Facebook’s growing advertiser boycott could cost it almost $76m (£61.6m) after major companies joined in the protest against its hate speech policies.
Coca-Cola, Honda, Hershey’s chocolate and Unilever, the world’s largest advertiser, all said on Friday they would freeze or cut US spending on Facebook and sister service Instagram, wiping an estimated $56bn from the social media giant’s value.
Based on current pledges, that would deprive the social media giant of tens of millions of dollars this year, according to analytics company Pathmatics.
Facebook said it would ban a “wider category of hateful content” in adverts in response to anger over its failure to moderate violent and hateful content.
Mark Zuckerberg, chief executive, said Facebook would add notes to posts that are “newsworthy” but break platform rules - following the lead of Twitter, which has used such labels on posts from President Donald Trump. The advertising revenue loss could hit $255m if Procter & Gamble, Facebook’s biggest spender, follows through on hints it might join the boycott.
Yet even that would amount to only 0.8pc of Facebook’s expected US revenue for 2020, indicating the uphill struggle confronting any protester hoping to dent its bottom line.
William Merchan, Pathmatics chief revenue officer, said: “I would definitely be worried. Now this is at the level of brands like Unilever, it’s going to have a direct impact.”
The boycott movement has gathered steam after Facebook decided not to remove a post by President Donald Trump that appeared to threaten deadly force against protesters.
On Friday, Mr Zuckerberg announced a new crackdown on hate speech and voter intimidation, including a warning label for posts which break its policies but remain online because they are “newsworthy”.