Peanuts’ character Lucy was an expert at bait and switch, and Charlie Brown fell for it every time.
With its aggressive push toward the use of advertising – especially Promoted Posts – Facebook could have many small business owners feeling as if they have been lured into a scheme that promised a platform for free promotion but delivered a ploy to poke deeper inside their pocketbooks.
Maybe I’m being a bit too harsh, but a recent Wall Street Journal article – What’s a Facebook Fan Worth? – states that many entrepreneurs are “irked” at the notion of having to pay for posts in order to reach a larger number of their fan base. The article cites Mountain Home, Idaho, caterer Richard Bishop, who said that promoted posts could end up costing him $9,100 per year based on the number of posts he creates each week.
It goes without saying that every post doesn’t have to be promoted and that posting frequency should be limited to no more than two per day, but that’s not the point.
The point is, by forcing fan page owners to pony up anywhere from five to hundreds of dollars to promote posts that previously were free, Facebook has pulled a “bait and switch” on its business users. Even worse, the fact that non-paid for organic posts appear to have decreased reach (see here and here for data), one might consider it to be outright blackmail!
And the culprit, that darned IPO!
I said the other day that, thanks to the faltering IPO, Facebook would be forced to bolster its revenue, and it has chosen to do so via a number of advertising options, including promoted posts for both fan page owners and regular users alike.
This idea should cause no one to have a “Fred Sanford Big One” moment. Way back in February, marketing website Econsultancy drew the very same conclusion:
“[T]here is little doubt that the world’s largest social network will face increased pressure to monetize once it’s a publicly-traded entity. With user growth slowing, it will no longer be able to grow revenue as easily. That will not only push the company to monetize in currently unmonetised areas, like mobile ads, it may also logically push Facebook to serve more ads, and more aggressive ads.”
The WSJ article said the same thing: “The initiative is just one example of recent moves by Facebook to prop up its sagging stock price with new money-making products.”
Even though I’m using some strong language, I don’t mean to suggest that Facebook has some nefarious motive in mind, only that it is acting (or reacting) out of a sense of desperation. Still (and call it what you will), the effect is the same: in order for content to be seen by more than a few fans, businesses now have to pay.
(Of course, Facebook is not the only social network charging to promote posts; Twitter does it and Foursquare is also testing a promoted posts concept.)
This leads me to one obvious conclusion: selling products and services via social networks is no longer free – not that it ever was. Until now, however, most of the cost was associated with time, which could be considered a soft cost. Now, we’re talking hard costs in terms of dollars spent. And when it comes to that, businesses – especially smaller ones – are going to have to justify the investment.
Who’s to say that Facebook won’t supply some metrics-based solution to help, but who’s to say it will either. After all, that’s not the social network’s priority (or problem). The company has its own costs to justify – the stock price. (Talk about bait and switch!)
So, what do you think? Are promoted posts worth the cost? Is Facebook driving a hard bargain? Or am I over the top to suggest that it’s bait and switch?