Should I Stay or Should I Go? Social Media Advertising in Times of Boycott
(A2025-125392)

AUTHORS

Rémi Devaux, Institut Mines-Télécom Business School

ABSTRACT

In the summer of 2020, more than 1,000 well-known brands suspended their advertisements from Facebook and Instagram as the platforms hosted an increasing number of ’unsafe’ content for advertisers such as hate speeches and political controversies. Using data from a brand that did not boycotted Facebook Ads we document that during the boycott period, Facebook advertisements, experienced a drop in advertising effectiveness and per-impression prices compared to ad published on a similar ad network. Further analyses show that (i) ads displayed inside the news feed experienced a stronger decrease in price and effectiveness, suggesting negative spillovers from unsafe content to ads and (ii) a targeting mismatch delivered ads were to non-relevant demographic groups during the boycott. We also find that Facebook’s deletion of controversial accounts has mitigated the crisis.