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Facebook Inc (NASDAQ:FB) Refunding Advertisers Over A Metric Error

Facebook Inc (NASDAQ:FB) has disclosed that refunds are being issued to advertisers after a bug was discovered which made clicks on the websites of advertisers to be overstated. This comes at a time when advertising agencies are calling for more transparency with regards to the ad performance metrics that the giant social network uses.

In an online posting Facebook argued that the discrepancy caused by the bug was minor and only occurred when users were browsing the web on mobile browsers and not while using its app or on desktop computers. Also, the bug only affected those advertisers who had specifically booked ads that brought visitors to their websites. In the period that the bug is believed to have been active about 0.04% of impressions on Facebook were affected.

Review process

Facebook’s global marketing solutions vice president, Carolyn Everson, revealed that the bug was discovered while the giant social network was carrying out a review process that was recently introduced.

The disclosure from Facebook comes amidst the ongoing ‘upfront’ season in the U.S. television industry when the country’s biggest television networks arrange parties and events which they use to showcase their programming so that they can secure ad commitments from advertisers. Thus the disclosure will assist media executives in arguing that television provides an environment that is more predictable and safer for advertisers compared to digital platforms.

Metric errors

Since September last year Facebook has on five different occasions acknowledged that the company has either understated or overstated the metrics that publishers and advertisers utilize to determine how effective their ads or content is on a digital platform. Except in this newest instance these metric errors had previously not affected billing though the social media giant has had to issue refunds in the past after bugs were reported by individual advertisers.

One of the advertisers that has been affected by the latest Facebook metric error is Unilever plc (ADR) (NYSE:UL). While appreciating the fact that Facebook had been proactive in addressing the error the company’s chief of marketing and communications, Keith Weed, called for 3rd-party verification and more transparency.

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