Thanks to Promoted Posts Facebook Could Become Its Own Worst Enemy
Billionaire Mark Cuban is fed up with Facebook, so much so that he is moving his beloved Dallas Mavericks social media presence away from the world's most popular social network and onto - are you ready for this - MySpace! Not only that, he is also moving the 70+ other businesses in which he has invested.
His reason? The high advertising costs associated with Promoted Posts.
"We are moving far more aggressively into Twitter and reducing any and all emphasis on Facebook," Cuban told ReadWrite.com. "We won't abandon Facebook, we will still use it, but our priority is to add followers that our brands can reach on non-Facebook platforms first."
Cuban is not the only one in a furor over recent changes in Facebook's Edgerank algorithm that push down the reach of organic posts and forces companies to purchase ads in the form of Promoted Posts to broadcast their message to all their fans.
Tech blog Digital Trends reports on a widely syndicated blog post from pop culture site Dangerous Minds that, despite growing its Facebook fan base from 29,000 to 53,000 - an increase of 83 percent - it lost anywhere from half to two-thirds of the traffic from Facebook back to its site. “To reach 100 percent of our 50,000 Facebook fans they’d charge us $200 per post,” said the post.
Small businesses are feeling the pinch, too. A recent Wall Street Journal article cites Mountain Home, Idaho, caterer Richard Bishop, who said that Promoted Posts could end up costing him $9,100 per year based on the number of posts he creates each week.
Facebook says that its motive is to reduce the amount of spam in users' newsfeeds, but I contend that another motive is to bolster its stock price. Since advertising comprises more than 80 percent of its revenue, what else can Facebook do but find new ways for brands to advertise.
In response to the uproar, Facebook has developed some alternatives for brands including the ability for fans to add pages to an "interest list." In addition, Facebook is adding a "Pages" newsfeed - which you will see located in the left-hand column of your profile page - that is separate from the default feed and contain only posts from Pages you have liked.
Fan page owners can also take matters into their own hands by utilizing the following tactics:
- Post images and videos - these receive higher click-thru rates than text-only posts.
- Create shorter posts - they, too, receive higher CTRs than longer posts.
- Use "emoticons" - believe it or not, posts with emoticons receive a higher number of comments, shares and likes.
- Solicit fan interaction - use photo contests, fill-in-the-blank type posts, and ask fans to share tips.
- Respond quickly - when a fan submits a question or other comment, it's best if page owners can respond within the hour.
Still, that does not resolve the issue of reduced reach on organic posts that result in the need to advertise via Promoted Posts.
Mark Cuban has one suggestion - charge a flat monthly fee.
"The right price is to charge an upfront fee for brands. In the current system there is complete uncertainty on the cost. And even worse, at least for our size brands, you have to deal with the pricing for each posting, which is a time waster," said Cuban.
Regardless of its motives or the direction it needs to take, unless Facebook can get this under control the social network may find itself losing ground to sites like Tumblr, Twitter and even MySpace (amazing as that may sound).
What are your thoughts on this issue? Do you agree that Facebook is taking unfair advantage of brands with its advertising practices, or is it a required necessary evil in order to reduce newsfeed spam, just as the social network contends?
Tatyana Zakharova says:
Facebook is not really friendly to advertisers. It's annoying when ads are disapproved because help articles are really useless.
Elizabeth Ball says:
I haven't paid to promote any of my posts, but I find that I am either unliking businesses or hiding their posts from my news feed as they seem to post too even, at the expense of me being able to catch up on my friends' news.
I am very tempted to close my business page down altogether as it is a time-waster I could do without. Ironically of course, those who hang in there while other businesses depart could rise back up in prominence on customers' news feeds!
Facebook may decide to re-consider its advertising practices when the number of companies starts decreasing considerably, but what if it's too late. Greed is not a good adviser usually.