Facebook says fall in organic reach is not a money play

By Rosie Baker | 10 June 2014

Facebook has categorically denied that the tweak to its algorithm that has had marketers and advertisers complaining about a sharp decline in organic reach has anything to do with it making more money through advertising. It does, say agencies. But Mindshare has supported the move and Facebook's defence.

The rumblings from agencies and advertisers about fewer people seeing posts on Facebook have been rife, with marketers complaining that their efforts to cultivate fans and followers has been wasted.

Facebook has concede that it is a “pain point” for brand marketers and said it needed to be better at helping brands  understand why organic reach is declining - and why that is not a bad thing.

Brian Boland, Facebook ads product marketing boss, likened it to search marketing and the need for brands to pay to appear on the first page of search results.

In a blog post Boland said: “Our goal is always to provide the best experience for the people that use Facebook. We believe that delivering the best experiences for people also benefits the businesses that use Facebook. If people are more active and engaged with stories that appear in News Feed, they are also more likely to be active and engaged with content from businesses.

“Online search engines, for instance, provided a great deal of free traffic to businesses and websites when they initially launched. People and businesses flocked to these platforms, and as the services grew there was more competition to rank highly in search results. Because the search engines had to work much harder to surface the most relevant and useful content, businesses eventually saw diminished organic reach.”

While Facebook might say it's not directly about making more money, agencies disagree. Facebook only sees around 40% of the total budgets spent on Facebook and James Heir MEC chief strategy officer James Hier said it was an “obvious” move for Facebook to try to “claw back” some of the budget that is spent on Facebook, but goes to social and community engagement agencies.

Mindshare chief digital officer Ciarán Norris agreed that the money move was really about “not scaring away the audience” which, if it happened would in turn mean a fall in revenue.

“It's about money in that they don't want to kill the goose [by cluttering the News Feed]– which is the audience. If they lose users, they lose revenue streams.” he said.

Facebook claims more than 1,500 pieces of content could appear in a person's News Feed every day – and it could increase to 15,000 for people with more friends, who like more brand pages.

The growth of users, more brands being on Facebook and the move to mobile has made it easier and quicker to share larger volumes of content. That means that the News Feed is more competitive environment for content, suggested Boland.

Instead of showing it all, Facebook said it chooses 300 of the “most relevant” pieces of content by ranking them using an algorithm. Boland claims that showing every piece of content in real time would actually mean a further decline in organic reach and that its approach offers better engagement.

Basically, Facebook wants brands to supplement organic content with paid content using its audience targeting tools.

Fans, said Boland, are still valuable as they provide a “social context” for ads but “should not be thought of as an end unto itself”.

Mindshare's Norris said: “You need to work hard to gain and earn attention and people had gotten used to just gaining attention for free. It's not necessarily a bad thing because it forces [brands] to think about who they want to reach and why – not just sticking up a picture of a cute cat to get 100,000 hits. You tend to value things you pay for more than things you get for free.”

Facebook also issued a stark warning to brands not to get too comfortable with the way things are because Facebook isn't about to let the platform stand still. But the company conceded it needs to be more transparent about how its ongoing changes affect advertisers.

Boland said: “We’ll always innovate on behalf of the people who use Facebook. And we must be more transparent with and helpful to the businesses that market on Facebook. We’re working hard to improve our communications about upcoming product changes. We’re committed to helping your business grow and making sure you get the most from your investment in Facebook.”

For more on what brands and agencies think on the issue, pick up the next issue of AdNews in print. It's out on Friday (13 June).

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