Business

Facebook Forced To Apologize After Video Errors Mislead Advertisers

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Eric Lieberman Deputy Editor

Facebook admitted to inflating the average viewing time for video advertisements weeks ago, and now marketers are mad at the social media conglomerate.

Facebook explained that its metric that gauges the average time users spent watching videos was skewed because it would count any viewing over three seconds. This artificially inflates the number because, as many users know, many videos will automatically play when scrolled over.

The discrepancy could have unfairly charged advertisers more since many of the contracts are based off of view count or view duration. David Fischer, vice president of business and marketing partnerships for Facebook, announced in a blog post that the error “has not and will not … have an impact on billing or how media mix models value their Facebook video investments.”

Businesses were likely provided with false data that could have affected decision-making processes.

Publicis Media, an ad buying agency, was notified by Facebook that the mechanism overestimated the average time spent watching videos by anywhere from 60 percent to 80 percent, according to The Wall Street Journal. Publicis was responsible for purchasing approximately $77 billion in ads for several of its clients across the globe, the WSJ reports.

Facebook first revealed the issue in a post on its “Advertiser Help Center” several weeks ago.

“About a month ago, we found an error in the way we calculate one of the video metrics on our dashboard – average duration of video viewed. The metric should have reflected the total time spent watching a video divided by the total number of people who played the video,” Fischer wrote. “But it didn’t – it reflected the total time spent watching a video divided by only the number of ‘views’ of a video.”

Facebook’s annual revenue in 2012 totaled $5.09 billion and $7.8 billion in 2013. Eighty-two percent of the revenue from the first quarter of 2012 came from advertising, according to Business Management Degrees. In other words, Facebook’s behemoth status is fueled by its advertising capabilities and its large user base.

This miscalculation, whether purposeful or not, could hurt Facebook’s bottom-line if businesses and marketers decide to advertise elsewhere out of fear of continuously being duped.

“While this is only one of the many metrics marketers look at, we take any mistake seriously,” Fischer explained.

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