Facebook faces class action suit over inflated video metrics

Dive Brief:

Legal fallout from Facebook’s video ad metrics problem has arrived: Three marketers are now bringing a class action suit over the social media giant's admission it inflated video metrics, MediaPost reports.
Filed late last week in California, plaintiffs Tom Letizia, Mark Fierro and Greg Agustin allege in their complaint that Facebook "induced" advertisers to buy more expensive video ads by suggesting consumers were engaging with the spots far more than was actually the case, according to MediaPost.
The legal action comes in the wake of revelations that Facebook inflated the viewing time of video ads from 60% to 80% since 2014.

Dive Insight:

After Facebook told advertisers it had been overlooking video views of less than three seconds in its measurement of time spent for the past two years, several agencies began investigating further, according to a report in The Wall Street Journal. Publicis Media found that the average time spent watching videos was overestimated by between 60% and 80%, suggesting a number of marketers were making decisions about where to invest their video budgets based on faulty data.

Although the lawsuit only includes three marketers right now, the door has been left open for more to join in on the class action suit, which would create a lot of bad publicity and a scramble for reputation management for Facebook (not to mention the possibility of damages to pay out). So far, Facebook has stayed quiet on the issue, saying only that the inflated metrics did not cause billing issues.

When news of the scandal first broke, the Association of National Advertisers (ANA) called for an audit of Facebook’s video ad metrics. ANA president and CEO Bob Liodice said an audit and accreditation by the Media Ratings Council are imperative for Facebook to achieve the measurement transparency that marketers require and expect. Unlike other platforms, Facebook has so far avoided accreditation since its ad business grew so quickly, something that has not been helped by a lack of standardization for social ad metrics.

Regardless of the lawsuit's outcome, the controversy highlights the difficulties in accurately measuring data in a fragmented media landscape and also communicating that data with transparency.