Hot Topix: Advertising's Future Without Facebook

It remains to be seen whether the advertising boycott of Facebook will impact the way Facebook handles hate groups on its platform.

Since the Anti-Defamation League launched #StopHateForProfit, well-known brands like Colgate, SAP, and Puma are leaving Facebook’s advertising platform in droves.

Why do advertisers care? Will this change Facebook’s policies towards hate? Will advertisers return to Facebook?

Advertisers feel that hate groups on Facebook are poisoning their brand messages. Mark Zuckerberg seems unconcerned—he believes they’ll be back.

Without Facebook, will advertisers become extinct, merely survive, or thrive?

Transcript

Henry : Hey, everyone. It's Henry, Mike, and Chris of The Decentralists and it's time for another hot topic. It has been a pretty interesting week because everybody's talking about the advertising boycott on Facebook. So I know that Mike and Chris have a lot to say about this, so, Mike, would you like to start us off?

Mike : Sure, Henry, I'd love to start us off. So, what we want to talk about this week is the-- You know, it started as a trickle. I think with Mountain Equipment or North Face, I think was one of the first ones, and it's now become a veritable deluge of big name brand companies that have been joining an online campaign called Stop Hate for Profit that was put together by the Anti-Defamation League amongst a bunch of other folks in the United States to call attention to the idea that social media - and if you look at the Stop Hate for Profit site, they really are keying on Facebook here - are providing a platform for the spread of hate and racism and misinformation.

Henry : And when did that start? When did that start, Mike? Do you know?

Mike : I am not certain. But I would say what, Stop Hate for Profit, I think the first time I saw it was about a week ago.

Henry : Yeah, okay.

Mike : Maybe a week and a half. So it's very, very recent. And I think it really started kind of from this point where Facebook clearly diverged from the rest of social media, when they were kind of the one lone standout in this debate about censoring or putting warning labels on the content that was coming out in political advertising, specifically from Donald Trump, over the platform. And so I think it was that thing where Mark Zuckerberg has consistently been standing up saying that he should not exercise any kind of blocking. Even if these ads are knowingly false, they should be allowed to go on there because that's free speech. And I think this is clearly a combination of that type of cavalier attitude with the outrage that the Black Lives Matter movement is bringing to the forefront of society. And I think what this is, is you're seeing an undercurrent of people who want to use this opportunity the pandemic is providing us, they want to be able to reset, and they want this to be a more equal and just world. 

Henry : No, it's completely valid.

Mike : So fixing social media is clearly one of them. And one way to fix is to draw attention to the problems so that you can basically say, “Hey, we want you to fix this.” So the challenge is how effective is this going to be? So Chris, what do you think? How effective is this boycott actually going to be for Facebook?

Chris : First off, it has resulted in around 200 boogaloo boy pages being banned from Facebook. 

Mike : Well, that's a good thing.

Chris : That much has happened. And that is one positive thing because those folks really were calling for violence. One of them was responsible for killing two policemen over in California. And so the less boogaloo boy pages, the better. 

Henry : Yeah. 

Chris : But Mark Zuckerberg himself has reportedly said, “They'll be back.” So basically, I don't think Facebook is going to change their behaviour, change anything, for as long as they believe that these advertisers are going to be back.

Mike : Yeah, you're probably right there, Chris. And that's really sad. But why now? Why do you think they’ve started now? Is it just because of the attention to the Black Lives Matter and kind of the political advertising? Or what do you think it really is?

Henry : I think it's actually more than just what's happening right now with Black Lives Matter. I think it's also people are fed up with the political lies that have been propagated throughout Facebook. And that's part of it. Chris, what do you think?

Chris : It's shown to me that Facebook has been crazy inconsistent when it comes to fact-checking. 

Mike : Right.

Chris : So for example, they will not fact-check what Trump says but there is a Republican anti-Trump movement called The Lincoln Project, they put on an ad, an ad that was to most eyes deemed factual and Facebook decided not to run it because it wasn't factual enough.

Mike : Really?

