One More Big Reason Why Facebook is Wrong for B2B

OK this was conceived, and should have been written, several months ago. Since then Facebook has taken a few steps, like rolling out dedicated newsfeed for brand pages, which might address some of the points here. Still, I am growing more and more convinced that Facebook is hurting itself in ways that make B2B marketers even less interested in using the channel. So in that spirit, here is my post.

There are some B2B companies and brands for whom Facebook makes sense as a social marketing channel. However, the majority of companies that sell highly engineered products to a technical audience via a long and complex buying cycle do not see much value from Facebook, either as a communications channel or an advertising medium. Primary among the reasons: lack of measurable results. Most companies do not know how, or whether, Facebook “likes” and engagement translate to any kind of measurable success, financial or otherwise. In addition, many B2B brands view Facebook as only a place for personal peer-peer interaction rather than a way to connect with their own highly targeted business  audiences.

On top of this understandable prejudice comes the news that Facebook has changed the EdgeRank algorithm that decides which members see what content. As a result the amount of newsfeed items seen by all of the followers of a particular brand page, for example, has been dramatically reduced. Each post is now being seen by a fraction of one’s Facebook audience; Facebook acknowledged  publicly that messages now reach, on average, just 15 percent of an brand page’s followers.

Facebook and its apologists claim that this is intended to improve overall functionality and maximize the user experience, but the overwhelming majority of bloggers and commentators feel that his change appears to be intended primarily to make money. Facebook personalities have encouraged the use of sponsored posts from advertisers as a way to reclaim the reduced reach; their advertising head Gokul Rajaram somewhat blandly explained, “sponsoring posts is important.” But think about that for a moment; through “Sponsored Stories,” brands, agencies and artists are now being charged to reach their own fans that they used to reach for free.

At least one prominent blog, Dangerous Minds, has labeled this a “bait and switch.” Their post calculates that it could take $3200 a day for them to regain the reach originally afforded them by 53,000 followers, and this underscores the secondary outrage—the cost Facebook is charging for its Promote capabilities. Dangerous Minds calculates that it will cost $200 a post to reach 100% of their audience. Needless to say, this cost is unsupportable by a small organization; because the cost of sponsoring posts is scaled according to reach, larger companies with bigger audiences could face annual costs in the tens of millions of dollars…all to reach their own fans.

The reaction has been overwhelmingly negative. Post after angry post has seen Facebook business users complaining and/or vowing to cut back. Most are especially chagrined at the sheer greediness of the effort; if Promote functions were only more reasonable, the outcry would be far less vituperative and adoption more widespread. But the high cost has turned champions into bitter enemies.

One can argue, and some do, that nobody is forcing anybody to be on Facebook. If you don’t like it, get out. Facebook has a right to monetize whatever they want and to whatever level they think is best. Some argue that the claim of financial motive is simply untrue, including TechCrunch. Everybody however seems to accept the fact that reach has been severely curtailed, and brand pages in particular are suffering.

For large consumer brands or media organizations that have invested heavily in building a Facebook presence, and leveraging Facebook traffic for their own revenue, leaving would be very problematic. However, the reality of the drop in organic reach will create serious pain while what seem to be usurious rates will almost certainly prevent any significant use of promotion to bring back more exposure. Brands are caught between the proverbial rock and a hard place—can’t live with reduced traffic, but can’t afford to sustain their reach.

In this light, the B2B brand that has avoided much investment in Facebook appears very foresighted, and is likely to see even less value in now pursuing FB as a viable marketing channel. Even as lines blur between business and consumer use of social media, and even if one accepts Facebook as a worthwhile B2B option, one still wouldn’t invest time, money, or energy in a nominally organic channel that seems to be engineered to fail in favor of a revenue-generating promotion-based alternative. One has to wonder about the longterm viability of Facebook’s very existence when it has done such unnecessary damage to itself; the growth of Promotion, with corresponding increase in revenue, could probably have been very successful, with just a little less greed.