“Facebook is the primary means of connecting SMBs with employees, partners, and customers, yet they are failing to highlight the economic value that it brings to its members, societies, and countries,”

Facebook may be so focused on being the global connector that it is overlooking its most important public relations point. In an interview with Sir Martin Sorrell this morning at the Techonomy conference, Sorrell noted that, “Facebook is not leveraging the fact that it is a significant driver of small and mid-sized business (SMB) growth when it is defending the company in the media and to regulators and legislators,” he noted. 

“Facebook is the primary means of connecting SMBs with employees, partners, and customers, yet they are failing to highlight the economic value that it brings to its members, societies, and countries,” he added..

Facts back him up. SMBs are the key driver of economic growth. In 1979, U.S. economist, David Birch published “The Job Generation Process,” which noted, contrary to popular wisdom, that small businesses created more jobs than large companies. In 1994, Birch refined this theory and noted that the greatest job creation came from the fastest growing small businesses, which he called gazelles, and contrasted their economic contributions against large companies, dubbed elephants. 

This has not changed.  In January 2019, the U.S. Small Business Administration (SBA) declared that, “Small businesses are the lifeblood of the U.S. economy: they create two-thirds of net new jobs and drive U.S. innovation and competitiveness.” The SBA report credits small businesses with 44% of U.S. economic activity. Salesforce claims that, “SMBs are major drivers of economic growth, representing more than 90% of the business population, 60%–70% of employment, and 55% of GDP in developed economies.”

So, Sorrell makes a good point.  When Facebook’s business practices are under fire and its leadership is increasingly being called to answer to lawmakers and regulators, why aren’t they hammering home the point that they bring more value than harm because they are helping SMBs grow, helping their members find jobs with these companies, and helping communities and countries around the world proper? The economic benefits to constituents and citizens would be a strong contrast to claims that the company exploits privacy. 

Facebook certainly has plenty to trumpet. The company claims there are more than 40 million active small business pages on Facebook. It has a global road show with programs designed to help small businesses grow.  It has online SMB chat support, advertising assistance, published case studies, and a SMB Council Program. Facebook can make a straight-faced argument that the data that it collects in its business model is used for beneficial purposes. 

Facebook is not alone in its failure to use its economic benefit for public relations purposes.  “Amazon and Google have the same problem,” Sorrell notes, but adds that, “Jack Ma of Alibaba gets it.” Indeed, a recent New York Times article focuses on how Alibaba helps offset weaknesses in the Chinese economy. The article notes how Alibaba’s revenue comes from ads and commissions from goods sold on its site, and how it tunes its algorithms to help businesses sell to consumers.  Alibaba founder Jack Ma recognizes the power of his company and has gone so far as to predict that Alibaba will be the world’s fifth largest economy by 2036, supporting 10 million businesses on its platform.

Sorrell’s insights deserve further thought and consideration, by technology companies, regulators, and lawmakers. Actions taken by any of them could have unintended consequences and impact competitiveness and growth potential for the little engines of their economy.