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Adidas tipped to halt video ad spend on FB, overall spend on social gets cut

Adidas has halted its video ad spend on Facebook, and is considering cutting spending on the platform. This is due to concerns that consumers are not regularly viewing its Facebook ads, Digiday reports, quoting sources. adidas is quoted to be “frustrated” with the limited amount of data Facebook shares with its marketing team, making it hard to verify the effectiveness of its ads.

Meanwhile, an internal review conducted by adidas uncovered that viewability and retention rates for its Facebook ads were not “high enough”. According to Digiday, there is a possibility that up to 30% of its ad spend on Facebook could be wasted and adidas is apparently unhappy with that. This poses a challenge to the brand, as it puts a heavy emphasis on video and wants to know that consumers are watching its videos instead of merely scrolling past them. adidas however, has no issue with its ad spend on Instagram.

When asked to comment on the report, a Facebook spokesperson said the company has a “great relationship” with adidas across both Facebook and Instagram. As with all its partners, Facebook’s goal is to help them be successful in earning consumers’ attention on mobile, and it continues to work with the team at adidas to “rethink video for mobile environments”, the spokesperson added.

“We know people recall mobile News Feed content within the first 0.25 seconds of exposure, which means value for advertisers is generated even before an ad is 100% in view. Our teams continue to partner with all our clients to help them grow their business and succeed on Facebook and beyond,” Facebook said.

Marketing has reached out to adidas for comment.

Adidas is not the only one to have halted digital ad spend. Procter & Gamble, for example, cut its digital ad spend by US$200 million last year to prevent ads from being served to bots as opposed to human beings, and expressed concern about the placement of ads not facilitating the equity of its brands.

It also recently made its return to YouTube, albeit in a far more selective fashion this time around, after staying away for more than a year due to concerns regarding ad placements ahead of inappropriate content. Considering this, it might create the impression that these platforms are no longer being glorified and/or trusted by advertisers, compared to when they were first launched.

According to Sid Deshpande, research director at Gartner, said social media companies such as Facebook need to offer more information in a “proactive manner” about the types of user profiles they are building and how those are being used to serve ads. This news comes amidst the recent Cambridge Analytica scandal, which caused plenty of buzz surrounding data privacy and potentially affecting approximately 65,000 users in Singapore and more than 1 million users in Indonesia. Weighing in on this, Deshpande said companies collecting data from users or consumers need to ensure they only collect data they “absolutely need” to offer a service.

“The consent the platform seeks from the consumers, for usage of the data should be clearly articulated, and the consumer should be made fully aware of the various possibilities that may arise out of the usage of this data by the company in question,” he said.

Also weighing in was Jeffrey Lim, general manager, Carbon Interactive, who claims to have seen agencies “throwing in bloated numbers from video ads” and consider them as successful and highly engaged. He added:

Brands and marketers need to be mindful that due to Facebook’s video autoplay feature, viewership does not necessarily mean engagement or views.

Lim said that the Facebook and YouTube platforms used to be effective in cutting through clutter and offering content that users want. However today, these platforms are becoming extremely noisy as well, with advertisers pushing many unwanted messages to users.

“Apart from placing the blame on these platforms not being relevant enough, marketers also should start understanding the importance of not just creating content, but content that is native and contextual which adds value to users. Only then can they leverage on the relevant platforms to garner better ROI,” Lim explained.

Read also:
The viewability issue: What marketers are really measuring
The viewability issue: Are your ads even being seen by the right audience?
Marketers to take back control of their media spend

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