Zuckerberg: advertisers will be back to Facebook 'soon enough'

https://www.bbc.com/news/technology-53262860

by DarkContinent • 6 years ago

255 236 6 years ago

gruglife• 6 years ago

It’s so true. At the end of the day, users haven’t abandoned FB and that’s what advertisers care about.

wand3r2• 6 years ago

In some ways they have though, at least in terms of time allocation. When Facebook was in its heyday it was the default social network. They dont seem to be adding as many new users and I suspect they are churning old users. They also have to compete with wechat, twitter, tiktok, reddit, twitch, etc so its not obvious to anyone but facebook how loyal the userbase is.

Facebook is becoming less relevant so yes these companies will most likely be back, but what about 5 years? They might not be willing to pay the same rates. Facebook will kind of be like a personal email client that people check occasionally. Facebook.com specifically, Instagram itself will remain popular for a while I would wager.

ramraj072• 6 years ago

Does that make a difference then? Facebook's going to continue tracking the users all the same, their ad formats will just be different

shripadk7• 6 years ago

In some ways they have though, at least in terms of time allocation. When Facebook was in its heyday it was the default social network. They dont seem to be adding as many new users and I suspect they are churning old users. They also have to compete with wechat, twitter, tiktok, reddit, twitch, etc so its not obvious to anyone but facebook how loyal the userbase is.

But it has nothing to do with loyalty. It has all to do with algorithms. If Facebook's AI is superior to Twitter, Wechat, TikTok, Reddit and Twitch then advertisers will never leave Facebook. All Facebook needs is 30 seconds of user time to show them ads. Also don't forget the audience network that Facebook has. Are you playing a free game of Ludo on your mobile? You will be shown an ad in between games. That ad is served by Facebook. So it is not even necessary for the user to be on the platform to be shown ads! Now how do you tackle that? Publishers will also have to abandon Facebook. That will not happen so easily. The only way to tackle Facebook is to create an alternative that has at least 50% of the user base that Facebook does and also have an equally good AI Ad platform or superior.

Facebook is becoming less relevant so yes these companies will most likely be back, but what about 5 years? They might not be willing to pay the same rates. Facebook will kind of be like a personal email client that people check occasionally. Facebook.com specifically, Instagram itself will remain popular for a while I would wager.

Facebook knows that. That is why they are constantly improving their algos to make it cheaper themselves. Advertisers don't want access to a billion people really. They just need to sell to a few hundred or thousand people to make their profits. Even if Facebook userbase comes down by 50%, if the Facebook AI is half as decent as it claims to be, it will still find the right audience for advertisers to target!

MagnumPIG• 6 years ago

Depends which users. A lot of teenagers are "mostly on Instagram" or "only use it for Messenger". And teenagers are apparently an important population to marketers.

I know FB owns Instagram but the point is, Facebook as a platform may be past its prime in NA.

jehlakj• 6 years ago

There’s even a meme: Facebook is for boomers.

Idk how much of that is true, but apps like Instagram and tiktok are definitely talked about more these days

freyr2• 6 years ago

With the rise of TikTok, I wonder if Instagram is past its prime as well?

Most of my friends have stopped posting photos to Instagram, and just occasionally share stories now. But for short-form video content, TikTok seems to be growing much faster.

cm20122• 6 years ago

Facebook had more daily users in the US in Q2 than ever before. They've never had a quarterly decline.

newguy12342• 6 years ago

Advertisers just go to where the eye balls are at. Facebook has a good moat but places like reddit and twitter don't. There are already clones for both twitter and reddit. Some communities have left reddit and started their own standalone communities. Often times these communities are so tight-knit that most of the users leave the original platform completely. Same story for twitter. People are moving to a new platform called parler.

catacombs4• 6 years ago

At the end of the day, users haven’t abandoned FB and that’s what advertisers care about.

This goes, especially, to older people who couldn't care less and just want an easy platform to post political memes and gossip about the weird guys who come around the neighborhood in big trucks and snatch everyone's garbage from the curb.

wnevets2• 6 years ago

He is 100% correct. These advertisers have gotten millions of dollars in free PR for the "boycott" but that last won't long for most of them.

bennettfeely• 6 years ago

I really have a hard time believing consumer behavior is affected by these boycotts. Is the average person running to spend more at Starbucks or Hershey or Honda because they temporarily "stood up to Facebook"?

wnevets2• 6 years ago

if there is enough news about it, why not? There is a segment of the population upset at starbucks over their holiday cups.

EForEndeavour• 6 years ago

Analogously, does the average person run to spend more at Starbucks or Hershey or Honda because they scrolled past the same ad 10 times in a single day in their Instagram feed?

pphysch3• 6 years ago

Of course they will. The calculus has been done; the marketing boost from saying "we are pulling ads from Facebook (for X weeks)" apparently outweighs the actual value of those weeks of passive Facebook ads. And then things will be back to "business-as-usual" (although outrage marketing is business-as-usual).

shoguning5• 6 years ago

My interpretation of what's going on:

CEOs finally have leverage against their marketing departments to do black-out testing on social media ad spend. It's difficult to actually measure impact of ad spending, and marketing teams spin results to their advantage.

They will observe what happens and re-introduce spending where it actually works.

pphysch3• 6 years ago

I doubt this very much. Doing black-out testing silently would be just as easy and allow a much greater degree of experimental control.

ramraj072• 6 years ago

Well if it fails, and revenue drops, that would be hard to explain to shareholders right? Especially if the test has to extend for months to be realistic. Now they can at least say it's for a social cause.

shoguning5• 6 years ago

Maybe?