Chris : So there's definitely a problem with inconsistency with Facebook and this has been known for a long time. As soon as Peter Thiel invited Zuckerberg and Trump to have lunch together, we knew this was going to be a problem. And we knew it was going to be a problem as well when Zuckerberg basically said, “It's not our job to editorialize the truth,” when in fact it is their job, they're a publisher, they go ahead and do that. So if you're an advertiser, you want consistency. You want some sort of foundation where you could go, where you could be sure of the message that you're trying to bring out. 

Henry : Exactly. 

Chris : And if Facebook can't provide that, well, advertisers, they're going to want to run away.

Henry : Yeah, that's very important, Chris, because I remember I used to be involved in advertising years ago and consistency is very, very important. They want to know, if they're going to spend their money, they're going to get this type of audience, and that breadth of audience, and the listeners or the viewers or the readers that they want, and they have to trust that that's what they're getting. Now, they already have figured out Facebook is what it is. I mean, who knows how many people actually read the things, but they are getting some value, but are they getting value enough to--? Well, Mike, you said earlier, if they decide to stop advertising on Facebook, how valuable really is it to them? 

Mike : Right, and I think clearly that is a point. Sorry, Chris, I'll toss it right back to you. But I think you're right there, Henry. You know, let's face it, advertisers advertise for one reason - to sell more stuff. And I think that unfortunately, truly because of this, this is clearly, to me, a bit of an indication that potentially the value of advertising on these platforms - and let's say specifically at Facebook - may not be as high as people tend to think it is. I think there's money that's spent, but [for] big brands, Facebook is a place to build a community, it's not necessarily a place to advertise as their number one criteria. And I think because of that, they have a bit of leeway here to try to push a political agenda to keep the platform as agnostic as possible, so that their message doesn't get confused, or kind of interrupted.

Chris : So I used to be in charge for Facebook ad buys for a major national corporation. 

Henry : Ah!

Chris : Here's my experience. Okay, so I put up an ad, it was a very simple ad, not too complex. But here's what Facebook does. They have an ad network. So when you buy a Facebook ad, by default, it doesn't just show up on Facebook itself, it shows up on their ad partners. And here's the problem. They don't tell you who their ad partners are.

Henry : Yeah, who are their ad partners? I've never heard of that.

Chris : Well, let me tell you what happened. So I put an ad up, and the ad ended up on Breitbart. 

Henry : Oh, really? 

Chris : That's right. It ended up on Breitbart. And as soon as it ended up on Breitbart, we got inundated with emails from folks who were telling me that they were going to boycott us for advertising with Breitbart. 

Henry : Wow.

Chris : And, basically, what could you say, right? Because, hey, we chose to advertise with Facebook. We couldn't choose where the ad ended up, but Facebook decided, hey, Breitbart just automatically, that's where our ad was going to show up. So my client, they had to dial back the Facebook ad spend.

Henry : Just for one second. That's fascinating, Chris, I find because in traditional advertising, as you may know, if you buy a TV spot or a spot in a newspaper, or a radio spot, not only do you pay for that individual spot, but you're able to choose virtually the exact time that it runs.

Chris : Exactly. So this is a major flaw with Facebook advertising. And if I were a brand, I would have pulled advertising from Facebook years ago. In fact, it doesn't surprise me that they're fed up right now.

Mike : So why do you think they stay, Chris? I mean, honestly, this can't be an isolated incident, right? Clearly, some of these brands that are currently in boycott have probably had that phone call or those email threats. “Why are you advertising on Breitbart?” or some other kind of right-wing site? So why are they still there? What did you get on the back end out of Facebook that maybe you don't get when you're buying it from a television station?

Chris : Well, statistics can be very addictive. 

Mike : Right.

Chris : When you see that graph that says, “Hey, you reach this many people. They saw your ad for this amount of time--” 

Henry : Is it something from Facebook that they provide to you?

Chris : It's a service, right? 

Henry : Okay.

Chris : Because with traditional advertising for radio and television, they can't exactly tell you how many people specifically saw your ad, right? They could give you estimates based upon Nielsen but it's not exact numbers. 

Henry : Correct. 

