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Sources say Adidas has paused its video ads on Facebook while it reviews their efficacy
Facebook’s measurement woes have left Adidas questioning its spending on the platform.
The marketer’s media team stopped buying video ads on Facebook and is reviewing whether to cut its spending there due to concerns that people aren’t regularly viewing its ads there, according to three separate agency executives, speaking on condition of anonymity. The executives said Adidas is frustrated about the limited amount of data Facebook shares with its marketers to verify the efficacy of their ads, even as it becomes more expensive to advertise on the site.
Up to 30 percent of what Adidas spends on Facebook could be wasted, said one of the executives, who works with Adidas’ media team, which recently completed an internal audit of its spending on the social network.
“Adidas aren’t happy with what’s happening to their money,” said the executive.
Adidas and Facebook declined to comment for this story.
The review uncovered enough waste to convince Adidas to pause its spending. Viewability and retention rates for those ads aren’t high enough, said another executive, who works with the company. While viewability isn’t always the best way to measure a campaign’s success, an advertiser like Adidas that creates a lot of video content wants to know people don’t just see a post as they scroll through their news feed, but also watch it. There were instances last year, for example, when only 22 percent of an advertiser’s videos were played in view. In the case of Adidas, it uses Moat to track how much of its own videos are played in view, which can be tricky if Adidas isn’t given access to Facebook fast enough to guarantee the platform’s reported numbers are correct.
Adidas hinted at changes last summer, sharing its dissatisfaction with industry viewability standards and the desire for better clarity about the impact of the ads it buys on Facebook. Facebook may have massive scale, but if its ads don’t lead to business results like higher sales, Adidas will turn to the channels that can.
The sportswear advertiser isn’t the only one frustrated with Facebook. In a CMO Council survey of 233 senior marketers, 62 percent said reports of false metrics from Facebook have pushed them to pull back on spending on it. Few, however, have left Facebook entirely. Executives with knowledge of Adidas’ review said the company’s relationship with Facebook has been a key point in discussions to date.
“Adidas is spending a lot less on Facebook and is looking at bigger integrations insofar as if they do continue to spend on the platform, then it could be with publishers that have influence on the platform,” said the executive who works with Adidas. “They’re thinking, ‘We’ll do something interesting beyond just running ads that people might want to skip past.’”
Interestingly, Adidas continues to work with Instagram, said one of the executives, despite its misgivings about Facebook.
If Adidas is concerned about privacy and data integrity on Facebook, the same should be true for Instagram because the platforms are part of the same ecosystem and use the same data, said Tod Loofbourrow, CEO of video company ViralGains.
“I would definitely caution those treating Facebook and Instagram differently to reconsider that notion,” he said.
The shifting rights market for sports has influenced Adidas’ view on what media it should buy. As the advertiser creates more digital content like “Tango Squad” episodes, it needs platforms that can get that content in front of fans on a regular basis. It’s why Adidas is venturing into esports, while looking to work with more influencers and sports publishers. The advertiser also is using Snapchat, becoming one of the first companies to sell products directly through an augmented reality lens in the app and is considering Snapchat for more e-commerce campaigns.
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