Part of the leverage is going public and saying it's about some principle.

For experimental control, executives tend to think simple is better. The more complex, the more room for fudging.

wand3r2• 6 years ago

Also, it is being done during one of the craziest markets and climate ever to occur so it would be difficult to really get good numbers.

fourstar2• 6 years ago

Bad take. These companies are using FB as a scapegoat to reduce ad operations during this pandemic/company budget reductions.

shoguning5• 6 years ago

Seems synergistic with what I said, no? Reduce budget and do some testing at the same time.

Aperocky2• 6 years ago

When a recession happen the first to go is marketing.

As a test, you would need to control other variables, the present economic uncertainty basically rendered that impossible.

It's just the CEOs finding a convenient excuse to cut costs.

adrianb• 6 years ago

It's an even better deal: companies are replacing paid advertising with free exposure from being mentioned in news stories and bonus points for "standing up for what's right". In addition, plenty of people (and the news organisations themselves) share these news stories on the very same social media, with 0 costs for the companies involved.

Overall it means increased brand exposure for less money.

jjohansson2• 6 years ago

When a recession happen the first to go is marketing.

As a marketer, I have found the opposite to be true for some industries. For example, during 2007/2008 my digital marketing agency saw a big surge in business from companies who saw marketing as a way to grow lagging demand.

efdb• 6 years ago

Zuckerberg: "We're not going to change our policies or approach on anything because of a threat to a small percent of our revenue."

Facebook Mission: "Give people the power to build community and bring the world closer together."

Please update the mission statement

JMTQp8lwXL3• 6 years ago

The results would be tainted by the free advertising brands get for boasting about cutting ad budgets.

hellomyguys• 6 years ago

It's difficult to actually measure impact of ad spending, and marketing teams spin results to their advantage.

Have you used any self-serve ad tool? It's quite easy actually.

sokoloff2• 6 years ago

It's quite easy to get a measurement on your screen. That doesn't necessarily translate to measuring the impact of ad spending.

If I have social media ads, paid search, and retargeting ads all live on multiple platforms, there is undoubtedly interaction among them and the quite-easy self-serve ad tool is likely to show me a simplistic "last click attribution" at best.

TeMPOraL• 6 years ago

It's easy to bullshit yourself into thinking your ads are much more effective than they really are. It's even easier to bullshit the people who pay you to do ads for them. Advertising and analytics platform happily oblige both use cases.

As 'sokoloff wrote, it's easy to get a measurement on the screen. But gaining real insight from it, or even knowing whether that measurement makes sense, requires a certain amount of analytical thinking and knowledge of statistics. Maybe among corporate marketing departments such skills are plenty, but in my experience, it's not usually the case with small marketing agencies serving smaller companies. Bullshitting has a better effort/reward ratio, particularly when your customers understand statistics even less than you.

nostromo• 6 years ago

2020 is very atypical and not a good time to run a "marketing off" test.

Even if you did an A/B or multivariate test across different markets, you'd probably be measuring local responses to Covid more than you'd be measuring Facebook marketing effectiveness.

politician2• 6 years ago

On the other hand, with stay-at-home orders media consumption is at an all-time high. Ads should outperform in this environment.

garmaine• 6 years ago

It doesn't matter. The test is "should we be spending money on this in 2020", not testing a hypothetical situation where the pandemic doesn't exist.

lalos• 6 years ago

With that same argument you can conclude that since 2020 is very atypical then it's not a good time to run the usual strategy of last year. Might as well switch it up, cut costs or react (in case they saw that ad clicks went up, but not the actual sales).

fullshark• 6 years ago

My interpretation: old media doesn't understand new media.

emmp• 6 years ago

It's not exactly blackout testing if the blackout testing itself is highly visible and gets positive earned media.

sanxiyn• 6 years ago

Let's See Your Treatment Effects!

https://www.youtube.com/watch?v=xd3gQAV1ncs

Run an experiment And let the truth fall out

usrusr• 6 years ago

Yes, I think it's a fault line that has been waiting to crack for quite a while. Facebook has never been a good match for those big household-name brands because for them targeted ads add very little value over blanket ads. They begrudgingly pay a heavy premium on targeting only because some demographics have completely detached themselves from blanket ad media. That's not how a happy customer relationship looks like.

Marketing departments (or external intermediaries) don't mind the lower value proposition at all, because they get all those micromanagement opportunities and (perceived) necessities offered by self-serve targeting platforms. Huge opportunities to look important. I wonder how the management overhead per dollar spent on ads has developed in the last 20 years.

neonate• 6 years ago

That is an ingenious interpretation.

Probably too ingenious though, especially across all the companies involved.

spootze• 6 years ago

Facebook is actually one of the few platforms (if not the only platform?) that allows running self-serve RCTs (conversion lift tests in their lingo): https://www.facebook.com/business/help/688346554927374

Conditional on them honestly reporting numbers, it's a pretty credible way to measure effectiveness in terms of incremental conversions you get by showing ads on FB/IG

Barrin923• 6 years ago

Of course he's right. If anything I'm surprised advertisers aren't cutting back more given how much revenue they're probably losing during the pandemic.

