As we’re all probably aware, this past Monday, Facebook, Instagram, and TikTok were down and everyone freaked out. However, this did not only affect us Gen Z-ers. Advertisers are concerned about their business for the holiday season.
David Herrmann, a freelance media buyer, said that everyone he worked with heavily relied on the platforms. He manages about $80 million to $100 million on ad spending for his clients.
One company that advertises exclusively on Facebook watched its revenue plunge 70 percent during the outage. For another company that spends $40,000 a day on ads, sales went down 30 percent.
It’s important to note that advertisers contribute to 98 percent of Facebook’s revenue. This makes sense since most Gen Z-ers and Millenials stopped using the platform which leaves Facebook’s users to mostly be Gen-X or Baby Boomers. However, Facebook might be losing some of that business now due to its frequent shutdowns.
Although Facebook said on Twitter, “advertisers were not and will not be billed for ads during the outage,” advertisers are starting to realize how risky it is to depend on Facebook to be there for their business long term. This may have to do with the fact that the platform went dark at a very crucial period for advertisers, which is the holiday season.
The outage led to more concerns about Facebook. Omnicom Media Group released that Facebook misled its oversight board by claiming that its XCheck program, which exempted at least 5.8 million high-profile users from normal enforcement rules, was used only sparingly and that data from the system could not be tracked.
On top of not being reliable, now advertisers are questioning the accuracy and sincerity of Facebook’s responses to these inquires. What came to light was the fact that there is no public accountability or transparency when it comes to the company and its integrity.
All in all, regardless of the functional and moral ethics that Facebook violated this week, it is unfortunately still safe to say that they will remain as the top dog when it comes to advertisements due to its enormous size, reach, and history.