- Facebook’s business is nearly 100% driven by advertising. And even with all the negativity swirling around the company, advertisers say they have no plans to pull budgets.
- That’s because advertisers essentially have no alternative. Facebook is unparalleled in terms of scale and its ability to deliver targeted ads using data.
- That dynamic is in stark contrast to Google’s YouTube, where some advertisers have stayed away ever since some ads ended up next to hate videos on YouTube.
- While marketers say they have other places to advertise next to video besides on YouTube, cutting Facebook ads would directly hurt their business.
When the Times of London published a story about big marketers’ ads appearing next to extremist content on YouTube earlier this year, more than 250 brands pulled their spend from the Google video hub. Many industry executives jumped on the opportunity to admonish Google for not doing enough to keep brands safe, with brands such as Walmart and JPMorgan Chase publicly airing out their concerns.
Over six months later, it is Facebook, the other half of the advertising duopoly, that is embroiled in a public maelstrom. Just a week after Facebook’s top lawyer testified before the Congress on Russia-linked ads, Facebook informed advertisers that the company had discovered two new measurement errors — the 11th and 12th such errors that the company has disclosed in a little over a year.
Yet, even with all the negativity swirling around Facebook (including articles questioning whether its actually good for society or not), its business remains unscathed. Not only did the company beat Wall Street’s expectations for the third quarter and report its best earnings to date, it also continues to attract advertisers, and most seem unperturbed. And even the ones that are concerned are not changing where they allocate their ad budgets.
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