Facebook is at the vanguard of squeezing increased value from paid social media marketing (SMM) – and other networks are following.
Twitter’s headquarters in San Francisco, California Photograph: Justin Sullivan/Getty Images
Marketers have been complaining for some time that organic reach no longer exists on social media and that brands have to pay for adverts if they want to engage with their target audience. These rumblings have been growing louder over the past 12 months, particularly in regards to Facebook, which some marketers claim is now little more than a glorified advertising network. However, it could be that Twitter will also become a so-called ‘pay-to-play’ network for marketers, as it recently hinted at plans to implement a news feed-style algorithm. This means users will no longer see tweets in one continuous real-time feed, but will be shown the content that Twitter deems to be the most important or relevant. Apparently the aim is to improve the user experience, but a cynical might suggest Twitter also wants to squeeze more ad revenue from brands by restricting their organic reach. To give some context to this debate, it’s worth looking at the evidence that’s stacking up against Facebook.
Dwindling organic reach on Facebook
Much of the disquiet among marketers has been fueled by Forrester research published in October 2013, which began with the bold statement that “Facebook is failing marketers.” Based on a survey of 395 marketers, Forrester found that Facebook creates less business value than any other digital marketing opportunity.
Forrester’s report analyst, Nate Elliot, claimed this dissatisfaction was due to poor ad targeting capabilities that failed to properly utilize social data, and a perceived failure to deliver organic reach. “Everyone who clicks the like button on a brand’s Facebook page volunteers to receive that brand’s messages – but on average, you only show each brand’s posts to 16% of its fans,” he wrote. Separate data published by Ogilvy in March this year showed that organic reach on brand pages had plummeted to just 6%, a sharp fall from 12% in October 2013. The situation is even bleaker for pages with fewer than 500 fans, as they saw organic reach fall from an already low 4% to just 2.1%. Ogilvy also quoted anonymous “Facebook sources” as saying that it wouldn’t be long before organic reach hit zero.
Ogilvy needn’t have relied on unnamed sources, as Facebook has been relatively open about its desire to restrict organic reach. In a sales deck distributed to ad partners at the end of 2013, Facebook stated: “We expect organic distribution of an individual page’s posts to gradually decline over time as we continually work to make sure people have a meaningful experience on the site.”
Organic reach is being crowded out
In essence, brands are being crowded out of social media platforms as content from publishers and people’s friends is given priority in the news feed. The document went on to suggest that Facebook fans were no longer a way to gain free exposure, but were instead a way of making ads more powerful as they provide greater social context. The Facebook report continued: “Your brand can fully benefit from having fans when most of your ads show social context, which increases advertising effectiveness and efficiency.”
Is the future ‘pay-to-play’?
It does seem that it’s becoming increasingly difficult for brands to gain any organic exposure on Facebook. The evidence from third-party research and Facebook’s own declarations make the future seem bleak for those who hoped that the free ride of social advertising might continue.
News from other social networks also suggests a shift to the ‘pay-to-play’ model.
On average, tweets only reach around 10% of followers as they are quickly drowned out by other posts, according to data pulled from Twitter’s new analytics platform. As mentioned, Twitter is chasing greater ad revenues and planning new controls that dictate what content users see in their feeds, so it could be that brands find their organic reach is further reduced.
Pinterest is also finally moving towards monetizing its platform through the use of ‘Promoted Pins’, which the company announced in June. There is currently a waiting list for this function, which may be the start of restricting what branded content users are exposed to. The company’s last funding round valued the business at $3.8bn.
We’ve already seen that Google is willing to remove privileges from its free services – such as hiding keyword data in Google Analytics tools – in order to boost its ad revenues.
Organic social reach isn’t dead yet
In April, new research showed that while on average many Facebook brand pages have seen a drop in organic reach, the top 1% of pages still reached 82% of their fans. It could be that it simply comes down to producing content that is both relevant to your audience and tied to long-term business goals, rather than chasing virality and looking for quick wins. Ultimately, it’s a matter of wait and see for how the social media networks develop their revenue streams and what this means for brand content.