Chris : Exact numbers is what Facebook can provide you. And they could provide those numbers not just based upon how many people surf Facebook, but there's a thing called a Facebook pixel. And if your website has a Facebook pixel, Facebook could tell advertisers, “Well, this is the amount of people that saw your ads on our partner websites.” Okay.

Henry : Wow. 

Chris : So that's very addictive, if you're an advertiser, to know how many people exactly saw the ad and how many people followed through with a click to your website. 

Mike : Right. 

Chris : And that's the reason why advertisers don't entirely want to leave Facebook. Because up until the Googles of the world, and the Facebooks of the world showed up, nobody was able to say for sure whether or not their ads were effective.

Mike : This stuff is fascinating, because I can imagine the very first brand that received a presentation from Facebook that showed them the statistics, it must have just blown their mind. You know what I mean? Because it would be incredible insight. But clearly, the insights either have changed or are not as valuable, or-- I mean, we've had this discussion, I think even on this podcast before about the fact that, for example, up to half of the people on Facebook, up to half of, theoretically, the results that come from the pixel are fake.

Chris : Well, the way I liken it is Mark Zuckerberg is basically the wizard from The Wizard of Oz, he looks high and mighty. But a lot of this stuff is based upon an illusion. And the illusion is specifically Facebook statistics. So Facebook will show you stats about reach, Facebook will show you stats about likes, influence, all that other stuff. But from an advertiser’s perspective, the only statistic that truly matters is, “Did my revenue grow because of it?” 

Henry : Yep. 

Chris : And Henry, you could attest to this, living in the advertiser world, right? 

Henry : For sure.

Chris : That's the number one statistic that should matter. Let me give you an example of why stuff like reach on Facebook is an illusion. So about a few years ago, I noticed that reach for video on Facebook exploded. And so I'm looking at these stats and I'm thinking to myself, “Wow, video must be super effective.” Well, I decided to see what a view meant for a video. On Facebook, from Facebook's perspective, a view is somebody glanced at your video for one second.

Henry : Oh, okay. So in other words, instead of just looking at a static ad, if the advertiser provides a video type ad, then Facebook is claiming that it's much more effective.

Chris : That's what they're claiming. Now, the problem with one second equals one view is, well, if you're scrolling down a feed, and you pause just for a moment to move your thumb, that now counts as a view. 

Mike : See, I wouldn't count that. Who would count that? Who counts one second? 

Henry : Well, yeah, and that’s how you skip ads too. 

Mike : Well, this is what I'm saying. I mean, this is ludicrous, right? So it’s basically, getting a pie chart that says you’ve got reach of 8 million views of one second. What does that mean to you?

Henry : So Chris, back to your story, which, sorry, we jumped in there but you discovered that there's some great numbers for reaches for video, then what did you do?

Chris : It made me question, “Well, is video really that more effective than other forms of advertising on Facebook?” And I asked, “Well, why is Facebook creating this narrative of video being more effective than other forms of advertising?” And what it came down to is that Facebook is trying to compete with YouTube. So basically, they had to prove to advertisers that their video ads are more effective than YouTube ads. So this is once again the problem with stats - they're illusory. 

Henry : Yep. 

Chris : Right? Zuckerberg is the wizard, and he's just making the illusions.

Mike : Okay, so then let me ask you a question. Can they live without these stats? Can we go back to a world where let's say I call it something like the golden age of advertising? I mean, I remember advertising when it was literally this game competing for people's attention. And so the ads were fantastic. And there were lots of awards, and they were things like this. Whereas nowadays--

Henry : Yeah, like Superbowl, and come up with a production that really engages you. And actually, that's what sells a product, not just a quick view of this and that, because our brains have evolved because we've been bombarded by media for decades to ignore that. But if you get something that engages you, like a great ad, with wonderful, creative, you’re sold.

Chris : Henry, you are 100% on point. My mentor, the fellow who got me into the social media industry, he really pushed a motto onto me, that's become my life motto when it comes to content on the internet, which is, “F,” and you know what I mean by “F,” “F stats make art.”

Henry : Oh, nice. I like that.

Chris : I think we all need to get back to making art. And I think we need to come at this from an angle of “if the art is amazing and we do a great job with content, then the stats are going to follow,” right?