Real change has to come from two sources. Firstly regulation, Facebook will never "self-regulate" and this corporate activism is a joke. And secondly, from employees who in sufficient numbers have at least some leverage.

goodrubyist• 6 years ago

You do realize that regulating Facebook and other social media companies in order to force them to limit speech on their platforms would expressly violate the First Amendment? And, thank God for 1A, given the enormous amount of interest people have in limiting speech.

gruez2• 6 years ago

You do realize that regulating Facebook and other social media companies in order to force them to limit speech on their platforms would expressly violate the First Amendment?

Yet FCC is still around regulating speech on broadcast television.

sevencolors• 6 years ago

Why is this so hard to understand?

https://xkcd.com/1357/

randompwd• 6 years ago

Remember how Facebook operates around the world. Not just USA.

Barrin923• 6 years ago

that's not true at all. this congressional report[1] outlines the capacity of the government to regulate speech.

"However, the fact that a law affects speech protected by the First Amendment does not necessarily mean that it is unconstitutional. As explained below, the First Amendment allows some regulation of speech and does not prohibit regulation of conduct.[...]"

If a law does regulate speech, a court would consider the type of speech being regulated to determine how closely to scrutinize the regulation. For example, a court may ask whether that speech is commercial and, as such, deserving of less protection under the First Amendment.[...]

Certain categories of speech receive even less protection than commercial speech. For example, the Supreme Court has said that states may prohibit speech advocating violence if that “advocacy is directed to inciting or producing imminent lawless action and is likely to incite or produce such action.” Thus, certain types of threatening or violent speech posted on social media may not be entitled to First Amendment protection"

And also concerning internet platforms in particular:

"A court might also look to the particular nature of the medium being regulated, asking whether there are special characteristics that might justify greater regulation. The Supreme Court has said that “[e]ach medium of expression . . . must be assessed for First Amendment purposes by standards suited to it, for each may present its own problems.”"

So there's considerable complexity to the regulation of speech. It's not at all a binary issue.

[1]https://fas.org/sgp/crs/misc/R45650.pdf

product504• 6 years ago

You are absolutely wrong on both counts.

THe only real change will come from users. If Facebook users start boycotting (and to be clear no users are doing this), that is what will hurt them. So while you and I continue to be outraged, a lot of users don't care enough and just goto Facebook to see what their friends are doing and clicking on that ad. And the wheel keeps on turning around.

Employee activism won't matter much for Facebook. Unlike Google, Zuckerberg holds all the keys and he is firm/unwavering to his principles. Also, the core set of employees stick with him. Check out how Chris Cox just rejoined Facebook.

CogentHedgehog5• 6 years ago

I hear this claim a lot, but it forgets that Facebook has 1.7 BILLION daily active users and still growing. They won't miss a few users here and there: users are the product, not the customer. 100 million people could leave Facebook and it would only slightly reduce the amount of ad impressions they can sell.

On the other hand if advertisers boycott Facebook that directly hurts their bottom line.

vin0474• 6 years ago

Agree with you on the first part, but not sure on the second – if skilled employees leave (especially for other competing social media apps) Facebook will start to lag. Even with its core loyal employees Facebook can’t compete if they don’t retain skilled workers.

esoterica2• 6 years ago

If you have leverage with your employer you should use it to demand more money. Don't let other people bully you into wasting your negotiating capital on their pet causes.

Barrin923• 6 years ago

Not being bullied by anyone and I've got enough money. Which was sort of my point. Tech workers are generally speaking financially secure enough to actually use their negotiating capital for something that's important to them.

Money is the lowest form of compensation, it doesn't really matter once you have enough to put food on the table and pay rent. Self-realisation is more important and a lot of people in particular at tech companies haven't fully realised yet how much influence they could have if they're smart about it.

thundergolfer• 6 years ago

Those “pet causes” are my values and principles, and they’re worth more to me than money.

Your presuming someone would have to be bullied into action is strange, like you don’t believe many people actually think differently and care about these issues.

cultus• 6 years ago

It will be a moot point soon enough when the ad market crashes.

forgotmypw17• 6 years ago

Of course they will. All of the "boycotts" but one I've seen were until of the month, and the way it's worded, they probably won't even stop using it, just putting money into their account.

cairoshikobon• 6 years ago

Last two things I got from FB Ads:

"Smart" Wallet in Nov 2019: Never arrived. Owner now keeps posting dramatic posts without issuing anyone a refund.

Bamboo Socks: Never arrived. No email after the first order confirmation last year. No nothing.

product504• 6 years ago

Last 10 things I bought from FB ads. All arrived and our family loves it.

Anecdotes are just that - one off instances. What matters is the trend. And a lot of users buy from Facebook Ads and are happy with it. That is why Facebook revenue keeps growing at 25% yoy on a massive base of $70B.

ianlevesque• 6 years ago

HN has gone nuts. Downvoted to oblivion when quoting figures from quarterly reports.

kache_• 6 years ago

You don't vehemently boycott everything that is advertised to you? P:

Kiro• 6 years ago

Neither are you. You get brainwashed like the rest of us.

eaandkw• 6 years ago

I tried that for a while. Then I realized I spend most of my time on Twitter, FB, etc. hiding or deleting ads. So I just deleted all of my social media accounts.

mhoad2• 6 years ago

On a related note I just saw someone on Twitter mentioning this report that was just released that does a real deep dive into how the problems associated with hate speech have played out on the ground in India. [1]

It's grim reading and I think it is a huge slap in the face to that ridiculous corporate propaganda piece they released the other day saying that they don't profit from hate speech.

