New York Ad Week Reveals Facebook’s Problems

New York Advertising Week was very revealing, both about the state of the industry in general (existential angst), and about Facebook’s problems in particular. I predict by next year there not only won’t be a duopoly–that’s well on the way because of Oath and Amazon–but will be a considerably more open marketplace.

Facebook has begun selling video ads through a program called In-Stream Reserve. Similar to YouTube’s Google Preferred program, In-Stream Reserve puts a velvet rope around Facebook’s most prized video inventory and sells it as a standalone package. However, what Facebook considers prized programming may not match with advertisers’ expectations, especially among TV ad buyers who are accustomed to buying individual programs on linear TV and may be unfamiliar with Facebook shows like “Fear Pong” and “Truth or Drink,” which along with MaxNoSleeves are also part of In-Stream Reserve.

When Facebook pitched the program as a test earlier this year, it asked advertisers to commit to spend $750,000 over three months. The price tag has since dropped to roughly $250,000 over three months, according to two agency execs with knowledge of the matter. A Facebook spokesperson declined to comment on pricing.

And from Casey Newton’s newsletter, another problem:

“One, my people are mad at Facebook for requesting that they register as political advertisers in order to promote their gay cabaret shows. Eli Rosenberg reports in the Washington Post:
The Washington Post found dozens of advertisements mentioning LGBT themes and words that the company blocked for supposedly being political, according to a public database Facebook keeps.
The rejections, the majority of which Facebook told The Post were in error, underscore the company’s challenges in regulating the massive amount of information flowing through its service, an issue that burst into the fore after the disclosure that Russian-state actors used advertisements on Facebook to sow discord during the 2016 U.S. election. But they also touch on a deeper tension as the company seeks to better regulate political uses of its platform. Though Facebook has taken pains to appear neutral, the censorship of LGBT ads, however inadvertent, points to the company’s difficulty in finding a middle ground in a tense national climate where policy increasingly hinges on fundamental questions about race and identity.
It’s too much to say that these ads were “censored.” Registering as a political advertiser is certainly a hassle; it involves the US Mail. But Facebook didn’t reject the ads so much as it requested more information about the advertiser — which, as the Post notes, the company later admitted that it did in error. Securing the platform means hassling lots of people, some of whom will be hassled unfairly. “
All this serves to convince me that next year will be a better year. And as Will Smith said, “nothing is more valuable than your gut. The metrics are there just to train your gut.” I trust my gut about the state of the ad business all the time, and we’re still here.