Brands are being “strangled” in talking to their Facebook fans because of an increasingly restrictive Facebook algorithm called Edgerank, which blocks companies trying to communicate with their own fans too much without a broader advertising schedule on the social media site.
According to James Hier, chief strategy officer at one of WPP’s media buying units, MEC, Facebook ad revenues were growing strongly in Australia but the social media juggernaut was clamping down on the ability of companies to talk to users who were existing fans of their brand pages as part of its evolving revenue growth strategy.
Hier said it was not peculiar to the Australian market but Australian corporates needed to understand unrestricted access to even their own Facebook fan base was increasingly regulated and Facebook had found a way to charge brands to ensure their messages were broadcast more widely.
He said marketers were starting to notice more restrictions on reaching their Facebook fan base with direct communications via the Edgerank algorithm, designed to block brands from bombarding and annoying an individual user’s feed with brand messages. He said there was a user benefit for the restrictions but they could be sidestepped through buying Facebook ‘sponsored posts’.
“Some time ago, people – and I include myself – were terrified that Facebook would put their hands around the throats of brand marketers and start charging us to have a brand presence,” he said. “They’ve actually done that by changing their algorithm which stops us reaching a brand’s full fan base. You’ve got to increasingly buy promoted posts to talk to your audience you’ve worked hard at trying to build.”
Hier said there was “a lot of finger pointing” going on about why Facebook campaigns didn’t work, although he stressed many did. Part of the issue was the creeping changes being made to Facebook’s algorithm which ensured that only the most active or highly engaged brand fans could receive a brand message. He said corporates needed to spend more time understanding whether social media campaigns were right under the new rules.
Hier said last week’s appointment of former Google executive William Easton to run Facebook’s Australian operation was strategically savvy because Facebook still had to work out how to really commercially leverage the consumer mindset when they were on the site.
“Google is all about [purchasing] intent and fulfilling demand,” Hier said. “It’s about people looking for stuff. People are not wandering on to Facebook to buy. People are on there to talk and share. It’s fundamentally different to Google [search]. Chief marketing officers are certainly spending more money on Facebook in Australia but they need to understand how to get it right more quickly. In some instances that might mean not doing something.”
This article first appeared in the 30 November 2012 edition of AdNews, in print and on iPad. Click here to subscribe for more news, features and opinion.
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