KSG is investigating claims for a class action lawsuit against Facebook Inc. for allegedly inflating the effectiveness of its video advertisement services to its consumers: advertisers who purchased Facebook’s video advertisements based on a marketing tool, “video metrics.” This tool was supposed to provide advertisers with valuable new marketing insight – user engagement. However, it has been alleged that Facebook has been inflating the performance of its video advertisements by 60% to 80% over the past couple years. While Facebook made millions in advertising revenues by grossly overestimating its marketing tool’s of user engagement, its customers who purchased Facebook’s video marketing services suffered unnecessary financial injuries.
Released in May 2014, Facebook’s video metric feature was an exciting news to advertisers. Not only could they narrowly tailor their desired population based on a specific set of consumer characteristics but also measure the level of engagement from their targeted consumers since the “video metric” displayed various types of consumer feedback including the number of video view, unique video views, average duration of the video view, audience retention, etc.
Knowing the power of its new feature, Facebook peddled the measurement tools by claiming that “you’ll see how people respond to your page and advertisements, so you can make informed decisions about reaching your customers.” (February 2015.) Facebook has profited handsomely from the sale of its video advertising services by packaging it with its “video metrics” tools. Just within the last three months of 2015, Facebook generated $5.8 billion dollars — $1.6 billion of which was from advertising revenue thanks to the boom in demand for video advertisements; between February 2015 and March 2016, Facebook’s active advertisers jumped from two million to three million. Many of these advertisers were small businesses who eagerly spent on Facebook video marketing based on the robust “video metric” feedback of their ads.
However, Facebook has been allegedly misleading the advertisers by inflating the average time Facebook users viewed paid video advertisements. An error in the “video metrics” tool has dramatically increased the average time users spent watching videos. Facebook video metric error has allegedly caused financially harm to advertisers who based their marketing purchases towards Facebook’s video advertisements. If the advertisers had the accurate depiction of their advertisements’ performance, they may not have forked over so much money to Facebook for its video advertising services. Facebook video metric error has allegedly benefited Facebook for over two years while advertisers – particularly small business owners – have suffered financially.
If you have purchased two or more Facebook video advertisements with ten seconds or more in length each, please contact us. You may be eligible for reparations. All initial consultations are free of charge.
Kohn, Swift & Graf is a national leader in class actions, including complex consumer litigation. With experienced attorneys and a competent support staff, our firm strives to provide the highest quality of service to our clients. We treat each case with careful attention to ensure that consumers get the justice they deserve. KSG is centrally located in Philadelphia, PA.