It sounded too good to be true, and in this case it was. News broke this week that Facebook had heavily misreported video performance numbers for years, and may have done so knowingly. While the company claimed in 2016 that it overestimated viewing times by 60 to 80 percent, a California lawsuit filed by small social media agencies and marketing experts says the actual figure was 150 to 900 percent. The lawsuit says Facebook stalled on reporting and correcting the issue, while Facebook says there was never a cover-up. As world of the Facebook video ad lawsuit spreads, the video marketing community is left to grapple with issues of trust and transparency in one of the industry’s biggest players.
“If it is true that Facebook overstated its video ad viewing time by any substantial amount—whether it is 60 to 80 percent or as much as 900 percent—that would be extremely troubling,” says Dan Goldstein, president and owner of digital marketing agency Page 1 Solutions. “As an agency, we rely on this analytic data to determine the efficacy of the ad campaigns we run for our clients and we make recommendations for ongoing campaigns based on the assumption that the data is accurate,”
He adds: “This raises additional questions about Facebook’s transparency in light of the many issues that surfaced following the Cambridge Analytica scandal.”
Walled gardens and their lack of transparency have been a hot topic in marketing circles for the last year. For Victor Wong, CEO of platform Thunder Experience Cloud, the Facebook video ad lawsuit shows the need for independent verification.
“Counting in advertising is actually very difficult, which is why it’s the full-time focus of third-party measurement companies. That said, Facebook is understandably balancing consumer privacy by historically not allowing outside parties to come in and monitor its consumers. They will need to strike a balance to restore trust in which advertisers can get more ad transparency, publishers can secure audience data, and consumers can have privacy,” Wong says.
Even though the Facebook video ad lawsuit is getting a lot of heat right now, some see the company emerging from this scandal unscathed—not because it’s a giant, but because it actually has shown transparency.
“Without question Facebook has struggled with data breaches, brand safety violations, and ad delivery measurement (as is the case with this lawsuit). But Facebook has been transparent, mostly, about their mistakes,” says Todd Krizelman, CEO of MediaRadar. “And, to their credit, they actually talk about the missteps and their process for looking for remedies. This is not something every major media firm actually does! Facebook’s approach has been largely rewarded: Few advertisers have stopped buying on the platform and ad revenue is up.”