Insights, commentary and news

Recently Mark Zuckerberg took to Facebook to let users know that once again it will be changing its News Feed and they can expect to see less public content such as posts from businesses, brands and publishers. This comes as a result of feedback Facebook has received that brands are crowding users’ personal space. Facebook’s new algorithm will place posts that spark community interaction at the top of the Feed. Posts from friends and family, as well as groups, will also take priority on your News Feed and brand, celebrity, and influencer “page” posts are anticipated to fall in their rankings. According to Facebook, Pages posting content "people generally don't react to or comment on" will likely see the most significant drop in engagement, and "pages whose posts prompt conversations between friends will see less of an effect."

From a paid social perspective, we can expect to see ad prices rise on Facebook with this algorithm change. Where an average link CPC might be around $1.00 today for a particular brand, we could see this average rise to $1.25, $1.50 or even $2.00 for the same inventory. CPMs would follow this same trend. Exact increases remain unknown and will depend on the percent of page content removed from users’ News Feeds. In essence, there is some concern that advertisers will be getting less value out of paid investments on Facebook. Based on the principle of supply and demand, there will be less supply – and less opportunities for brands to be seen, so prices will likely rise. We predict that Facebook will continue to increase supply through other channels beyond the News Feed, namely Instagram and The Audience Network.

Facebook has been building their supply of ad inventory through their Audience Network, which has been around since 2014. The Audience Network includes ad placements that are not in a user’s News Feed, but use the same ad creative and targeting to reach users while they browse other sites across the web. For example, a Facebook ad would be served to a user while reading content on a website such as Mashable, WSJ or Huffington Post. It’s important to note that Facebook includes the Audience Network by default in any campaign setup within their advertising interface – the first indication that Facebook has a vested interest for brands to spend their advertising dollars there.

From our point-of-view, it seems as if Facebook has been preparing for this change for a while. Facebook’s staff (Partner Managers, Account Managers and Account Strategists) have been aggressively pushing our team to open Facebook ad placements to Facebook’s Audience Network and Instagram. It’s commonplace for almost all interactions with a member of Facebook support team to include suggestions of opening up all ad placements to the Audience Network and Instagram on any campaign – without regard to strategy or platform approach. While this does make sense for some campaigns, we use it with caution, and include it in the upfront plan for campaigns that could be a fit for the solution. Facebook benefits by selling more Audience Network space, but it’s not always a good social play for advertisers. This is a reminder of the importance of having an un-biased source to research, recommend and place paid media investments.

Facebook’s Audience Network often includes the same properties that can be purchased programmatically through a trading desk, or direct from a website. This can be done with a programmatic buy with more flexibility in targeting, more reach and frequency controls, more engaging and rich creative and most importantly, complete transparency into placements and pricing – something lacking in the Facebook environment.

As we look toward the 2018 launch, we’ll be taking this into consideration as we select the most meaning and impactful tactics. We’re also working with our Facebook reps to see if we can glean any insights around the timing of the rollout and we will share when this is available.