a Thread with Some thoughts on FB "boycott" by mega brands >>>

TL:DR: https://twitter.com/OV_LegacyVP/status/1276906427366412289?s=20

Brand ads ("Drink Cocal Cola, It's the Real Thing") always had a lumpy relationship with Core FB.

After all, the $ to fuel projections that 23' TV ad spend will still be over 25% of the global ad market have to stand on something - and they're standing on big brands
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Mega brands have some very good reasons to pivot against $FB. first and foremost - their competitive advantage using FB and IG is massively narrowed compared to the Legacy TV ads biz.

FB might be the greatest "Level the Playing Field" of Mega brands Vs. SME ever created.
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Sheryl Sandberg is addressing SME empowerment constantly: "Our service makes it possible for every business to access the same tools as the largest brands" (Q32018 call)

In FB, Mega brands almost do not enjoy real pricing leverage, they're exposed>>>

...and their massive production & endorsements budget gives them only a narrow advantage.

SMEs are leveraging FB's world-class ads format and tools innovation.

Unilever halted spend in July?
You can probably find 15 different Micro Mayo brands selling directly on FB and IG>>

And FB do not stop there, famously introducing its integrated E commerce platform FB Shops in 2020. Goldman Sachs sees the service getting to over $100B GMV by 2023, most of it from SMEs.

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Having said that, Sandberg does put a lot of efforts into bringing Brand advertisement to invest more in FB Networks. It seems like it's a personal challenge for her, repeatedly talked about with analysts, media and industry members:
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"Our data says that if you do TV+Facebook, you enhance your reach by 17, 18 percent and more than double that for millennials, which is a hard group to reach right now on TV"
(a 2017 Bloomberg interview)

So FB does need Big brands to stimulate growth. But it doesn't NEED them>>

Efforts among Big brands is focused into Direct Messaging integration (like a successful campaign in Japan where Honda sold 100 cars a day through Messenger), and the somewhat failed FB Watch and IGTV Long-Form content push.

This new @stratechery analysis is on the spot and Golden:

"Relatedly, the direct response opportunity is so large because Facebook has created the conditions for new direct response-based companies to be created"
Cc. @benthompson https://stratechery.com/2020/apple-and-facebook/?utm_source=Memberful&utm_campaign=85f030bb05-daily_update_2020_06_29&utm_medium=email&utm_term=0_d4c7fece27-85f030bb05-111006145

Cc. @soonervaluecap @JerryCap