I'd encourage people to have a read of this, I often see these Facebook threads become extremely abstract and quickly becomes derailed about principles of free speech and the conversation just runs around in circles.

Instead this is a very concrete instance of a problem that is really happening and in concerning numbers around the world (i.e. the Rohingya genocide in Myanmar) that is directly aided by Facebook.

I want to instead have the conversation about what should we do about this particular problem and it's variations? Should brands factor these kinds of problems into their marketing strategies?

[1] https://static1.squarespace.com/static/58347d04bebafbb1e66df...

higglydiggly• 6 years ago

This is pretty explicitly the type of speech that doesn't need protection by 1A. The absolutism of it is really an ideal that practically achieved would lead to some ugliness.

But I'm wondering how this extends to banning conservatives, conspiracy theory pages, or even jokes? When is it going too far over the line, which is drawn at different points for different people/groups?

Because my fear is the government doesn't crackdown like 1984, but the public is convinced there is a much broader definition of wrongthink that people call each other on, leading to less creative expression even if it's offensive (with context) and essentially the same as CCP limitations of speech. For instance I think we're mostly over the days of racial one-liners that are just dumb and play on stereotypes, but how do we convince people still thinking those jokes are appropriate to cease using them? Education and compassion may help in some cases but not all.

shuntress5• 6 years ago

Lets start by condemning and removing organized genocide.

There is (hopefully) enough space between "actively organizing genocide" and "conservatives, conspiracy theory pages, or even jokes" to allow room for a reasonable line.

how do we convince people still thinking those jokes are appropriate to cease using them

By restricting their ability to make those jokes in a way that is clearly tied to the act of making those jokes.

mhoad2• 6 years ago

I'd kind of make the argument that to me at least, it's not really a story about "finding the right balance" between free speech absolutism and a generally pleasant society.

To me that is a somewhat interesting conversation for sure, but the point here I think is that we have a huge number of cases where real live violence and harassment is occurring directly and indirectly as a result of Facebook's choice to NOT properly moderate content that we seem to both agree is most certainly not the kind of speech worth defending.

Facebook will say that there is no way that they could possibly do a sufficient job on this and will remind you that they are "always seeking to improve" but the reality of the matter is that they have made a decision for reasons that aren't actually clear as to why they decided to dedicate this specific amount of resources on the problem.

A lot of people in society think that they should be spending more on trying to fix that problem. I happen to be one of them and I think that is the conversation I am trying to have. What is a good way for society to provide their feedback on how tech has impacted their relationships? Seems to me that very few people actually like social media but many are addicted because these Facebook spent untold amounts of time and money finding new ways to optimize for "engagement" without ever really considering all of the shitty impacts on society that might have.

kevin_thibedeau• 6 years ago

No speech on private platforms is protected. 99% of Americans just don't know how the constitution works.

ma2rten• 6 years ago

I don't know if Zuckerberg is right or not, but his retortic doesn't make it more likely that they will back.

bigdict• 6 years ago

rhetoric + retort = retortic

the_unknown• 6 years ago

And yes, he's absolutely correct. Some advertisers such as the big Canadian banks aren't even hiding it now switching from announcing a boycott to a limited-time withdrawal: "Participating brands will suspend all advertising on the platform for the month of July."

https://globalnews.ca/news/7129688/facebook-boycott-canada-b...

paulgb• 6 years ago

Nobody was ever hiding that the boycott is for July; the call for the boycott says so in the first line. Some companies decided to go for more than a month but that's their choice.

On June 17, Color Of Change along with the NAACP, ADL, Sleeping Giants, Free Press, and Common Sense Media called on Facebook’s advertisers to hit pause on ad spending for July 2020
https://colorofchange.org/stop-hate-for-profit/

wolco2• 6 years ago

Is there a big list of all of the companies taking part?

luckylion2• 6 years ago

That's actually very well played. You know that companies want to hit pause because of lower sales and less consumer confidence, so you give them an easy out that will look like a moral stance, and you wisely limit the duration so that nobody feels too committed and can return to business as usual if Covid-19-related slow downs come to an end by the end of July.

onyva• 6 years ago

It’ll continue beyond July. This quote may have changed everything. If he’s trying to become the silicon trump he is certainly getting there. Unsurprisingly both are clearly sociopaths.

roenxi• 6 years ago

It wouldn't particularly surprise me if none of the vast majority of the public, HN commenters or the companies that signed up for it had actually read the boycott documentation so that might not be as important as it seems.

doopy-loopy2• 6 years ago

FB should offer a "limited-time" discount for advertisers, subsidized by rate hike when those boycotting return.

m0zg• 6 years ago

And companies pressured by CNN to "boycott" should withdraw their ads from CNN IMO.

MrManatee• 6 years ago

In a way, they _do_ have a limited-time discount. Facebook's ad prices are set by an auction. If there are less advertisers competing during the boycott, the prices will be lower.

jhowell• 6 years ago

Why would this be a good idea? It sounds like a "punishment."

YarickR2• 6 years ago

Ad rates are down, and I know several publishers, whose ads are monetizing well, are using this opportunity to increase FB spending . Like, buying hand over fist

spangry• 6 years ago

I can see the rationale for this. Companies that publicly boycott Facebook harm Facebook's reputation (which in turn hurts Facebook's bottom line). These companies now pose a higher risk (given past behaviour) of publicly boycotting Facebook in future. So Facebook should insure against this risk by charging a 'boycott risk premium' (through higher advertising rates) for companies that are a proven public boycott risk.

pwdisswordfish22• 6 years ago

A more interesting question is what if advertisers did not come back? Does Facebook have a "Plan B" for how they would sustain themselves?

