June 29, 2020

Starbucks, Diageo Suspend All Social Ads As Boycott’s Influence Spirals

By Karlene Lukovitz

The #StopHateForProfit movement — originally started by civil rights groups on June 17 as an ad boycott of Facebook only, limited to the month of July — has quickly turned into a broader phenomenon.

Over the weekend, Starbucks and Diageo joined the growing list of major advertisers suspending all or part of their social media advertising in reaction to the increasing influence of the movement’s call for a crack-down on hate speech.

Both companies announced global pauses on all social media platforms for indeterminate periods of time, and both indicated that they will continue to “discuss” how to address hate speech with their “media partners.”

Starbucks appears to be biggest Facebook advertiser to date to pause ads on the platform. The company spent $94.9 million on Facebook advertising in the U.S. alone in 2019, according to estimates by analytics platform Pathmatics.

Liquor giant Diageo is estimated to have spent $22.9 million on Facebook in the U.S. last year.

Other brands announcing pauses late last week or over the weekend include Beam Suntory and American Honda (the latter’s estimated 2019 U.S. Facebook spend was $6 million). Both are suspending ads in the U.S. on Facebook and Instagram only for indefinite periods.

Birchbox on Friday said it will pause Facebook and Instagram ads in July and reallocate ad dollars to other platforms. The company, which had been “steadily reducing its reliance on the social media giant over the past two years,” according to The New York Times, is estimated to have spent only about $947,000 on Facebook in the U.S. in 2019.

The U.S. Facebook estimates for some of the other large advertisers that have implemented suspensions include $42.4 million for Unilever, $22.9 million for Verizon, and $22.1 million for Coca-Cola. The list of also includes T-Mobile, Eddie Bauer, Hershey, Levi’s, Lulumon, Magnolia Pictures, Patagonia, The North Face, REI and Upwork.

As analysts have pointed out (see today’s RTBlog), the pure financial impacts if even all of Facebook’s top advertisers pausing their advertising on Facebook and its parent company would be relatively modest, accounting for about 6% of Facebook’s ad revenues, which generated most of its $70 billion in total revenues last year.