As Facebook revamps its news feed, marketers are assessing their strategies on the platform and bracing to shell out more money to get brands’ content in front of users.
On Thursday, Facebook said it would begin prioritising posts shared and discussed among users and their friends over posts from publishers and brands as it looks to amp up “meaningful interaction” on the social-media platform.
While media outlets may be worried about significant traffic declines from the adjustment, advertisers are all too familiar with Facebook’s routine algorithm changes. Over the years, constant tweaks have diminished the reach of brands’ content, forcing them to put more ad spend behind their posts to make sure people see them.
Marketers expect the latest overhaul will go even further, making it virtually impossible for Facebook users to see companies’ organic posts—those distributed by brands without paying to promote them. That will likely drive up ad prices and push companies to consider other advertising vehicles on Facebook beyond the news feed, some ad buyers say.
“It’s just an amplification of pay-to-play from Facebook,” said James Douglas, head of media at Reprise, a digital agency owned by Interpublic Group.
One immediate effect of the news feed change, Facebook Chief Executive Mark Zuckerberg predicts, is that the time users spend on the platform will go down.
Facebook’s vice president of product management, John Hegeman, said advertising will be unaffected by the changes, according to Reuters. But advertising industry insiders expect ad prices will go up as fewer scrolls through the Facebook feed will offer fewer opportunities to serve ads.
“It’s simple mathematics for a display business: Less time on Facebook and fewer ads can only mean that the ads that do show are more expensive,” said Paul Mead, chairman of London-based media agency VCCP Media.
That said, Facebook could choose to ramp up the number of ads it shows, known as its “ad load,” though it has expressed reluctance to do so in recent quarters.
Ultimately, “organic reach” on Facebook—a measure of how many people saw a post that didn’t receive a paid-for boost—has been in decline for some time.
In 2014, social media agency Social@Ogilvy published an analysis that found for Facebook pages with more than 500,000 likes, the average organic post was only likely to reach 2% of their fans.
The new changes are “practically the nail in the coffin for completely organic posts,” said Sarah Hofstetter, CEO of digital agency 360i. She said brands should now focus on making their paid posts more engaging.
Brands that have managed to buck the trend got ahead of Facebook’s algorithm change by focusing on driving conversations, rather than being overly promotional. Netflix’s Facebook page, for example, encourages fans to talk with each other about their favorite shows.
“The knee-jerk reaction is to think, ‘Oh my God, this is awful and very bad for publishers, and therefore brands,’” said Mobbie Nazir, chief strategy officer at We Are Social, which counts Netflix as a client. “But longer-term I think this is a positive thing…facilitating interactions between people is what social has always been about before Facebook even existed.”
Facebook’s guidance to advertising agencies suggests that marketers should not immediately alter their strategies as a result of the news feed ranking update, according to people familiar with the matter. The social network has warned advertisers against engagement baiting techniques, such as encouraging people to comment on their posts to get them to rank higher, and advises them instead to concentrate on using Facebook to drive business outcomes.
Facebook runs an auction-based system where it selects the best ad based on an advertiser’s maximum bid and whether the ad is likely to perform well.
The shift toward “meaningful interactions” on surfacing organic content in the news feed could have a slight impact within the ads auction when page owners pay to boost their posts to a wider audience, according to MediaCom U.K. Chief Executive Josh Krichefski. It might mean, for example, that pages deemed to have less value by the algorithm may not rank as high in the auction when bidding against a page that drives lots of conversations.
However, he added that engagement rates are a “very small” factor in the way that ads are ranked in the auction and most large-scale brand campaigns on Facebook don’t involve paying to boost page posts.
The news feed isn’t the only destination for marketers to advertise on Facebook. Last year, Facebook launched a dedicated “Watch” video section, which features programming from TV production studios and publishers. Advertisers can sponsor shows or buy video ads within the commercial breaks, known as mid-roll ads. Facebook is also testing a pre-roll ad format that will appear before the show begins.
The average view time on videos in the Watch section is more than 50% higher than Facebook’s self-reported news feed video average of 17 seconds, according to an analysis of 250 Watch videos by social media analytics company Delmondo.
Brands and publishers have a “love-hate relationship” with Facebook, but no matter how many changes the company makes to its algorithm, everyone has to play ball, said Reprise’s Mr. Douglas. Facebook “sits on so much traffic, you have to play by their rules.”