What would happen if advertisers pulled out and Facebook fell on hard times? Would someone else acquire every detail of your life that you shared with Facebook? What happens if Facebook fails? Do they send your data back to you with a note saying "Thanks for the loan"?

catacombs4• 6 years ago

What would happen if advertisers pulled out and Facebook fell on hard times?

This is very unlikely, as Facebook has more money than it knows what to do with and will easily weather this storm.

Don't get me wrong, I'm the last person to defend the company, but this is the reality: Companies who say they are boycotting Facebook are only doing it as a PR stunt. Give a few months, and you'll see their ads back on your News Feed.

throwawaysea• 6 years ago

I hope he doesn’t cave in. All the companies who signed onto the campaign to stop advertising on Facebook are essentially against the fundamental principles freedom of speech and expression. I don’t plan to buy from them any longer, because they’re normalizing censorship.

AnimalMuppet2• 6 years ago

He won't cave. If he did, he'd lose, not advertisers, but users. Some fraction of his user base cares about being able to express those opinions.

acallaghan• 6 years ago

I don’t plan to buy from them any longer, because they’re normalizing censorship.

Go make a right-wing social media site, or join one that exists now. There's people threatening civil war if Trump isn't re-elected, without being challenged or 'censored'.

Freedom of speech is from the government, private companies have freedom to choose what they allow, given they also have free speech

jb7752• 6 years ago

As long as companies like making money more than whatever cause they're claiming to care about, Zuckerberg will be proven right.

seebetter• 6 years ago

Facebook is funny because I generally agree and disagree with everyone. But people make their points so poorly, they have no sense of objectivity or analytical ability, that I’m dismayed by all sides by the lack of a principled approach.

90% of what people post about is a distraction and futile. I wish Facebook could motivate and inform people to attend local government meetings. Instead, it’s like an interactive tabloid magazine that we’re embedded in. We’re on the shelf in a Rite-Aid living in a world of ridiculousness as corporations pass by us and sell us stuff. 24 hours a day.

vorpalhex• 6 years ago

The goal isn't to confer change, it's to increase platform interactions. The best way to do that is to give you content that inspires strong emotions whether it's uplifting positivity or partisan hate.

The entire reason to have reposts is for high-interaction content to get more traction while your Aunt Sally posting food pictures gets ignored. If Aunt Sally posts something divisive that gets lots of angry emoji faces and angry comments, then that will tend to spread more on the platform.

airstrike2• 6 years ago

More people need to read The Subtle Art of Not Giving a Fuck

https://www.amazon.com/Subtle-Art-Not-Giving-Counterintuitiv...

catacombs4• 6 years ago

The book is terrible. Mark Manson is terrible. Yes, by all means people should read, but not this. There is plenty of good literature, especially fiction, that doles out the same advice but in more tactful manner, rather than the writings of a guy's lifetime of good fortune.

catacombs4• 6 years ago

I wish Facebook could motivate and inform people to attend local government meetings.

B...but that doesn't help with profits? Why bother?

op03• 6 years ago

Zuck is busy trying ensure his best employees aren't running for the hills. Too late man too late. It's already happening.

sfpoet6• 6 years ago

Yeah, if recruiters are tagging the least interested in tech in my contacts, then I know it's a ship going down. Acqui-hire is their only way to replenish the talent pool, now.

djohnston2• 6 years ago

Are you saying fb is tagging non tech people for jobs?

sfpoet6• 6 years ago

All I can do is imagine Jesse Eisenberg saying this. There are other channels you can push your spend through with decent ROI. Nobody's platform be it a personal blog or small app is without analytics anymore.

Shorting Facebook: FB 210p 7/10

xfour• 6 years ago

2:10pm 7/10/2020?

qvrjuec• 6 years ago

I think he means he's buying put options at 210 expiring on 7/10

greenshackle2• 6 years ago

Don't know if you're joking, but it's Facebook put option with strike price of $210 expiring on 7/10, in other words, betting that the stock price of FB will be less than $210 by July 10 - current price is $235, so that would be down ~10%.

anm893• 6 years ago

Is it really necessary to announce that you've taken a specific position. Should we all layout all of our related positions on every post about a company?

This doesn't belong here.

djohnston2• 6 years ago

I think it's good to disclose financial interests if you're making a point about a company, like disclosing if you are an employee.

sfpoet6• 6 years ago

I'm putting my money where my mouth is. No, not necessary; contingent. No, we shouldn't all lay out positions.

Given how much hacker news has been gamed lately, this does belong here.

tick_tock_tick• 6 years ago

Hope you sell those soon before you lose it all.

ben85ts• 6 years ago

potential ad free alternative https://userheist.com

actuator• 6 years ago

I am neither a FB user, employee or stockholder. FB has taken a lot of steps which I would not support personally; but how likely would it be for FB's bad policies to get more fanned by the old media(newspapers, news TV channels, influential blogs) because they have an axe to grind here. FB essentially disrupted the whole business model of old media and commoditizes old media entities. FB acts as a middleman, eats up revenue share and weakens the brand-user relationship, something no old media company will like.

ankit2192• 6 years ago

Facebook has a long tail of 8 million advertisers (according to their earnings report).Some of the big ones leaving would mean that the relatively smaller ones would get better returns on spend (due to fewer bidders and lower top bid) and in turn spend more.

