15 April 2014

There’s no such thing as a free lunch – not even digitally

There has been a lot of controversy lately around the fact that brands are seeing less and less engagement on Facebook, leaving them no other option than to pay for promotion to get back to the top, as Facebook is constantly tweaking the algorithms behind the News Feed. It started this time around with a so-called ‘breakup letter’ from Eat24 a company lamenting how much Facebook has changed for the worse and announcing they will be closing down their Facebook page. Many others have since then expressed opinions on the matter, from calling Facebook’s behavior outright ‘extortion’ to more balanced articles explaining that there’s a limit to the amount of information people can consume, so with more and more content, individual pages will appear less often in the news feed.

Someone even made an YouTube video about this: “The Problem With Facebook”

Average Organic Reach of content publishers on brand Facebook pagesFacebook did indeed made several changes over the past months to news feed ranking factors to boost the relative importance of updates from friends and reduce spam; those might have affected the reach of pages. But when I hear these kind of complaints from companies, I can’t help remember a presentation I attended almost four years ago. It was naturally about Facebook and how to build a success story there. The thing that stuck with me over the years is that one presenter insisted their campaign got such and such results ‘for free’. Which was obviously misleading; the strategy didn’t come from thin air, there were people planning it, others who posted on Facebook and engaged with the audience. At the very least you could count the hours put into the project and make an estimate based on the salaries of the people involved. Probably a professional defect, since I work in finance, but you can always assign some cost estimate in parallel to the revenues from a particular project.

This flawed way of thinking is now causing the outrage against Facebook. Most brands saw Facebook as a free way to reach people, to promote and provide customer support. Some even went as far as to give up their other channels, blogs and company pages, and exist exclusively on Facebook. But Facebook is itself a business, not a charity organization, so at some point they need to get income – especially now as a publicly traded company. It’s safe to say that brands will need to pay for Facebook’s services – just like they would pay for email marketing campaigns.

For me the situation is pretty similar to search ads and Google; in search results you can rank high through relevant content, organically, or buy an ad – and be featured even higher than the top ranking result. Google is constantly changing the search algorithm too; sometimes old ruled get turned on the head and sites get penalized for what was previously accepted behavior – see the recent problems with guest blogging. Likewise content from publishers on Facebook is submitted to their internal decisions about what the News Feed should contain, so it will become increasingly hard to build organic reach; instead ads will continue to offer safe, albeit paid, reach. Both Facebook and Google can afford this ad-driven model because of their effective monopolies on social (on the desktop at least) and search respectively. It will be very interesting to watch how the landscape will change once mobile Internet use takes over desktop browsing and the paths to discovery diversify, possibly circumventing both traditional search and the traditional social graph. Apple has one solution with iBeacon inside iOS; Asian social messaging apps are targeting this space as well, despite Facebook’s efforts to control mobile messaging; and the future is sure to bring more competitors to the table.

Post a Comment