kit Yarrow, a consumer psychologist who studies millennial consumers, suggests brands would be wise to pull their Facebook ads: "It's such an easy win because it deals with trust, the No. 1 consumer hot button issue," she says. "In fact I'd just make that case, 'what we value is honesty and transparency--if we can't trust our partners we can't do business with them.'"

Contributing: E.J. Schultz, Jack Neff, Jeanine Poggi

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