Last spring we wrote about Facebook’s plans to develop Messenger into a platform on which it will sell ads. This naturally raises questions about the future for other publishers. Not to be too much of a Pollyanna about this, we think “this too shall pass.”
Why? Because Facebook exists in a moment in time, just like any other medium. As of now, it appears to have aggregated not only the content of 1.5 billion global individual users, but that of many of the major publishers through its Instant Articles initiative. According to received economic theory, this places all the profits in the hands of the aggregator.
However, look back a scant fifty years ago, and people thought the same about newspapers. All the “news that’s fit to print” was aggregated in the newspaper, so that’s where the ads went, and with them the profits.
We believe Facebook faces two problems going forward — problems that should give niche publishers some hope.
First, Facebook ads are truly useful in only a small percentage of cases. For performance advertising, it does not work well at all. Advertisers can spend large amounts of money accumulating “likes” without have those convert into sales. Yet Facebook ads, because of their reach, are becoming more expensive. They’re no longer an experiment; they require just the right kind of integrated, cross-channel campaign.
And for business to business, Facebook doesn’t work at all. It’s a platform that begins and ends as a consumer brand and intends to remain that way.
Second, advertising on Facebook is by nature interruptive. When people come to Facebook, they aren’t coming to shop; that’s for Amazon and EBay. They’re coming to catch up with their friends. That makes it very simple for a brand to alienate their customers by reaching out to them at inopportune times, which is why companies like Everlane plan only to use Messenger for customer service. We do not seek advertising on Facebook, and it is very difficult to make Facebook ads contextual. In the kind of data-driven environment we live in now, where ROI can be measured, small publishers with niche markets will perform better.
And here’s a bonus reason not to go “all in” on Facebook: it is already ten years old. The speed with which technology and consumer tastes change nowadays means we are probably at Peak Facebook, and the next latest and greatest thing, perhaps Medium, perhaps Snapchat, — who really knows? — may gradually siphon off the Facebook audience in the way Facebook has siphoned off audience from Yahoo.
It’s best not to put all your eggs in one basket.