Facebook Starts To Get More Tougher & Mercenary With Their Ad Revenue Model

Facebook Starts To Get More Tougher & Mercenary With Their Ad Revenue Model

It seems that the good days are over at Facebook. Gone are the days when you can put up a free Page and expect every one of your followers to see your status updates. Now, status posts are being distributed to a select number of your followers based on “engagement”, and if you want everyone else to see it? Then pay for the privilege or risk becoming irrelevant.

It’s been estimated that only 1 to 2 per cent of followers will eventually see a post. Time is reporting that from October last year until February this year, the number of followers seeing a company’s posts slumped from 12% to 6%. The rest will only see it if the company chooses to pay Facebook. This means that if a company does not have the marketing budget to strike out on their own, then Facebook is effectively holding that company – and the company’s future – hostage.

Companies, websites, and celebrities were led to believe that you could set up a page on Facebook and it wouldn’t cost a cent unless you wanted to pay. So everyone flocked in, spending time and effort getting set up. Now that they are there, they are suddenly finding themselves trapped, being mugged up a dark alley by a smirking Mark Zuckerberg, who is saying “Ha! You fell for it!”.

This change of affairs has led to at least one business to publicly declare their displeasure at Facebook and announce that they were leaving Facebook. What was Facebook’s attitude? “Get used to it. This is the way it’s going to be from now on”.

Now you might argue that Facebook is a business with shareholders that needs to make a profit. That’s fine. But what is not fine is the sudden way in which this has been sprung on unsuspecting businesses, who now find themselves in an impossible position. Either pay Facebook what they are demanding, or leave the site and try to market on their own. The second option is perfectly viable if you are a huge company like Coca-Cola or Nike. But what about the mom-and-pop stores? The eBay businesses? The ones making a small amount of money, barely enough to get by? Now they have to decide the lesser of two evils. Otherwise their business will suddenly go down the toilet.

Even my fan page for my dog is about to go under, because only about 5 out of 56 fans are seeing a status message when I post it. Suddenly I have to come up with a marketing budget to tell my 56 fans everything my dog does?

What should Facebook have done? They should have introduced this gradually, to give businesses time to make other arrangements. When I say gradually, I mean not suddenly reducing the number of people who see posts for free so quickly. Reduce it slowly in increments, openly publicise what you are doing, and maybe offer special deals on ad sales. Something to sweeten the deal. But instead Facebook has put on something of a bullying attitude, effectively saying “we’ve got you by the balls. Now pay up”.

And it isn’t just in pages that we are seeing the sudden encroachment of ads. They are appearing in regular news feeds too – and in super-size.

With a size like that, you are not likely to miss them anytime soon, and that is probably the point! But companies looking to aggressively market a product may like the bigger, more prominent ad space.

One question you now have to ask yourself is how long will it be before we have auto-playing video ads? We already have auto-playing videos in status updates (albeit with the sound off). Is this Facebook testing and gauging the reactions of the users, in preparation for the auto-playing video ads?

One rather ironic development though is that right-hand column ads will not be seen in the mobile version of Facebook, as the right hand column is typically not seen on mobile devices. This is rather icky for Facebook as over half of their revenue comes from mobile devices!

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On the subject of ads, another rather disturbing development is coming to light. Facebook will soon begin tracking your browsing activity around the web, and then using that information to serve up what it thinks are appropriate ads on Facebook. For a start, let’s not get into the moral, ethical, and privacy reasons that this horrific invasion of privacy will entail. Suffice to say that you can opt out by going to this site, built by the Digital Advertising Alliance. Hopefully Facebook will respect and obey the users wishes on this site.

1 Comment

  1. For an English teacher there sure are a lot of basic grammatical errors.

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