Face it — Facebook has led marketers down the primrose path. They taught us about and addicted us to free earned media. They encouraged us to spend money to attract and engage millions of followers. They ran us through the “like” gates. And now they’ve tightly restricted access to the audiences we created and extorted us by creating a pay-for-play platform. In short, marketers now have to pay to reach the audiences we attracted to the Facebook in the first place.
By steadily manipulating the Edgerank algorithm, Facebook has systematically reduced access to the fanbases we built. In 2012, they restricted organic brand reach to about 16 percent. In late 2013, they restricted it even further. Now, a recent Ogilvy study shows that as little as 2% of a brand’s fans actually see brand posts — and many marketers assume that brand reach will soon be zero. Valleywag summarized the issue well:
A source professionally familiar with Facebook’s marketing strategy, who requested to remain anonymous, tells Valleywag that the social network is “in the process of” slashing “organic page reach” down to 1 or 2 percent. This would affect “all brands”—meaning an advertising giant like Nike, which has spent a great deal of internet effort collecting over 16 million Facebook likes, would only be able to affect of around a 160,000 of them when it pushes out a post. Companies like Gawker, too, rely on gratis Facebook propagation for a huge amount of their audience. Companies on Facebook will have to pay or be pointless.
Savvy marketers are now asking tougher questions about metrics and ROI. If we have to pay for what we used to get for free, what is the business impact of Facebook advertising, and how does it move product or build brand loyalty? Engagement, which has been the ill-defined but widely accepted payoff for several years, is falling out of favor as a useful metric. But there are few hard numbers to justify sustained investment in Facebook advertising. Facebook would ask marketers to trust its own self-serving “research,” but that does little to convince skeptical CFOs.
Despite this clear bait-and-switch, the response from brand marketers has largely been muted. Few are willing to buck the 800-pound gorilla in our midst. Many are reluctant to tell their bosses that this once high-flying platform — filled with the promise of free viral reach and added engagement value — has radically changed, and that new and bigger budgets are required to make it useful.
Marketers who choose to continue playing Facebook’s game have to find a way to adapt. One approach is by betting on the power of creativity. They argue that if a brand can deliver really cool content to the two percent they actually reach, those fans will spread the word among themselves. These marketers are doubling down on video, GIFs, and games. They’re working overtime to devise memes with wings.
A second approach is simply playing ball with Facebook. These brands are investing ad dollars for both desktop and mobile units. They’re using all 200+ targeting channels, comparing brand databases with Facebook’s, running contests and promotions, and experimenting with different units and page placements, all in an attempt to regain access to the fans they already earned and expand their reach among Facebook’s billion+ users. There are many cases of successful lead generation and awareness campaigns, though the ROI varies widely.
A third segment is abandoning Facebook in favor of other social networks. Twitter, Pinterest, Tumblr, and others have increased sales efforts, created new packages, and expressed a willingness to customize units and experiment cooperatively with brands in order to capture dollars that might otherwise have gone to Zuckerberg & Company.
Facebook’s shift to a pay-for-play platform won’t scare every marketer away, but it will change how brands view social media marketing. Now that the stakes have changed and the ante is higher, brands are asking tougher measurement questions and demanding a greater connection between social media activity and business results. They’re also reconsidering “engagement” as an indicator of communication value.
The party might be over, but it was fun while it lasted.