LinkedIn has been hit with a proposed class action in the wake of a blog post in which the professional networking platform admitted it addressed two “measurement issues” that caused some online ad campaign metrics to be overreported.
The 12-page lawsuit says ad buyers such as the plaintiffs were consequently “overcharged and overpaid” for advertisements on LinkedIn’s platform given they relied on the company’s assurances that its metrics, specifically for impressions and video views for a type of online advertising called sponsored content, were “accurate and reliable.”
As the suit tells it, the breadth of the consequences of LinkedIn’s ad campaign metrics inaccuracies is yet unknown, and ad buyers are without any evidence that this problem, and potentially others, has been fixed.
“While LinkedIn has tried to downplay the impact of this failure to monitor and control its own advertising platform, the total extent of the damage to their customers is not yet known,” the complaint reads. “Nor is there conclusive proof that these problems have been fully rectified and that other unknown ‘measurement issues’ may not lurk in its vast system.”
Aside from simply overpaying for incorrectly measured ads, proposed class members also shelled out money for “an unknown number of ineffective ads,” the complaint alleges.
Per the case, LinkedIn posted on November 12, 2020 a blog post in which the company said its engineering team discovered and quickly fixed back in August two measurement issues that may have caused some metrics for sponsored content campaigns—online ads that resemble a publication’s editorial content but are paid for by an advertiser with the intention of promotion—to be overreported. LinkedIn revealed the metrics “issues” impacted “hundreds of thousands” of advertisers and went undetected over at least the last two years, the lawsuit relays.
Ad buyers are drawn to LinkedIn in part because of the company’s more than 260 million active monthly users, who create “a robust and active audience” that’s attractive to all manner of advertisers, the suit says. As with Facebook and Google, advertisers pay LinkedIn “extortionary amounts” to reach target audiences on the platform, and the buyers rely on the defendant to be an honest broker in how it tracks, monitors and charges for ads, the lawsuit states.
“While advertisers have certain tools available to them to track their own ads, certain information can only be known and conveyed by LinkedIn itself, leaving advertisers in a vulnerable position to act in blind reliance on LinkedIn’s own metrics and reporting,” the complaint says.
The case chides LinkedIn for waiting at least two months to fix the ad-metrics issues and provide notice to customers. In the interim, millions of online advertisers bought “untold amounts of advertising” on the platform “with absolutely no notice of ongoing or previous failures” with regard to tracking and monitoring ad performance, the complaint contends.
Had proposed class members known LinkedIn’s ad metrics were unreliable, they would have chosen to take their ad dollars to other competitive platforms, according to the suit.
“LinkedIn intended that Plaintiffs and Class members rely on its metrics,” the lawsuit says. “LinkedIn promoted the metrics to users to demonstrate the supposed effectiveness of paid advertisements on its platform, knew that its metrics were relevant and material to advertisers, and concealed the fact that its recklessness had caused the metrics to be inflated because it knew that would hurt user trust and result in advertisers purchasing fewer ads.”
The lawsuit, which alleges violations of California’s Unfair Competition Law, looks to represent all persons and entities who, within the relevant statute of limitations period, paid to place ads with LinkedIn.
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