'It's not a cause for alarm': Why advertisers aren't fretting over Facebook's huge News Feed change (FB)

Mark Zuckerberg and employees

While publishers are bracing themselves for a massive hit and re-assessing their strategies, advertisers don't seem half as perturbed.
This is not the first time Facebook has tweaked its algorithm, and unlike publishers, brands have been paying to play on Facebook for years.
The one down side, however, is that ad prices might be driven up as people spend less time and scroll less on Facebook. But even then, brands have avenues other than the News Feed to run ads on.
Ultimately, advertising executives agreed that the changes will ultimately be good for the company and would help boost the quality of creative.

Facebook is set to start playing up status updates from friends and family in the News Feed in a bid to promote more "meaningful interaction" on the platform, thereby effectively deprioritizing content from media publishers and brands.

But while publishers are bracing themselves for a massive hit and re-assessing their strategies, advertisers don't seem half as perturbed.

Advertisers, for one, are well-versed with Facebook’s algorithm changes from time-to-time. This is hardly the first time that the tech giant has tweaked its algorithm and cast doubts on the reach of branded posts, forcing them to put more ad dollars behind their posts.

"Facebook has been 'pay-to-play" for a while now — the old days of posting a message organically and having half of your fans see it are long gone," said Stephen Boidock, director of marketing and business development at ad agency Drumroll. "The latest changes Facebook is making further negate the value of having a prioritized brand existence."

Further, while Facebook said that pages may see a decline in their organic reach, referral traffic and total video watch time, it also explicitly stated that paid ads remain largely unaffected by this specific shift.

That is how brands have been primarily using the platform for years anyway, according to Mike Dossett, VP and associate director of digital strategy at ad agency RPA. Organic reach, or the number of people who see a post without it having been boosted by ad dollars, has been low for years.

"Most – but not all – brands have long operated in an environment on Facebook where organic reach has declined precipitously and continuously over time to the point where it is often inconsequential as part of their overall reach," he said. "Very few brands regularly enjoy organic reach rates beyond 1-3%, which means a further decline in organic reach has a less sweeping impact for a brand at a macro level."

Brands will have to reassess their boosting strategies

Mark Zuckerberg The only aspect of the current change that has implications for brands is that they might see a slight impact within the ads auction, if they boost their posts, said Brittany Richter, VP and head of social media at iProspect.

"Brands need to use this opportunity to re-evaluate their boosting strategy and to also look at their organic strategy as a whole," she said. "But we're telling our clients that it's nothing to panic about."

Facebook reps are telling ad agencies to avoid "engagement-bait" and not encourage people to comment on their posts to get them to rank higher, as Business Insider first reported. It is advising advertisers to use the platform to drive business outcomes, and not chase engagement.

That often means long-term business objectives, instead of merely optimizing for audiences and scale, said Greg James, chief strategy officer at media agency Havas Media.

"It's not a cause for alarm as we've been working with them to buy ads against longer-term KPIs instead of optimizing for short term metrics like reach for a while now," he said. "This is a bigger picture shift toward what counts as a meaningful interaction."

Meanwhile, Facebook's move away from being an organic platform is good news for Instagram, argued Vic Pineiro, SVP of social media at Big Spaceship.

"Instagram has now matured to the point where it's most brands' primary social channel, and they treat Facebook mostly as paid media," he said. "This only cements that distinction until a similar fate is announced for Instagram."

The one downside is ad inventory prices going up in the short term

The one down side, however, is that ad prices might be driven up as people spend less time and scroll less on Facebook, offering fewer opportunities for ads to run. Mark Zuckerburg acknowledged that the company was anticipating users to spend less time on Facebook.

"From a paid standpoint, we'd have to look into how this impacts ad inventory cost and availability," said Sherwin Su, director of social at Essence. "There are possibilities that this may be status quo or become slightly more expensive should there be less supply."

Advertisers are finding comfort in the fact that Facebook offers other avenues for them to place their ads beyond just the News Feed though. Facebook, for example, has a dedicated video section called "Watch," which features shows from production studios and media publishers which advertisers can sponsor or buy mid-roll ads for.

"Facebook may scale or look into segmenting the feed experience to be about close communities, new ad experiences and inventory sources, such as within Live Videos, the Watch tab, Suggested Videos, or the content they're looking to prioritize," said Su.

Ultimately, while Facebook may face speed bumps in the short term, advertising executives all agreed that the changes will ultimately be good for the company.

"Mark and his leadership team are taking the long view – they want and need Facebook to be a net positive audience experience to continue to build a sustainable business for the long run," said RPA's Dossett. "With this new directive, brands who haven’t already made that a fundamental filter for their creative will absolutely need to do so – not only to appease the algorithms, but to ensure that they have a natural, authentic role in what could be the newly-characterized Facebook experience."

In other words, brands need to now focus on improving overall creative. Repurposing 30-second ads from TV was never a good idea, now it's akin to suicide.

"At the end of the day, you could look at this as a positive thing for both brands and individuals," said Drumroll's Boidock. "If this leads to brands spending more time and money creating better customer experiences and content, then we’re all for it."

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