Facebook v Unilever: Porter's Five Forces & CSR in… | tutor2u Business
In the News

Facebook v Unilever: Porter's Five Forces & CSR in Action

Where does the balance of bargaining power lie between a customer and a supplier?  That’s one of the key questions that underpins the announcement by multinational consumer goods giant Unilever that they may stop advertising on social media platforms such as Facebook and Google.

The Guardian reports here on the unease felt by senior management at Unilever about the damage that can be caused by Facebook and other social media platforms “if they fail to protect children, promote hate or create division in society”.

In the same way as Unilever would look to avoid using suppliers of their products which don’t meet their supply chain standards, why shouldn’t Unilever also consider the “suppliers” of a large chunk of their £6.8bn annual marketing spend? Is it consistent with Unilever's CSR strategy to use such advertising platforms?

Unilever’s thinly-veiled threat to cut digital marketing spend on these platforms is a “shot across the bows” of Facebook and the rest. It is presumably designed to encourage them to do more to monitor and police offensive and illegal use of the platforms.

Will it work? 

Whilst Unilever’s annual marketing spend makes it one of the top buyers of marketing services, it is still relatively insignificant given the overall spend on social media marketing each year. Porter's Five Forces might determine that Facebook, for example, as the supplier of digital advertising to Unilever has significantly more bargaining power.

As the chart below indicates, Facebook’s global advertising revenues have grown from $764m in 2009 to just short of $40bn in 2017. If Unilever was to cut its Facebook ad spend entirely, it would hardly register on Facebook’s advertising revenues.

However, perhaps Unilever has more bargaining power in this situation than you might expect. If a truly global multinational business that thrives on marketing spend decides that certain social media platforms are to be avoided on ethical / CSR grounds, what effect might that have on other similar businesses? Might they follow in Unilever’s footsteps?

On the other hand, can Unilever afford to miss out on the digital marketing potential of platforms like Facebook and Google. Might a decision like this provide an opportunity to its competitors such as Procter & Gamble?

Subscribe to email updates from the tutor2u Business

Join 1000s of fellow Business teachers and students all getting the tutor2u Business team's latest resources and support delivered fresh in their inbox every morning.

You can also follow @tutor2uBusiness on Twitter, subscribe to our YouTube channel, or join our popular Facebook Groups.

Job board

Teacher of Economics

The King's School, Canterbury


Teaching Vacancies


Advertise your vacancies with tutor2u

Much cheaper & more effective than TES or the Guardian. Reach the audience you really want to apply for your teaching vacancy by posting directly to our website and related social media audiences.

Find our more ›

Advertise your teaching jobs with tutor2u

A New Home for tutor2u Resources

We've just flicked the switch on moving all our digital resources to instant digital download - via our new subject stores.

For every subject you can now access each digital resource as soon as it is ordered. This will always be the latest edition of each resource too (and we'll update you automatically if there is an upgraded version to use).

Simply add the required resources to your cart, checkout using the usual options and your resources will be available to access immediately via your mytutor2u account.