Facebook has overdrawn from its "brand bank"

Steve Jobs had a theory of “the brand bank.” Ken Segall explains the idea in his book Insanely Simple: The Obsession That Drives Apple’s Success: 

“(Steve Jobs) believed that a company’s brand works like a bank account.

When the company does good things, such as launch a hit product or a great campaign, it makes deposits in the brand bank. When a company experiences setbacks, like an embarrassing mouse or an overpriced computer, it’s making a withdrawal.

When there’s a healthy balance in the brand bank, customers are more willing to ride out the tough times. With a low balance, they might be more tempted to cut and run.”

This week, with Facebook’s six hour outage and Frances Haugen’s explosive whitstleblower testimony, Facebook’s brand balance took a big blow.

Ever since the Cambridge Analytica scandal, Facebook has been making major withdrawals from its brand bank. And it hasn’t made many deposits that have made a meaningful impact on public perception. Facebook’s actions that once helped their brand balance have backfired (e.g., its “meaningful social interactions” newsfeed approach can cause more harm than good and Facebook disbanded the Civic Integrity team after the 2020 elections and before the Jan 6 riot).

To make matters worse for Facebook, Mark Zuckerberg’s lengthy statement in response to Haugen’s testimony was largely dismissive. The intention may have been to regain trust, but It’s hard to believe him when he says that her testimony paints a “false picture of the company” and that the information is “misrepresentative” when there are thousands of pages of evidence. One of the current top comments on Zuckerberg’s post sums up the sentiment that many must’ve felt when reading it: “CAN WE GET THIS POST FACT CHECKED PLEASE??”

Facebook’s reputation seems permanently damaged. People are tired of giving Facebook second chances. And that’s dangerous territory for a brand.