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Facebook is Making Free Marketing on Pages Less Powerful

Facebook Angle

In hindsight, it’s easy to see that it was only a matter of time. Facebook has been such an amazing marketing tool for businesses for a couple of years now, allowing effort and proper strategy to circumvent spending money on the platform. If a business worked hard and applied the proper techniques, they could perpetuate a formidable marketing strategy that helped with branding, drove traffic, and sparked engagement.

Facebook fixed that last month. Page administrators started noticing their statistics fading. In some reports, the drops were dramatic, chopped down to a third or less exposure of what was happening before. I almost wrote about it then but decided to wait to see one of Facebook’s infamous corrections. Surely, there would be outrage over them forcing businesses to pay in order to get exposure.

There was, to some extent. Many sites took notice. However, the “outrage” was limited as there was no real sympathy from users. It didn’t noticeably affect them. If anything, it helped to clean up their Facebook news feed to allow fewer business posts to appear. More images of nephew Timmy sliding into third base wasn’t such a bad thing, so Facebook is continuing with the current EdgeRank settings. Moreover, there have been suggestions and recommendations on various blogs that say users should start spending more money on it.

I was one of them.

This isn’t necessarily a bad thing. Facebook definitely needs to right-size their pricing; pages with a low number of fans can be promoted inexpensively, but once you start getting into the tens and hundreds of thousands of fans, the promotion costs go up tremendously. If they can make adjustments to their pricing, it’s only fair that they should make money for being a marketing platform.

Still, it’s annoying. It’s a bait and switch, regardless of whether that was the original intention or not. They hooked a lot of businesses into relying on engagement, activity, and quality content. They then pulled the rug out from under then and are holding the eyeballs of fans hostage. If you want to be seen, you have to pay up.

I cannot fault them for doing what they have to do to make their many investors happy. This is a business. They’ve provided a tremendous service that has struggled to make the money to justify both the size and price. Still, it changes the way that those of us in the social media marketing industry must calculate for Facebook. Strategies that are strictly organic have been devalued.

We’ll see how it’s working out during next quarter’s reports, but it’s a safe bet that this is the direction they’re heading. Businesses got snookered a bit, but not too badly. It’s just time to adjust.

Views: 116

Tags: Facebook

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Influencer
Comment by Jeff Glackin on November 8, 2012 at 7:26am

This is a great post! I love Ralph's additional comments and example. I sponsored a status on my personal Facebook just to try it out. It was only $7. Facebook reported that 73% more people read that status. 

Comment by Ralph Paglia on November 5, 2012 at 7:41pm

Check this out... Less than 24 hours ago I spent $100 to promote one of J.D. Rucker's previous ADM blogs.  It was the one about negative reviews being a great PR opportunity (which he learned from me, and graciously cited).

Here is the Facebook Page post and check out how many people have seen it (18,000+), and there is still more than half of the $100 budget remaining:

Excellent article, and one in which J.D. Rucker makes the case that Ralph Paglia was arguing on behalf for at the Internet Sales 20 Group in Chicago... Ralph truly understands why so many people want to avoid negative reviews, but when he s...See More
Negative Online Reviews Should Be Your Best PR Tool
The worlds of public relations and marketing have gone through two major changes in the last decade. The first one came with the mass adoption of the internet…
Comment by Ralph Paglia on November 5, 2012 at 7:08pm

Like Google has done with giving more SERP page 1 real estate to sponsored links and other revenue generating content, Facebook will as a business necessity continuously look for ways to convert anything of value for businesses and brands from the "free" or "Earned Media" realm and migrate the process or practice into the "Paid Media" fee based Facebook Advertising manager application and Facebook marketing services... To me, there is nothing wrong with this, and I have been aware of the strategy and have embraced it since I started working with Facebook on the Ford Digital Advertising Program in 2008.  Heck, it is sort of like the ads you see on ADM and other sites managed by my company, Automotive Media Partners, LLC... On a much smaller scale, of course... But that is why you see advertising on these sites, because ultimately if a network or website is to move beyond a "hobby" and towards a revenue realization model, you have got to stop giving away valuable marketing, communications, branding and advertising to transition into generating a fair income for the business owners... Facebook is no exception!

Since the early days of Facebook when I was privileged to work with Tom Chisholm (he took his FB stock, cash out and retired at end of 2010), he explained that the whole strategy around Facebook Pages for businesses was to give them away at no charge so as to drive demand for advertising within Facebook without those ads sending FB users outside of Facebook. To this day, you will find that any FB advertising that links to a site outside of Facebook does VERY poorly, especially compared to how impressively effective similar ads are when they point to a dealership's Facebook Page or an App within it (formerly tabs).  That is not the consumer, it is by design and built into the algorithm... Facebook makes sure that siphoning traffic away from Facebook is more costly and generates a lower ROI... Before you get irritated, I would do the same thing with my networks if I could easily make it happen! It makes ense from a FB perspective to encourage traffic coming into Facebook and all engagement and even business activities occur within the Facebook platform... Since FB is so eager to help companies develop their own business generating apps on the Facebook platform, it is difficult to criticize their strategy.

Take a look at last week's cover story in Automotive News about "Dealers Getting in Your Facebook" featuring Rick Case Honda and an interview with Richard Bustillo about his $2,000 a month Facebook Advertising budget... I convinced Richard to invest in Facebook Advertising starting last March and his campaigns within Facebook continue to generate more revenue and profits than any other $2,000 he spends on non-Facebook advertising media. It is satisfying to go from convincing a dealer to try it, and then to where it is the last part of his advertising budget he would cut!

Here is an excerpt from the Automotive News Interview with Richard Bustillo:

Dealers get in your Facebook

Stores post ads directly on site's news feeds

Richard Bustillo of Rick Case Honda says Facebook is taking advantage of new opportunities to reach customers by putting ads directly in news feeds.

Richard Bustillo, general manager of Rick Case Honda in Davie, Fla., believes Facebook has finally cracked the code to help dealerships sell vehicles and service.

Marketers have long viewed Facebook as an online cocktail party -- fine for socializing but weak for selling cars.

Now that's changing. Rick Case Honda and other dealerships are starting to take advantage of Facebook's huge potential to reach customers on the users' digital home turf, by putting ads directly into their customers' news feeds.

Technical improvements introduced in September allow dealerships to take their customer lists -- with just names and e-mail addresses -- and find those people on Facebook. The "custom audience" feature allows dealerships to push ads directly to Facebook users' news feeds, the must-see center column of the home page that consists of a constantly updated list of posts by a user's Facebook friends.

Facebook users are more likely to look at news-feed ads than those in the more common ad location, the right side of a Facebook page, the social media giant says.

"Facebook is starting to understand what we need to sell cars," Bustillo said.

In June at Rick Case Honda, an employee-pricing-for-all promotion on Facebook contributed to a strong month -- 615 new vehicles sold -- the most of any Honda store nationally for the month, Bustillo said.

Facebook played a key role in the campaign's success, he said. The store took its customer list with thousands of names and e-mail addresses and identified who were Facebook users. It then delivered to their news feeds the employee-pricing offer, Bustillo said.

Facebook also has improved the ability of dealerships and the factories to put promotional videos in front of car shoppers, Bustillo said. Facebook users are three to four times more likely to click on a video than a static ad, the company has found.

Read more: http://www.autonews.com/article/20121029/RETAIL07/310299951#ixzz2BP...


Influencer
Comment by Brittany Taylor on November 5, 2012 at 8:02am
wow, that explains a lot because i was wondering what happened to our business page. Numbers went down like crazy!

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