Microsoft reportedly not advertising on Facebook any longer but not for the reason you think
The outlet claims that US ad spending was suspended in May and Microsoft is now pulling out of marketing with Facebook on a global level.
Axios is quick to note that the firm has not formally joined the #StopHateForProfit movement which is encouraging companies to halt spending on Facebook and Instagram to pressure CEO Mark Zuckerberg into taking a firmer stance to filter hate speech.
Rather, Microsoft apparently has a problem with where its ads are displayed.
According to an internal Yammer post, Microsoft CMO Chris Capossela said:
Microsoft to sort things out with Facebook in private
Although the motive is somewhat similar to that of bigwigs like Coca-Cola, PepsiCo, Viber, and Starbucks, Microsoft has reportedly taken a much softer approach and is in talks with Facebook's leadership to discuss its concerns and lay down the conditions that must be met in order for it to resume advertising.
As things stand now, Microsoft expects the ad suspension to last through August.
Facebook is surely feeling the heat. The company recently announced that it will start labeling posts that go against its rules, even if they are considered newsworthy. Previously, it did not touch posts that came from public figures like President Donald Trump.
Facebook is financially too strong to be impacted by a boycott in the short term as much of its revenue is generated by small and medium-sized businesses, but its reputation can surely take a hit.
In the long run, the financial situation could get messy too and the company's shares have started tumbling already.
Some brands had already stopped advertising on Facebook because of the pandemic and the new campaign will only make the matters worse. That said, some 8 million entities advertise on Facebook, and provided that ad pricing will likely reduce because of the current situation, other firms will likely step in to fill the gap and this will probably offset the financial loss.
Some are also of the view that reduction in ad expenditure was already on the cards for many companies because of the pandemic and their support for the #StopHateForProfit campaign might very well be a PR stunt.
Microsoft, on the other hand, supposedly likes to keep things private, something which Facebook will surely appreciate at a time when others are bailing on it publicly.