How many people would click "despise FB" and "abandon FB" if those were
offered alongside the new "promote for a fee" button?
Just in case you haven't noticed, your Facebook activity may not be reaching
the FB audience you enjoyed a few months ago.
If you want to reach your previous audience, you need to click that little "promote"
button and pay the fee.
My friend Richard Metzger of
Dangerous Minds alerted me to a remarkable coincidence: shortly after Facebook's May launch
of the "promote" option for business accounts, business users noticed
an 85% reduction in their FB reach.
Facebook: I Wany My Friends Back.
Like many other "stealth" revenue campaigns in social media, the "promote" revenue stream
was first introduced as a marketing tool for enterprises and groups:
Facebook's tempting 'Promote' button for business (CNET).
It was presented as a way to expand one's reach on FB, to friends of friends, etc.
What was not highlighted was the "stealth" reduction in reach to "encourage"
use of the "promote" option:
Broken on Purpose: Why Getting It Wrong Pays More Than Getting It Right:
Many of us managing Facebook fan pages have noticed something strange over the last year:
how our reach has gotten increasingly ineffective. How the messages we post seem to get
fewer clicks, how each message is seen by only a fraction of our total “fans.”
It’s no conspiracy. Facebook acknowledged it as recently as last week: messages now reach,
on average, just 15 percent of an account’s fans. In a wonderful coincidence, Facebook
has rolled out a solution for this problem: Pay them for better access.
As their advertising head, Gokul Rajaram, explained, if you want to speak to the other
80 to 85 percent of people who signed up to hear from you, “sponsoring posts is important.”
In other words, through “Sponsored Stories,” brands, agencies and artists are now charged
to reach their own fans--the whole reason for having a page--because those pages have
suddenly stopped working.
Facebook is broken, on purpose, in order to extract more money from users.
Does anyone else smell the stench of burning opium in the air?
Step right this way, ladies and gentlemen, for free access
to exciting new marketing thrills--unlimited reach to a global audience!
Next, encourage them to depend more and more on your product for their marketing and
thus financial survival.
Excellent! They're now addicted, and without really noticing the rise of their dependence.
Now reduce their reach. We're sorry to hear you're experiencing withdrawal
symptoms; but unfortunately we've run out of the "free" good stuff. We do, however,
have a substitute that will fill your need, but there is a modest fee, of course.
Yes, it's the addict-pusher model.
Since few addicts complained or refused the new paid substitute, Facebook is testing the
addiction level of personal-account FB users:
Facebook’s ‘promote’ button rolls out beyond pages to some personal accounts
(9/18/12, Inside Facebook).
Facebook testing promoted user posts in the US.
The "promote" service is being, well, promoted, as a way to spread the word about
your garage sale this weekend, for instance. With the promote button, all the friends
of your friends in Ningbo, China, will helpfully find out about your garage sale
in Phoenix AZ. Just how helpful is that?
And all for only $7, if you have a small audience. The price scales up along with your audience.
Richard calculated that promoting all of his site's daily posts would require
$672,000 annually. The price of that once-free marketing is now rather stiff.
I have always been skeptical of the entire social media phenomenon.
I recounted some of my experiences in
How I Friended a Dead Guy and Became a Social Media Zombie (February 22, 2011).
I have also opined that
Facebook Is a Utility Which Can't Charge Its Users (July 22, 2010) for the
basic reason that Facebook has the same customer satisfaction ratings as hated cable
providers and the I.R.S. Users view Facebook as a free utility, and tolerate it because it's free.
I have also commented on the underlying dynamics of social media:
800 Million Channels of Me (February 21, 2011)
Are You Loving Your Servitude Yet? (July 25, 2012)
The Last Refuge of Wall Street: Marketing To Increasingly Insolvent Consumers
(December 12, 2011)
What's happening is that Facebook is realizing the advert model of revenue
is fatally limited. Adverts just don't generate billions of dollars in profit, even with
1 billion users. So it was inevitable that those using the FB platform to generate
revenue in some fashion would be squeezed to "share" their revenues with FB.
Previously "free" distribution would no longer be free, and users would face a stark
choice: either start paying for distribution or lose 85% of their audience.
The response depends on the users' level of dependence. Those who are well and
truly hooked on the FB platform can either make ineffectual protests and end up paying
to reach their former audience, or they can quit: cold turkey, baby.
The alternative FB hopes they don't choose is to do nothing, accept their reduced
reach and audience, and move their social media energy elsewhere. Most personal
account holders don't really care about their reach; as long as their inner circle
still get their posts and photos, they're happy.
So FB will eventually have to decide if it can profit with a customer base in which 99%
don't pay anything. They could try squeezing users in more "stealth" ways, for example,
making the first 10 friends and first 10 posts a week free, and charging for useage
above a low threshold. If it follows this revenue model, it will follow MySpace down
the path to hosting tens of millions of zombie users.
Or FB (and Wall Street) could accept that it is fundamentally a low-profit utility and
always will be. It could charge individuals $1 a month--a utility fee, in effect--
$10 a month for groups and small enterprises and $100/month for corporations and
large organizations. This model would recognize FB is basically offering server space.
If users aren't getting $1 a month in value, then why be users at all?
How addicted are we? It's a good question of all social media, especially the
(currently) "free" stuff. How many people would click "abandon FB" if that were
offered alongside the new "promote" button?
Source: Of Two Minds