Disney Slashed Ad Spending on Facebook Amid Growing Boycott--Update
By Suzanne Vranica
Walt Disney Co. has dramatically slashed its advertising
spending on Facebook Inc., according to people familiar with the
situation, the latest setback for the tech giant as it faces a
boycott from companies upset with its handling of hate speech and
Disney was Facebook's top U.S. advertiser for the first six
months of 2020, research firm Pathmatics Inc. estimates. It joins
hundreds of other companies that have paused spending, including
Unilever PLC, Starbucks Corp., Ford Motor Co., Verizon
Communication Inc. and many small marketers.
Civil-rights groups including the Anti-Defamation League and
NAACP called on advertisers to pull ad spending for July, arguing
Facebook hasn't made enough progress enforcing its policies on hate
speech and misinformation.
Some brands paused spending for longer stretches; the time frame
for Disney's pullback wasn't clear. Unlike many other companies,
Disney didn't make a public announcement that it was cutting back
on Facebook, but instead shifted advertising plans quietly.
The entertainment giant, which is concerned about Facebook's
enforcement of its policies surrounding objectionable content, has
paused advertising of its streaming-video service Disney+, the
people familiar with the situation said. Disney has promoted the
service heavily this year and it makes up a substantial portion of
the company's spending on marketing.
In the first half of this year, Disney spent an estimated $210
million on Facebook ads for Disney+ in the U.S., according to
Pathmatics. Disney was the biggest ad spender during that period.
Last year, it was the No. 2 Facebook advertiser in the U.S.
Disney also paused spending on Facebook-owned Instagram for its
sister streaming service Hulu, a person familiar with matter said.
Hulu spent $16 million on Instagram from April 15 to June 30,
Other divisions of Disney are also re-examining their
advertising on Facebook. Ads for ABC and Disney-owned cable
networks such as Freeform have all but vanished from the site.
While there are fewer shows to market during the summer, a person
familiar with the matter said, it is unlikely that ads will return
when new episodes need to be promoted, unless the social platform
polices itself better.
Disney representatives had no immediate comment.
"We know we have more work to do," Facebook said in a statement,
adding that it would work with civil-rights groups, a leading ad
trade group and other experts "to develop even more tools,
technology and policies to continue this fight."
Write to Suzanne Vranica at firstname.lastname@example.org
(END) Dow Jones Newswires
July 18, 2020 16:25 ET (20:25 GMT)
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