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As the reputations of Fox News and YouTube take a hit, advertisers vote with their feet

By Tina Irgang

Editor’s note: After this article was first published, the number of advertisers dropping from The O’Reilly Factor continued to climb. As of April 6, the total number had risen to 52.

More than 20 brands, including Mercedes-Benz, BMW and GlaxoSmithKline, have pulled ads from Fox News’ The O’Reilly Factor after a New York Times investigation uncovered multiple settlements of sexual harassment suits against host Bill O’Reilly.

This comes on the heels of a large-scale advertising boycott of YouTube over concerns that ads might be displayed alongside videos promoting hate speech.

Altogether, Fox News has paid about $13 million to settle claims against O’Reilly, The New York Times found. “Two settlements came after the network’s former chairman, Roger Ailes, was dismissed last summer in the wake of a sexual harassment scandal, when the company said it did not tolerate behavior that ‘disrespects women or contributes to an uncomfortable work environment,’” according to the investigation. (O’Reilly denies that the claims against him have merit.)

NPR’s Marketplace points out that the number of advertisers that have pulled ads is small when you consider that nearly 400 brands advertised on the show during the first quarter of this year alone. Nevertheless, the brands that have pulled the plug are some of the show’s biggest advertisers. And the fact that nearly two dozen high-profile companies felt the need to distance themselves is emblematic of the extent to which consumers’ expectations of brands have shifted. “Consumers personalize brands. They expect them to do right by society, to have a purpose,” as Marketplace puts it.

YouTube’s troubles hold lessons for Fox News

That point is further illustrated by YouTube’s recent troubles. Late last month, AT&T, Verizon, Johnson & Johnson and other major companies announced they were pulling hundreds of millions of dollars’ worth of ad spend off the video platform, according to USA Today.

In statements, the advertisers said they feared their content had appeared alongside extremist or offensive videos. (Those fears are based on an investigation by British newspaper The Times that showed major brands had unwittingly been advertising in videos that promoted terrorism or white supremacy.)

Google, which owns YouTube, immediately said it would hire more people to review ad placements, and revise policies to give advertisers more control over where their content appears in future, reports Business Insider.

That’s not all. “Over the last two weeks, Google has changed what types of videos can carry advertising, barring ads from appearing with hate speech or discriminatory content,” reports The New York Times. That still leaves the problem of reliably identifying this kind of content, which is why the company is also working on teaching its technology to understand and recognize the kind of context that marks a video as offensive.

So far, advertisers have not been sufficiently reassured to reinstate their spending.

In any case, the fact that Google, which is arguably the world’s most powerful advertising platform, feels the need to make such significant changes to the way it operates is significant.

If Fox News wants to continue attracting advertisers in the long run, its best bet is to reassure those advertisers that the channel is taking the allegations against O’Reilly seriously.

Tina Irgang is SmartCEO’s managing editor. Contact her at tina@smartceo.com.