Mike : Right.

Chris : But you can't make stuff just based upon stats. If you make stuff based upon stats, you can always fake stats. I can pay somebody overseas to view my video 5000 times. I can buy followers. I can buy clicks. If all this advertising is just about showing my boss that I'm able to get stats, well, what's to stop me from just paying five bucks to some fellow to give me the stats I want?

Henry : Right. So yeah, Mike, your question was, can they manage without this? And we’ve mentioned, okay, it's got to be engaging, creative advertising but still, that would be tough to present to people through social media?

Mike : It's not a question of presenting it through social media. As long as the platform is centralized and somebody like Mark Zuckerberg or Jack Dorsey, or whoever - insert SEO name here - controls kind of what you see in your feed, then it is not really truly an advertising conducive medium, if that makes sense. I think that what advertising has become-- Because we're now, I think it's like 50% of the global ad spend is on digital media right now. 

Henry : Wow. 

Mike : Okay, and that's probably what, in the last 10 years, it's gone from maybe 5% to 50%. And it's because of these statistics. It's because they've been sold this bill of goods that says, “Because I can give you a pie chart and a little graph and all this stuff that looks really good at the end, showing that there was engagement with that content you created, which I control, and I disseminate, and I generate the statistics.” So as Chris mentioned, it's easy to fix the game. I mean, if he could buy followers and, in some place, Facebook can provide them for free if they want to mislead an advertiser with statistics, I mean, let's face it,

Chris : You could pay Facebook for followers. 

Mike : Totally. So this is what I'm saying. So it means absolutely nothing. It means nothing. So you could not put a context around it. So this is kind of why I look at this as, is this an opportunity for real honest to gosh, creative-driven advertising to become the foundation again of advertising?

Henry : Interesting.

Mike : You know, where people actually have to compete on an open platform. Because if you think about it, the reality, the reason why these guys have got the statistics is because Facebook and Instagram and YouTube and all these guys have control of the throttle. They can turn it on or off and what goes where and all this other kind of stuff. So you can't really now believe those statistics. So if I'm a big brand advertiser, what I'm starting to think about is, how do I kind of get back into this thing where I Nike or I Starbucks or I Coca-Cola, [am] communicating directly with consumers to try to win them back? You know what I mean? To get them. 

Henry : Yeah.

Mike : And so to me, there's this, I'm stuck in this kind of nether land right now, where the platforms that exist, do not actually give me the ability or the ownership or the control of the method of building my community with the people that I want to influence. And I would argue that if we could go back to the days of television advertising, and every single TV had a box on top from Nielsen that could tell you exactly how long they were looking at your ad for, they would probably rather do that knowing that it was an honest competition than knowing that Nielsen controlled the throttle to the television set.

Henry : Yes, I see. In other words, Nielsen-- Oh, that's actually fascinating, because you're right, in that analogy, Nielsen was measuring, but they were not broadcasting, and they were not creating.

Mike : They were not broadcasting. That's right. They weren't the CBC, they weren't ABC, they couldn't force you to go to that channel. All they were doing was reporting what people actually did. And so remember, that's why you'd have those ads; it was like Super Bowl every primetime TV show. You'd watch a really awesome ad by Coca-Cola, and the next time the commercials came on was a really awesome ad from Pepsi. 

Henry : Yeah. 

Mike : And it really made you think, “Hey, do I believe this to go and make this change?” And if you could report those statistics in an honest manner, I bet you Coke and Pepsi would go back in a heartbeat.

Chris : Funny that you mentioned that, Mike, because probably the most effective ad of all time is that Coca-Cola song from the 1970s. 

Mike : Correct.

Henry : Yeah, “I'd like to teach the world to sing.”

Chris : Exactly. That ad is what, 50 years old and Henry, you're singing the lyrics?

Henry : Well, I just did the first line. I could do the whole song, but we don't want to hear that.

Chris : Of course. But that ad is 50 years old. Right? 

Henry : Right. 

Chris : And the fact that you're able to sing it. And when was the last time that ad was even shown?

Mike : Probably in a museum.