This does help the brands get a bit of free PR at Facebook's expense, given that many of them would have been planning to reduce the spend anyway due to Covid.

darawk• 6 years ago

Yep. This is just a few big companies finding a clever way to get free marketing out of a decision to cut their marketing budgets due to the pandemic.

sharkmerry• 6 years ago

By that same token, how big are the companies at the end of the tail? If large corporations are cutting marketing budgets, small shops on tighter budgets probably are as well

linuxftw3• 6 years ago

If you have a positive ROI on marketing, and prices go down, you increase spend.

Big brands cutting spend on positive ROI is probably foolish, especially if it lets your competitors increase their ROI. For brands like pepsi that don't sell online, then it's just a cost center.

ankit2192• 6 years ago

Its the volume that makes up for that. Top 100 adverstisers on Facebook make up less than 20% of the total advertising revenue. So, a lot of other subscribers make up a major chunk, and if they increase spend even slightly (given better ROI) Facebook will have a net gain.

Not every other guy would have a tighter budget. Companies like a gaming company, a streaming platform, home delivery, edtech, telemedicine, D2C brands to name a few are the ones which have increased their budget during these times. Adding that to the fact they get better ROI on Facebook ads mean they will end up spending more (and getting more value in return).

JMTQp8lwXL3• 6 years ago

Smaller advertisers risk being viewed as less relatable and ignorant of the damage to Facebook's brand.

tridentlead• 6 years ago

No, they really don't because no-one can hold a list of millions of advertisers and who boycotted and who didn't in there head. There is no way most people will check a list before making a purchase either if that was going to be the next suggestion.

legitster3• 6 years ago

I work in marketing. Advertising markets are pretty damned efficient. If a bunch of advertisers pull out, rates come down, new advertisers come in.

There may be some affect, especially if big companies were spending inefficiently to build "awareness". But at the end of the day, the market rate for a click is the market rate. Someone will pay for it.

sfpoet6• 6 years ago

If that were true, then why aren't frequencies capped for most campaigns run on-line?

legitster3• 6 years ago

I don't think I understand this question. Why doesn't Facebook limit the number of impressions? I assume the premise is that fewer ads will be worth more?

Again, the ad market is insanely efficient and competitive. Restricted supply doesn't correlate with increased prices. If 1000 impressions is worth $20 to me, and it costs $30 on Facebook, I can take my money elsewhere. I don't even need to push a button, I have software that could automatically change my budget minute to minute.

newguy12342• 6 years ago

Yup, this is true. Someone else's banner just shows up instead of the "boycotting" brand.

CogentHedgehog5• 6 years ago

Facebook is taking a firm stance NOW. But I imagine they will end up singing a different tune if enough companies join the boycott to drop their ad revenues by 20%.

Cuts in ad buys directly hurt their profits, because ad sellers (and data collection firms) are their primary customers. Users are just a commodity that enables Facebook to sell ads and harvest data.

12xo• 6 years ago

If Facebook was a bar, would you go there? Would you hang out there? I wouldnt.

gbolcer2• 6 years ago

He should just ban them for a year.

gbolcer2• 6 years ago

He should just ban them for a year just to see what their reaction is.

anm893• 6 years ago

That would be amazing to watch.

lallysingh2• 6 years ago

Maybe let's wait to see how the anti-trust conversation goes first.

ThrustVectoring2• 6 years ago

If you're looking for anti-trust conversations, "let's all collaborate to stop doing business with Facebook" looks a lot more like an illegal combination in restraint of trade.

MangoCoffee• 6 years ago

even if big Corps stop advertising on FB. they will pay for FB's massive data.

cik• 6 years ago

Whilst companies have discussed pulling out of Facebook, for the most part they're neither discussing, nor implementing exits from Instagram.

As Instagram makes up an increasing amount of Facebook's revenue, the reality is that they're rather unconcerned. This is part of the cycle.

baxtr• 6 years ago

Of course they will. It's called performance marketing for a reason. You can track your marketing invest down to the penny. Who cares if they're evil. I believe that this is mostly a small little kindle that will burn out soon, and not a huge wildfire for Facebook.

cm20122• 6 years ago

Here's the business case why advertisers wouldn't want to enter the boycott, beyond just losing their fb sales:

1) Facebook has had a number of negative sounding news cycles in the past few years (Cambridge Analytica, etc.), and data shows that the average American hasn't changed their behavior based on them. 70% of all Americans and Canadians use Facebook or Instagram at least once a month, and 55% of all Americans and Canadians use it at least once per day. Facebook's monthly and daily user counts have only grown.

2) Facebook has done a better job than many in blocking hate speech. They can always do better, but I'd be worried about scope creep. If Facebook makes changes that the boycott organizers don't think are enough, it could make advertisers in the boycott a target if they start spending on FB again later. One key risk is if the boycott demands they start deleting Trump's posts, like Twitter did. If that happens, it would potentially put any boycotters in an unpleasant media cycle.

3) Most of the advertisers joining so far are companies that either are progressive at their roots (Patagonia, Ben & Jerry's, The North Face) or want to cut ad spend in a COVID environment anyway (Verizon, Unilever). For instance, Unilever is also pausing Twitter ads, which has nothing to do with the boycott.

