cornea gumbo

20 April 2012

Ad Nauseam: The Problems With Facebook Advertising

by Freddy Tran Nager, Founder of Atomic Tango + Former Facebook Advertiser…

Facebook Ads

Ads that appeared on my Facebook page. Why do I feel like these ads are related, and that clicking any of them will get me into trouble?

I used to buy Facebook ads because I was enamored by the targeting capabilities. For example, when promoting a local theatrical production, I could easily target the zip code and even a surrounding area, the right age group, actors and directors and other theatre types, fans of the playwright, and people who might like the play’s subject matter. In addition, I could easily test ads and make changes, and switch payment from cost-per-thousand views (CPM) to cost-per-click (CPC) at the touch of a virtual button. The tracking data showed me what was working and what was not. This seemed like the perfect ad platform.

Then I noticed that “not” was becoming more common than “working.”
And I’m not alone in this discovery…

The Great Disappearing Clicks of Facebook

Click-through-rates on Facebook have plummeted to 0.01%–0.05%. For those who don’t like percentages, 0.01% means that you get 1 click for every 10,000 views. And according to researcher Dr. Augustine Fou, that 0.01% may just be rounding, since Facebook doesn’t go beyond two decimal points in reporting rates. In other words, the actual number may be 0. As in zip, nada, the big empty.

But what about those 10,000 views? Those have to be worth something, right? That’s branding and awareness! At least, that’s what Facebook’s own sales reps are now saying. ([intlink id=”4318″ type=”post” target=”_blank”]Something I ridiculed in a previous post.[/intlink]) But like most advertising, “views” are more theoretical than actual. Yes, the ads appear on a user’s page, but with all the clutter and distracting content, we web users have developed ad blindness. The ads are there — we just tune them out.

That’s nothing new: long ago it happened to banner ads on other sites, such as MySpace. Indeed, we consumers became so blind to ads that, in order to get our attention, ads became annoying: flashing, jumping, telling you that you had won a free iPod. Marketing stupidity in full effect. Facebook’s ads haven’t made that suicidal leap to annoying… yet. But wait till that IPO goes through, and the shareholder demand for quarterly growth kicks in.

Also — and this is key to remember — unlike a magazine ad, those 10,000 views on Facebook do not mean 10,000 people. I complained to Facebook when I saw that my ads were being shown to the same people 17 times. While some ad repetition is necessary to register with consumers, anything more than 3 usually crosses the line from “Alright, I see you” to “WTF is your problem?! I hate you and will never buy your product again!”

Facebook wouldn’t let me limit the frequency of exposures. Why? Because when you’re buying an ad, Facebook entices you with a large number that counts all the people in your target market. But that number reflects registered users, not active users. The actual number of active users is much smaller, so in order to charge you for thousands of views within the timeframe of your ad campaign, Facebook jacks up the frequency of exposures to a single active user.

And that number of active users on Facebook? Oh, they’re declining, too.

While the number of registered Facebook users is quickly approaching 1 billion, they’re like visitors to the Grand Canyon: some stay and hike around; others get out of the car and say, “OK. I see it,” then get back into the car and drive away.

According to Dr. Fou, more people on Facebook are driving away:

“From Compete data, we can see that pageviews are down 54 percent at 48 billion, from a high of 100 billion pageviews in August 2010. Average stay is down 35 percent at 17 minutes from a high of 26 minutes in January 2011. Visits per person is down 34 percent at 20 per month from a high of 29 per month in January 2011. And pages per visit is off 60 percent at 15 pages from a high of 35 in February 2010. These declines have been in nearly a straight line and have been consistent over many months, not a temporary glitch.” (from “Facebook’s Achilles’ Heel” on

Abandon ship! Or at least shop around…

Facebook users are the product, not the customers, so we have to just take whatever Facebook imposes upon us. It’s no longer the promised land for either consumers or advertisers. With Facebook’s IPO around the corner, Zuckerberg needs to show activity and growth and vision before unloading Facebook to suckers investors.

The impending Facebook IPO is being seen as the mother of all Web 2.0 IPO’s. It’s anticipated to be valued at over $100 billion. Certainly nothing to sneeze at. And even after the IPO, I suspect that Facebook will keep going for years, perhaps decades to come…

Dr. Augustine Fou’s “Facebook Ad Scam”

Tags : , , , , , ,

Freddy is the Founder & Creative Strategist of Atomic Tango. He also teaches graduate-level marketing communication courses at the University of Southern California (go Trojans!), shoots pool somewhat adequately, and herds cats. Freddy received his BA from Harvard and his MBA from USC.

Notify of

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Newest Most Voted
Inline Feedbacks
View all comments
Spark Tech Talk
12 years ago

As it commercializes more and more, real users start to flee. Maybe with the new “value” of the site, they can get some great strategists in and revise some.

12 years ago

Finally, someone else who recognizes the AOL -> MySpace -> Facebook ‘evolution’. The new timeline profile design is the natural step in Myspacification.

However, Facebook has done a pretty good job at maintaining their web2.0 supremacy. They have integrated themselves into the rest of the web, something AOL and MySpace could not do. I had hopes for Google+ as Facebook’s eventual successor (especially with that sweet Hangout feature) but it seems Google is destined to fail at all of their social network ventures. Anyone remember Buzz? Me neither.

Glad I stumbled onto your site just for this, cheers!

12 years ago
Reply to  Igor

Thanks for the comment, Igor. I agree with you: Facebook has done a good job of maintaining its Web 2.0 supremacy via web – and cultural – integration. Whether that’s enough to keep Wall Street happy remains to be seen. But yes, there appear to be few challengers to Facebook’s supremacy on the horizon.

12 years ago

Some great points. Assuming ads (and other elements) make users leave Facebook, what’s the (inevitable?) next step? Paid social platforms, a fracturing of the audience between platforms (there was a MySpace/Facebook split for a while), the ongoing development of new free social platforms… or something we haven’t even thought of yet?