US brands against social networks, accused of acquiescence to Facebook racism, advertising collapses

The list of companies that react to the outrage against the racist culture triggered by the killing of George Loyd is getting longer day by day. Social media, especially Facebook, have now entered the center of the viewfinder, accused of spreading, or not having, however, active blocking policies towards fake news. And it is an active response that affects the communication budgets destined by large companies to social advertising. Advertising investments are cut by large groups belonging to all product sectors: from Coca Cola to Honda, from Levi Strauss to Verizon. To date, more than a hundred large groups have decided to cut social advertising which, incidentally, makes up almost all of Facebook’s revenue.

Investments in digital ads in the United States amount to nearly one hundred billion dollars and large consumer companies have exceptional budgets of between 2 and 3 billion dollars for Coca Cola, Verizon and Unilever. Only a part of this river of money flows to Facebook, Instagram and Twitter but the cut in investments in these social networks is already producing the first effects. Last Friday, Facebook closed at $ 216, with a loss of more than 8.3% over the course of a single session. The capitalization went up by 7.2 billion. Twitter also suffered a 7.4% slump in prices, which dropped to $ 29.05 per share. And this despite the fact that the company founded by Jack Dorsey has proved more active than Facebook in blocking hate speech messages, starting with those of the current White House tenant Donald Trump. But above all Facebook, which remains at the center of criticism for the slowness and inertia with which it moves in contrasting the phenomenon of fake news and messages of violence or incitement to racial hatred. The collapse of the image suffered by the social network founded by Mark Zuckerberg could have long-term consequences, including economic ones.