4) Right now the general public does not associate most companies with FB ads. Joining the list will remind people who are passionate about this issue that their company does FB ads at all, which they don't currently think about.

So all the above combined makes me conclude that joining the boycott offers few advantages, but presents real risks.

Alex3917• 6 years ago

it would potentially put any boycotters in an unpleasant media cycle.

That's already happening anyway, look at Ryan and Saagar today: https://www.youtube.com/watch?v=EQICXcPBG8c

saos• 6 years ago

I actually hope not.

ricardo81• 6 years ago

And he has reason to be optimistic.

As per the UK's recent review into competition, 80% of online advertising spend in the UK at least, is spent with Google and Facebook [0]

So, perhaps in his mind it hurts them more than it hurts Facebook

[0] https://www.gov.uk/government/news/new-regime-needed-to-take...

jb7752• 6 years ago

If my direct competition is partaking in this boycott, I'm doubling down on my facebook ad-spend. Great opportunity to steal customers from your competition while they are worried about posturing.

willcipriano2• 6 years ago

You'd probably be able to cut your ad spend in half and get the same result if the niche is small enough. If only you are buying ad spots for Amish chocolate teapot fans all of the sudden I imagine the price goes down quickly.

zelphirkalt• 6 years ago

Such a statement shows, that he still has learned nothing, specifically not responsibility. For Zuckerberg it needs to financially hurt, in order to cause ethical decisions.

Well, such kind of statement will hopefully also prolong the boykott, because no one will want to seem like the beaten dog, beaten. ack into line. Hopefully the boykott will even increase.

A4ET8a8uTh02• 6 years ago

Maybe the ask was just too big. If someone bashed me relentlessly over media, I too would be trying to mollify the mob.. but not at any price.

devalgo2• 6 years ago

For Zuckerberg it needs to financially hurt, in order to cause ethical decisions.

Hasn't he lost ~$6B in net worth because of this?

philg_jr2• 6 years ago

So he is worth $82B now? Do you think he really loses sleep over that? He knows this is temporary and the stock will most likely bounce back.

esoterica2• 6 years ago

He did when FB's stock fell from $242 to $216 a couple days ago. Now it's back up to $234, so you do the math.

globular-toast2• 6 years ago

He hasn't really lost anything. Even if he was planning to liquidate all of his stock right now, and assuming he could sell it all at the current market rate, what do you think could really be bought for $6 billion? They are just numbers at this level. He hasn't lost anything tangible.

linuxftw3• 6 years ago

You can only hurt him if the outrage mob is large enough. Probably, it isn't, it's just a vocal minority, the rest of the world is going to continue using facebook.

someluccc2• 6 years ago

The cool thing about facebook’s highly targeted advertising is that it balances the ad market in favor of niche players vs. generalists, which also means they have a long long tail of millions of small buyers vs. a few huge ones who used to dominate traditional media.

Old marketing was carpetbombing, which meant only those with B-52 sized budgets could dominate. It was also deeply entwined with centralized high-volume distribution models, aligning the interests of big manufactures and big retailers.

Today’s marketing is precision bombing. You just need the right explosion in the right place. Likewise, internet distribution enables the economics of small manufacturers and small retailers (shopify/amz third-party).

Which is why big advertisers have done relatively poorly with internet ads. Their prior campaigns worked, not so much because they or the product were good, but because they could silence small competitors. Because retailers could only carry a limited amount of products they would favor the big mfgs who could provide bulk orders. Consumers just went for them because they had no other choice.

Today small player’s can advertise to narrow niches where rates are low. Likewise consumers can access products that better suit their specific needs/wants. What this means is that FB doesn’t really need or depend on big budget advertisers. Mark knows this.

msla2• 6 years ago

Today’s marketing is precision bombing. You just need the right explosion in the right place. Likewise, the internet enables the economies of small manufacturers and small retailers (shopify/amz third-party).

It's direct mail and it's nothing new. It was annoying decades ago, it's even more annoying now, because it's better-targeted, to the point it's effectively surveillance. Carpet-bombing advertising is brand advertising: It's somewhat annoying, but it doesn't track you.

someluccc2• 6 years ago

Direct mail is to FB ads what chariots are to a Ferrari. You can pay facebook to target any of 1.7 Billion people with 0 research on your end. You can automate a campaign for reach/effectiveness. Your budget can be whatever you want it to be. You can get instant feedback and adjust accordingly.

FB adds are expensive because people click on them. They click on them because they are useful. They are also minimally intrusive: just scroll past, no click to close, no have to watch, no site ruining banners.

I for one, actually like FB ads: they show things I may want or need, often with a discount or some other benefit.

philg_jr2• 6 years ago

Unfortunately, this model invites a lot of the "fly-by-night" type of companies offering products that may or may not have been thoroughly tested, but they know their target market may be easily manipulated through professional looking ads (eg young/naive people or people who don't know the wealth of data they give to FB to allow precision targeting).

Just one example: Molekule

asdff2• 6 years ago

Another example: Allbirds. $90 for a shoe with the build quality of something $25 from the Target store brand, but since it has hip, minimalist adverts on instagram it's seen as a great product and very popular.

dcolkitt• 6 years ago

Another reason that Internet ads don't completely supplant traditional mass marketing, is because a lot advertising is about creating a cultural consensus around a product. Beer is the classic example.

