Facebook has long been criticized for not doing enough to combat hate speech. Now the outrage against the world's largest social network is growing into a movement that threatens its bottom line.
That's because Facebook's latest critics are some of its biggest customers. On June 17, a group of civil rights organizations including the Anti-Defamation League, the NAACP and Color of Change called on businesses to "hit pause on hate" and not advertise on Facebook in July.
The social network makes nearly all of its money from ads, raking in more than $70 billion in revenue last year.
A growing number of major advertisers are abandoning Facebook amid criticism the social media company is letting hateful or false posts go unchecked.
Chipotle, HP, Pfizer and Puma are the latest to pull their ads from Facebook. They join a list of major brands including Adidas, Clorox, Coca-Cola, Conagra, Denny's, Ford, Starbucks, Unilever and scores of smaller businesses that have halted advertising on the platform.
A pledge by Mark Zuckerberg on Friday to label rule-breaking posts has done little to mollify advertisers.
In all, more than 100 brands have pledged to boycott the social media giant, while prominent critics including Prince Harry and Meghan Markle have also thrown their influential weight behind the boycott, according to reports.
The campaign also appears to have dented Facebook's stock. Its shares have dropped roughly 8% since the boycott started gaining steam last week, slashing $53 billion off the company's stock market value.
Although Facebook has faced plenty of boycotts in the past, the latest campaign — spearheaded by leading civil rights groups such as the NAACP and the Anti-Defamation League — could have more staying power, analysts say.
However, the majority of Facebook's revenues are derived from SMEs, not big brands. The bulk of the six million advertisers using its platform are local and online businesses, not big household brands.
The magnitude won’t really be clear until Facebook releases its Q3 results in October.