Henry : I actually saw it at the Coke museum in Atlanta about 10 or 15 years ago.

Mike : There we go.

Chris : Well, there you go. You saw it in a museum 10, 15 years ago, and you still remember it. I think advertisers need to get back to making art. Advertisers need to get back to finding creatives, building a really compelling message. And then after they make art, good, compelling, beautiful, wonderful art, they should find the social media platform that allows them to state their message in the best way possible.

Henry : Directly to their audience, as opposed to going through the centralized server and all of the algorithms and--

Mike : Correct.

Chris : Exactly. If you're an advertiser, you shouldn't be afraid that your ad will end up on Breitbart or will and end up being on a boogaloo boy page. If you're an advertiser, you should have clarity that your message will be distilled in a way that will not be compromised.

Mike : Hey, and let's take it one step further because we're getting into a really interesting place now. Okay, so we have a social media network now where you control, you kind of have to let's say compete on an equal level to be heard by people to come and make a decision. But what you also now have, Henry, to take that Nielsen box analogy another level, if you basically put a Nielsen box on a television to track what shows you were watching and what ads, and then you gave the consumer the opportunity to talk directly to the brand, right there, while they watch that classic Coke ad--

Henry : You mean react to the message--

Mike : Join the community right now. I mean, that's the promise of social media, right? 

Henry : Yeah. 

Mike : What they're buying is they see these statistics, they chop down their ads to try to resonate in one second, there's no room for art or creativity to Chris's point. They aren't advertising anymore. These aren't brands anymore. This is social media marketing and influence. And it's because they can theoretically then communicate with people on a platform where everything is vanilla. Whereas if there was a different platform where every single engagement that you had as a brand was with a person who voluntarily was interested in your brand because they liked the solution, or the product, or they liked the ad, they thought it was a catchy tune, and for that reason, they're going to interact with you, now you actually have a real honest to gosh, human being, who's going to make a purchasing decision. And you can communicate directly with them and keep them and own them and improve your brand and do all of those wonderful things that brands want on a network and in an environment where you don't have to worry about the guy running the network being a Breitbart supporter, or a sociopath.

Henry : Yeah, exactly. So that's screaming for a decentralized social media platform like Peer Social’s Manyone.

Mike : Absolutely. And that's kind of the point. One of the things that we kind of feel is going to be an important kind of eventuality for this is the win that it gives to advertisers and kind of the ability it gives to, say, ad agencies who create art, to step back into the ring, and actually make the world a better place.

Henry : All right, so what you're saying basically is having a relationship on Manyone with not only your friends and associates and your family direct, that you can cancel anytime, but you could also if you chose, have a relationship to one of your favorite brands, and you can accept messages from them or not.

Mike : Absolutely. Because every connection is voluntary. 

Henry : Yeah.

Mike : I mean, that's the whole point of decentralization, there's no central authority. 

Henry : Right!

Mike : So there’s nobody controlling what's coming to you. So if you actually go and you watch a Nike ad, or a Coca-Cola ad, or a Starbucks ad, it's because you actually chose to do it. And that's fundamentally, to me at least, a paradigm-changing event for advertising and for brands. If we could make what people saw on a timeline or a newsfeed or whatever a voluntary event, that would increase the value of engagement over a social media platform by 1,000,000%. And it would provide room for the romance and the art, and the creativity that ad agencies used to bring to the mix back into the fold. Because right now, most of the major ad agencies are going out of business because they don't have enough clients to support themselves anymore.

Henry : Right. So Mike, Chris, when will the beta of Manyone be available?

Mike : Oh, wow, Henry, you always ask me that question, you always put me in a trap. But I am cautiously optimistic we'll have something out for everybody to try within the next four to six weeks. We are hoping that by kind of in the summer, before the summer's over, we will have Manyone out in public hands and having people testing it. And that will be the basis for a revolution in social media and a revolution in advertising.

Henry : Very much looking forward to it. Mike, thank you so much for your insights. And Chris, man, I learned a lot from your experience with Facebook. Thank you.

Mike : Thank you, Henry.

Chris : Thanks, Henry.