Corona wants to create the image that it's the beer for cool, relaxed dudes. We all know that there's nothing inherent to Corona that makes it the beer for cool, relaxed dudes. But through mass advertising they've created a widely shared cultural connotation for that brand. If I show up to a party with a six-pack of Corona, I'm projecting a clear message to everyone there that I'm a cool, relaxed dude. (Or at least style myself that way.) If I was going for sophisticated, adventure-lover I might show up with Dos Equis instead. And most everyone in America would understand.

For this type of marketing, hyper-targeted advertising defeats the purpose. You don't just want to reach the target customers. You want everyone in the broader culture to understand what your brand stands for. It's why mass reach advertising, like Super Bowl commercials or Times Square billboards command such hefty premiums. I watch a beer commercial at Super Bowl half time, and not only do I know that I've seen that commercial. but I know everybody else will too.

Igelau2• 6 years ago

If I show up to a party with a six-pack of Corona, I'm projecting a clear message to everyone there that I'm a cool, relaxed dude. (Or at least style myself that way.) If I was going for sophisticated, adventure-lover I might show up with Dos Equis instead. And most everyone in America would understand.

On the contrary, most are going to see you as the guy who brought bad beer because he's susceptible to aspirational advertising.

msla2• 6 years ago

If I show up to a party with a six-pack of Corona, I'm projecting a clear message to everyone there that I'm a cool, relaxed dude. (Or at least style myself that way.) If I was going for sophisticated, adventure-lover I might show up with Dos Equis instead. And most everyone in America would understand.

Beer is a bad example these days because microbrews have taken over and the consensus has become fractured: Moose Drool is big where I live, but it likely doesn't exist where you are. Buying a macro means you're out-of-touch, no matter what kinds of ads InBev is putting out for it these days.

spicyramen• 6 years ago

My take is that since many people increase their cellphone usage, some renown brands do not need advertising as they may already seen increase in online sales, hence could be a good reason to cut in ads and be politically correct

smashah• 6 years ago

I predict that Facebook will do a huge OOH campaign squeezing the other co's to come back to Facebook

ucha• 6 years ago

There is this very good article of Ben Thompson [1] predicting that Zuckerberg won't budge:

1/ large advertisers represent a small portion of FB's ad revenue

2/ if large advertisers leave and price of ads fall, other "social media ad-dependent businesses" will pick up the slack because they can measure very well their advertising return on investment thus driving the price of ads back up.

[1] https://stratechery.com/2020/apple-and-facebook/

will_pseudonym2• 6 years ago

Advertisers certainly will be back, because their public support for the cause du jour is simply a rational decision to make money/avoid losing money. When established corporations support your cause, you should be worried, because what you think you're getting isn't what you're going to get, the status quo.

matthewfelgate• 6 years ago

I'm not sure why people are hating on Facebook more than any other platform. Justified or not? Explanations pleasse.

ardy42• 6 years ago

I'm not sure why people are hating on Facebook more than any other platform. Justified or not? Explanations pleasse.

This is a big topic, so you really can't expect someone to do your homework for you if you actually want to understand.

Long story short Facebook had already shown themselves to be duplicitous and untrustworthy on the user privacy front for more than a decade, then various other dark sides of social media made themselves most evident on Facebook, and Zuckerberg has done a poor job at responding to those challenges.

ThrustVectoring2• 6 years ago

https://www.ftc.gov/tips-advice/competition-guidance/guide-a...

This advocacy for a group boycott raises anti-trust concerns, IMO. While it is not aimed at getting price concessions, it is aimed at getting other concessions in terms of the public perception of the context of the advertisements bought. This is a material contractual term, and organizing a group boycott to coerce concessions from Facebook to their business partners seems problematic on anti-trust grounds.

apexalpha• 6 years ago

Look, I'm not going to lie: I'm not the biggest fan of Facebook and the way it structured it's closed groups or how it allows posts to go 'viral'. I think there's a lot of negativity that comes from 'viral' posts.

But does anyone realistically think you could put Facebook in charge of moderating all content in the 500+ or so languages on there? With 3 billion users?

It would mean the end of all open communications platforms that we've seen since 2000s.

AngeloAnolin• 6 years ago

FB executives knows the numbers, and knows how to play them out. They also know how far reaching their platform is, and how well they are able to target the intended customers of the businesses.

They have also proven time and again that their targeted ads generate the results these businesses need. Pausing a month or two of ads does not hurt their bottom line. They could simply take a hit on those months and when these businesses go back, they could (again play the numbers) and charge more to recoup those losses.

The FB platform has grown so big that they know even if they lose one big business, the same could be replaced by 10 or 100 or even 1000 small businesses which will allow them to simply get the same amount being paid by the big companies.

gdsdfe• 6 years ago

it shows that when you have a monopoly or a strong moat, you can basically say "fuck you" to your clients in a polite way of course, oh well

b20000• 6 years ago

'soon enough' hahahhaha

RickJWagner• 6 years ago

I think it's pretty plain this has to do with politics.

It's group-bullying of Facebook. But Zuck's right-- Facebook has a huge audience, and they will keep using the platform. If some advertisers don't want to pay, their competitors will.

I hate bullying. I hope Facebook profits out of all this.

IndexPointer• 6 years ago

My conspiracy theory mind tells me this is just brands doing a show of power to end up paying less for ads. Plus scoring a PR win. The bad part is that it encourages Facebook and others to do more aggressive automatic moderation, which has low precision and deletes accounts of people merely mentioning sensitive topics.

Zuckerberg: advertisers will be back to Facebook 'soon enough'

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