Since the spring, the social media company formerly known as Facebook has been assessing where it advertises and how much it spends doing so, taking arguments from agencies that want to help it manage its huge marketing budget.
The so-called media review — the first for Meta, the new name for the parent company of Facebook and its sister apps Instagram, WhatsApp and Messenger — ended on Tuesday when it picked agency Spark Foundry as its new global planning and purchasing partner.
Spark Foundry, owned by French advertising giant Publicis, will handle “strategic leadership, media innovation, planning and investment, cross-channel approaches, tools, technology and operations “said Lisa Stratton, spokeswoman for Meta, in an email. The global agency, which replaces the social network’s former media partners, Dentsu and Mindshare, also recently won contracts with beauty brand Clarins and automaker Toyota. The decision does not affect Meta’s creative strategy.
Meta made the switch after a seven-month review, during which it faced intense public scrutiny following damaging revelations about its business practices and the effects of its apps on teens, fueled by the whistleblower Frances Haugen, a former employee.
Even as the social platform grappled with the scandals, major advertising companies pitched for what would be a particularly high-profile client. Meta spent nearly $3.6 billion on marketing and sales last quarter, up 32% from a year earlier. Gaining the Meta account gave agencies access to the social media giant’s deep pockets and considerable influence.
The situation underscores Madison Avenue’s co-dependency on Meta. Most of the advertising industry is either already in business with the company or hopes to be, usually by placing advertisements on its platforms or by placing advertisements for Facebook, Instagram, WhatsApp and Messenger on other platforms.
Last month, Meta said it earned 97% of its revenue, or $28.3 billion, from selling advertising space in the last quarter. Advertising Week, a recent industry conference, featured featured panels by Meta, which has also sponsored events for the Association of National Advertisers and the American Association of Advertising Agencies. Meta employees serve on the boards of industry trade groups such as the Interactive Advertising Bureau and the American Advertising Federation.
The ad industry spawned Facebook and is “the hidden hand behind all of Facebook’s dreadful headlines,” but has remained largely circumspect about the company, wrote company veteran Bob Hoffman in his Ad Contrarian newsletter last month. “While the rest of the world is sickened by Facebook’s activities, the industry with the deepest connection to it, and the most to lose, is our own. And yet… crickets.
Bob Liodice, ANA’s chief executive, said in an email that the group takes brand safety issues seriously, but its members “are responsible for making their own investment choices to determine the suitability of a specific media platform or vehicle for building their brand.”
The IAB did not respond to a request for comment. The American Association of Advertising Agencies said it would continue to address issues related to ensuring a safe and transparent ecosystem.
But one company, outdoor clothing and gear seller Patagonia, said it stopped all paid advertising on Meta’s platforms last year due to brand safety concerns.
“Facebook’s internal documents released over the past few weeks have made it abundantly clear that they know the irreparable damage their lack of accountability is causing to their three billion users and the corrosive effects this is having on society itself.” , said Ryan Gellert, general manager of Patagonia. said in an emailed statement.
Meta, like many other companies, works with both creative agencies, which help design and produce marketing campaigns, and media agencies, which help determine where ads go. It maintains relationships with virtually the entire modern advertising industry, made up primarily of six major holding companies – Dentsu, Havas, IPG, Omnicom, Publicis and WPP – which control a constellation of subsidiary agencies. Meta also works with consultancies like Accenture, which have acquired agencies in recent years, and a few independent boutiques.
On the creative side, Droga5, owned by Accenture, helps Meta create corporate messaging and create corporate videos timed for the Olympics. BBDO, owned by Omnicom, does marketing campaigns for WhatsApp and the main Facebook app. Johannes Leonardo, who is part-owned by WPP, took over Ogilvy’s Instagram work this spring. Meta also has an in-house team, known as Creative X, working on marketing.
Wieden+Kennedy, an independent agency based in Portland, was responsible for the entire Facebook brand and created the company’s ad for the 2020 Super Bowl. But during a large-scale boycott of the social network the last year by advertisers unhappy with the platform’s hate speech policy, Colleen DeCourcy, creative director of Wieden + Kennedy, said the situation “has created many difficult conversations within the agency.” .
When asked in Time magazine if she expected Facebook to be a customer in 2021, she replied, “If I was a betting person? I wouldn’t put too many dollars into this space.
A spokeswoman for Wieden+Kennedy said the agency no longer works with Meta and they parted ways in the first half.
Since it began investing seriously in marketing in 2014, Facebook had entrusted its media budget to Dentsu and Mindshare, an agency owned by WPP. It began its media review in April, working with management consulting firm ID Comms, a matchmaker of sorts that also oversaw reviews this year for Hershey’s and T-Mobile.
Meta asked participating agencies to agree to restrictive contract terms before allowing them to proceed with various budget planning and procurement exercises, said two people with knowledge of the negotiations who were not authorized to speak publicly. Meta declined to comment on the process.
As Meta’s troubles mounted, employees at some agencies protested the idea of having the company as a client, the people said.
In July, Mindshare pulled out of the social network’s media review, which was held virtually. Meta dropped Havas, another advertising giant, from the race last month. Publicis’ Spark Foundry won out over its latest rival, Dentsu.
“We have a long history of leading brands in transformation and we look forward to working with Meta on the next evolution of their business,” said Sarah Kramer, managing director of Spark Foundry US, in a statement.
“Meta remains a transformative global partner for Dentsu International,” the company said in a statement. “Our drive to co-create integrated marketing solutions for our many joint customers will continue unabated. We look forward to continuing our pioneering partnership in 2022 and beyond. »
Mindshare and Havas did not immediately comment. GroupM, which runs Mindshare, declined to comment.
Meta has also been plagued with complaints about abuse from the advertising industry. Ms. Haugen, the whistleblower, testified that the company misled advertisers about its efforts to harden its platform against harmful content and attempted to block efforts to mine data on political ads.
The real test of Madison Avenue’s patience with Meta will come down to how popular the company is with users, eMarketer analyst Blake Droesch said in a recent podcast from the research firm.
“Users leaving Facebook are the only thing that would cause advertisers to leave Facebook,” he said.