That’s all we’re left with after the recent announcement that Facebook, under the weight of scandal, has shed $120 billion in market value. For context, that’s roughly equivalent to losing the entire market capitalization of IBM or McDonalds in a single day (or the net worth of one Jeff Bezos).
It hasn’t all been bad news, though: Analysts noted that Facebook observed an 11% increase in daily active users (DAU) year-over-year. But following a call with shareholders, it soon became clear that the number of monthly active users (MAU) is in aggressive decline (3.14% drop in Q1 2018, 1.54% in Q2). Facebook’s slow user growth might seem shocking, but they already reach 2.2 billion out of the total addressable market of roughly 4 billion internet users on the planet.
It’s worth noting that the tech giant had forecasted and planned for this financial hit. The News Feed changes they ushered in at the beginning of the year, which reduced the number of ad impressions users are exposed to, were designed to prevent further user attrition on the platform. Looking long-term, this works in both Facebook’s and publishers’ favor — happier, more engaged users are good news for everyone.
Facebook’s grip over the advertising industry remains strong, but perhaps as we reflect on the year that Facebook has had, it’s time to ask the literally billion-dollar question: Should brands and nonprofits start thinking about putting their media budget somewhere else?
The answer? It depends on your audience — and your content. Here’s what you should be thinking about as you plan your next media campaign:
1. Is Facebook still the most cost-effective option for your digital ads?
Recent changes to Facebook’s News Feed, designed to minimize publisher content and maximize human exchanges, have pushed up costs per thousand impressions (CPM) by as much as 122%, as expected. Meanwhile, ad impressions have fallen dramatically:
Part of Facebook’s allure has historically been its low CPMs and costs per actions, including video views, email acquisition, and donations. Like a great British summer, it was fun while it lasted. But now that it’s raining, you don’t have to stick around.
Of course, the cost of Facebook advertising depends on the specifics of your campaign. For a video campaign to raise awareness of your cause, you might find better cost-per-views (CPVs) on Facebook than in skippable pre-roll inventory on YouTube. We’ve also seen video consumption on platforms like Twitter and Snapchat continue to increase, and we know that targeting options on those platforms are advanced enough for us to reach our highest-propensity audiences. Always invest a small budget to test against your existing Facebook campaign — that way you’ll generate tangible results that’ll help you understand which platforms provide the best efficiency.
Remember, while cost-efficiency is extremely important, it’s also essential that you look beyond unit economics. Inexpensive conversions of low-interest users (recruited, for example, from pay-to-play petition sites) are poor investments when compared to fractionally more expensive conversions of users with a higher lifetime value. Cohort analysis can help you track how these different groups behave over time.
2. Does Facebook still have the targeting options you need?
Meanwhile, Facebook has removed some of its most powerful audience targeting options — and seems to be making changes on an almost daily basis. While this is great news for privacy advocates, it’s quite a blow to advertisers. For example, you can no longer target people who “like” a specific Page, whereas on Twitter you can still target the followers of specific accounts. In 2018, you might find that there are simply fewer strategic advantages to sticking with the struggling 14-year-old media company.
3. Is Facebook the right platform for engaging your audience?
While Facebook is still the catch-all platform, not all forms of social media are created equal. For example, if you’re running a B2B campaign, your content may feel more at home on LinkedIn, whereas if you’re trying to reach fans of a specific subculture, say, Game of Thrones lovers, then Reddit already has a 1.4M user segment for you in their Game of Thrones subreddit.
Just be sure to “read the room” before diving in — for example, you can expect snarky replies from Twitter users, and Reddit contains plenty of content you may not want to associate with your brand. LinkedIn might be great for showing off your company culture, but it’s not a great place to mobilize people for, say, a donation drive or last-minute get-out-the-vote efforts.
Final Tip: The right ad platform is whichever one helps you build long-term relationships with your audience in the most cost-effective and brand-safe way.
If you’re still unsure as to where to place bets moving into the end of 2018, we highly recommend conducting some social listening to help you identify examples of public conversation about your cause: what your audience is talking about, what channels they use to talk about it, and who is driving the most conversation. More often than not, listening to your audience will yield some results that you’ll find quite surprising and worth researching further.
Want to make your media budget is reaching the right people at the right time? You’ve come to the right place. Get in touch with us.