At least one high-ranking media agency executive has had it with Facebook.
Mat Baxter -- CEO of Initiative, part of Interpublic’s Mediabrands -- put a statement on his LinkedIn account suggesting that advertisers boycott the social network until it cleans up its act.
“It’s about time we take a collective stand against the egregious behavior of Facebook,” Baxter wrote, in reaction to reports this week that the social network allowed Netflix and Spotify access to users’ private messages.
“Every time these sorts of stories surface they assure us that they are ‘trying harder’... enough is enough. I will be advising clients to stay off the platform entirely - hopefully, when they feel the pain of lost advertising dollars things might just change.”
Asked for comment, a Mediabrands spokesman replied: “We encourage independent thinking at IPG and Mat’s comments are just that — his own opinion on a major news story.”
Ironically Interpublic made a huge return on an early Facebook investment. In 2006 it invested $2.5 million in the then fledgling network — an investment that grew to nearly $400 million by 2012 when IPG cashed out.
IPG CEO Michael Roth issued a separate statement on the latest Facebook contretemps: “We take consumer privacy and protection very seriously. As an independent advisor to clients, we navigate a complex media environment and must balance audience engagement with brand safety. We look to all media platforms to be transparent about their usage of consumer data and will continue to work closely with our media partners, including Facebook, to ensure we have the highest data and privacy standards for our clients.”
IPG is showing how much it ignores the insignificance of brand spending in FB and digital altogether.
Unbelievable! It will impact FB revenues as much as
an aint crashing an elephant fingernail.
IPG paid $2.3 Billion for Acxiom.
As per Acxiom’s March 2018 10K filings,
at a $10.5 million 1.2% operating margin,
it will take IPG 22 years to recover its
Initiative will be better off thinking
about the 95% media spending of their clients,
allocated to legacy media, than wasting so much
time complaining about FB and G “broken
promisses”, who don’t give a damn to what
media agencies buy from them. Almost 90%
of digital sales come from D2C, small business
and individual advertisers, not from IPG, WPP,
OMC, Publicis, Dentsu and Havas. Do the math.
It is the economy, stupid.
Baxter is just making a principled stand. Will it harm FB’s bottom line? Of course not. But there’s more to business than P/L statements. In the long run, the voices, and dollars, against FB will continue to mount, and the bottom line will be hit.