Never underestimate the power of the press. The last two weeks have been straight from hell for Facebook’s crisis communication team – with billions of dollars wiped from the company’s market value following the Cambridge Analytica crisis. Nevertheless, they are doing a great job of handling this. Usually, a confidence crisis like this would have already led to the CEO “choosing to step down and spend more time with his family”, but since Facebook founder and CEO Mark Zuckerberg holds around 60% of the voting rights, that’s not going to happen unless he is convinced that his continued helmsmanship is causing long-term damage to the Facebook brand.
And Zuckerberg is safe unless further “shocking revelations” emerge, or Facebook’s stock starts hemorrhaging value. His PR and crisis/reputation management teams know that – and are therefore handling the crisis with a light touch: there’s really no need to get heavy-handed.
The Cambridge Analytica crisis has all the elements of a great story. There’s the shock revelation: claimed behind-the-scenes political manipulation. There’s drama: that millions – perhaps billions – of Facebook users’ data has been accessed for perhaps less than honorable reasons, and there’s the slow, dawning realization that we’ve all been gamed.
Giving it all away
We’re somewhat surprised that the Facebook backlash has taken so long. Over the last decade, many of its users have voluntarily (and sometimes unwittingly) provided more information, on the drip, than they’d ever feel comfortable providing to a stranger – unless they’ve actively locked down their Facebook settings. That innocent quiz on your “adventurer name”, where you combine your mother’s maiden name with the name of your first pet? Your favorite holiday location? The best 80s song? “Share if you remember what a rotary dial phone sounded like …”; post your first phone number … Yep. All that. If you’re patient, you have more than you need to steal someone’s identity.
Then there was the convenience – of being able to use your Facebook account to login to third-party services. No more needing to go through the “laborious” process of setting up accounts and passwords, just share liberal amounts of data as requested by third-party apps. In our race to the free stuff, we often forget that someone, somewhere, has placed a monetary value on the data we are prepared to provide just for the sake of saving a few seconds.
Facebook is doing a good job in handling the media crisis
Actually, Facebook is doing a good job in handling the media crisis that some commentators claim is “engulfing” the company. It isn’t. Media coverage has already shifted from the revelatory shock horror stage, via the “Zuckerberg’s net drops by billions overnight” (it’s academic – how many yachts do you need?), and we’ve now reached the analysis as we sift through the wreckage: How did this happen? Should I delete my Facebook account? (Good luck with that!) We’re heading into the stage now where so-called third-party experts will answer every question you can imagine related to Facebook: “how to download all your data from Facebook”, “how to … make sure you’re not sharing unnecessary data with apps / delete app access / lock down your profile”, “how to prevent Facebook from ever selling you out …”. Then we’ll see a slew of stories saying “I deleted my Facebook account and never looked back …” and then, just as we’re all forgetting about it and getting back to posting pictures of our pets, we’ll move to reportage of class action lawsuits being filed in the courts.
Putting Facebook’s crisis into perspective
Breathless reportage has claimed that the crisis has caused Facebook stock to “freefall”. In fact, it’s back to April 2017 levels. The stock has faltered before – notably, immediately after the IPO back in 2012. Since then, the trend has been largely upwards, upwards and upwards. Any market expert providing knee-jerk advice to “sell your Facebook stock” is thinking short-term. There are plenty of other popular stocks trading today below their April 2017 levels.
Right now, Facebook’s PR team are following the strategy of riding out the storm. Something else will happen – sooner or later – that will knock the Facebook story out of the headlines. It’s already dipping – nowhere to be seen on the front page of today’s New York Times, and no mention of Facebook in the BBC’s 10 most read news stories.
The backlash that was bound to happen
In fact, Facebook’s PR team will be less concerned about the swath of “shock horror” stories that are starting to appear by authors who appear to have previous been ignorant as to how much personal data they’ve shared with Facebook. This is the backlash that was bound to happen, sooner or later – and it’s inconceivable that Facebook’s professional communicators won’t have been prepared for this. As it weathers the storm, Facebook will be keen to see coverage which lays the blame with third parties who have abused their position of trust and gobbled up more data than they could possibly justify … moving the finger-pointing away from Facebook itself.
The company will be most concerned with metrics, because that’s where the next part of the story will unfold. Facebook’s ability to earn revenue is based on the number of people who use its platform, and their dwell time – as well as advertising click-thrus of course. We expect the number of unique visitors to Facebook to increase this quarter – for two reasons: not only the people who are logging in to try and delete their account, to download a full set of the data they’ve “given” to Facebook or to lock down their privacy. But also the people who won’t care about that, but are prompted to login to Facebook after a break … and perhaps getting hooked once again.
We’re a month away from Facebook’s first quarter results, but according to statistics from digital marketing agency Zephoria, there are over 2.13 billion monthly active Facebook users for Q4 2017, which is a 14 percent increase year over year. As noted above, expect this to increase in Q1 2018. Another really telling statistic is the also 14 percent year-on-year increase in Facebook daily users … more than 1.4Bn. Bear this in mind the next time someone authoritatively proclaims that Facebook’s dead – probably because their friends aren’t (admitting to) using it…
What *is* keeping Facebook’s PR team awake at night
What Facebook’s PRs are really worried about is a downward trend in daily visitors … but that’s not going to happen yet. There’s actually a current surge in users – all those people logging on who haven’t been around for a while. Therefore it’s going to be the end of July when it’s really going to be possible to tell if there’s any long-term damage to Facebook: This is when the company is due to publish its second quarter earnings.
Until then, the Facebook PR strategy is to ride the storm, be sure to hawkishly rebut any claims that stretch the truth too far – and keep deflecting the blame on to third parties. All this while waiting for the next big story to break. And all the time, probably wanting to tell the world’s media: “Well, you’re the ones who gave up this information in the first place!”