Last quarter, social media giant Facebook set a record: In one three-month period, its advertising revenue eclipsed the $10 billion mark.
“But none of that matters if our services are used in a way that doesn’t bring people closer together,” said Facebook CEO Mark Zuckerberg on their November earnings call.
At the time he was talking about Russian interference and doubling investment in people to prevent it, but the language was also hinting at Thursday’s announcement that gives additional weight being placed on friends and family posts over pages and businesses in news feeds.
The massive venue for advertising also gives a wealth of tools to small businesses who might not otherwise have the chance to target the audience they want. The change in policy means that some digital advertising firms are going to have to do things differently on the platform.
“Because space in News Feed is limited, showing more posts from friends and family and updates that spark conversation means we’ll show less public content, including videos and other posts from publishers or businesses.” - Facebook News Feed FYI
“We’ve told our clients we anticipate a dip,” said Casey Whittington at communications firm The Whittington Group, “but we are going to work really hard to make sure that’s a very temporary step.”
Whittington’s clients focus on business to business sales, so he thinks that his clients will be less impacted than pages trying to sell directly to consumers.
“We’re gonna sell more ads,” said Ryan Kelly, CEO of Pear Analytics.
The trend away from business posts is not new, he said. It has been going on for two years. They have made some adjustments already, and he doesn’t anticipate this will have much impact on how they go about their work.
“What that tells me is that my ads are gonna get in front of less people, that’s true,” he said. “But those are the people who want to see ads.”
He believes Facebook will still push ads to people who have clicked on other ads or already follow a page or company. The algorithm change will make it more difficult to attract new audiences, however.
Largely, digital marketers will have to wait and see how the program rolls out.
Some investors haven’t waited to register their dislike of the plan. The company lost more than 4 percent of its stock after the announcement.
Paul Flahive can be reached at paul@tpr.org or on Twitter @paulflahive
