Episode 21: Facebook’s Downhill Spiral: Still Good for Advertising in 2022?

Transcription:

Devin:

You’re listening to Digital Marketing Mondays. Each week, we bring you new and exciting content from around the marketing industry and help give you, the marketer, insights into what’s happening. We’ll offer our advice and share some takeaways to help you to develop better strategies for your marketing. Ideally, this will also help you improve your ROI as well. So with that, let’s tune into this week’s episode.

Devin:

Alrighty. So today’s episode is a solo cast. So you just get to have me, Devin, here talking to you today. Man, we got a lot to cover, but the big item that we really need to touch on is Facebook. And there have been a lot of recent grumblings about Facebook. Well, I shouldn’t say recent. More grumblings as of late. Yeah, there’s a lot of spiraling downhill that seems to be going on with Facebook at the moment. The newly renamed Meta Platforms released their Q4 earnings not too long ago. And they did see a 20% year on year growth for the fourth quarter. So that’s good. It still missed expectations, but all is fine there. But then the big shocker was that they ended up having the daily active users actually stagnate at 5% year over year gain, but it’s an identical number to what they had seen in Q3. So that leads to believe that the platform is not necessarily growing, but in fact, stagnating in terms of the number of active users. It’s a big red flag for a platform like Facebook.

Devin:

If you recall back in Q3, they had iterated that they really wanted to focus on eCommerce, Reels, and the metaverse. And unfortunately in this Q4 call what they also revealed was that e-commerce was actually an area that slowed down more so than most of the other platforms or areas of the platform that they had expected. So it goes to show that I think as marketers, we need to continue to stay on our toes and think about what are going to be the platforms where the most attention is at. At this point, if you’re going after that Gen Z market, it’s clearly still TikTok. TikTok did in fact see substantial growth. In the month of November alone, they grew 63%, which is a 13 percentage point increase from over a year ago during the same time period. That was research done by Forrester Research.

Devin:

So you can and see that they definitely have some challenges ahead of them. Apple continues to beat them up with their app transparency tracking and their issues related to that. So again, as marketers, we need to be thinking about what are the things that are going to drive the greatest awareness that will be meaningful and ultimately generate the revenue that we’re hoping for, whatever the goals may be set at. At this point, we’ve been seeing that more and more they are, they being Meta or Facebook, they are removing more ad targeting criteria than ever before. So it’s becoming very challenging to advertise on the platform. They did still continue to see growth as I mentioned, but definitely a cause for concern all the way around.

Devin:

So if you’re in the ad space and you’re thinking about what to be doing right now, now is a really great opportunity to be thinking about who your primary target audience is and what is the type of message that they’re going to be consuming on the specific platform at hand? One thing that I think was asked of us recently was how will these changes affect the advertising industry and particularly how effectively or efficiently can we advertise with all these targeting changes that are happening inside of Facebook? And I think the answer is it’s becoming a lot more broad and a lot more limited. So we unfortunately are going to have fewer options to be able to actually choose from in terms of targeting those folks. But at the end of the day, if you’re able to actually prove the ROI of your results, then there’s no need to stop actually advertising inside of the platform.

Devin:

I think it goes without saying as well in that they’ve been very clear since the Q3 earnings call that they really are focusing on that younger growth and using the copycat of their Reels feature to be able to go after those younger audience. So if that is somebody that you are looking to target, being that Gen Z, then we do recommend considering you think about creating content for the Reels-specific usage, or even looking of course, to an Instagram-specific usage. Though that may be targeting more millennials than Gen Zers at this point.

Devin:

But thinking about the content that you develop will also be critical here as well to seeing success inside of that ad platform. So there’s a lot of things that as advertisers you could be doing or thinking about, but of course, it all comes back to what’s driving the bottom line? What is bringing in the best results? And we have seen even several B2B advertisers that have done exceptionally well recently inside of the Facebook ad platform. So to some extent, if you have some extra dollars and some slightly more broad audiences that you could be targeting, I don’t think that Facebook Ads is a bad buy right now. However, if you are going after a more precise or refined audience, especially those that might be using job title targeting, then we still pretty clearly hang our hat on LinkedIn Ads as being a platform that we recommend you focus your energy on.

Devin:

One other thing I’ll call out at this point is that if you’re a B2B company, we have been seeing actually pretty exceptionally low cost per MQL or even cost per customer acquisition numbers coming out of Facebook ads platforms compared to especially Google or even LinkedIn. And one of the reasons why we think that’s the case is because there is so much inventory that is available inside of Facebook that’s overall a lower cost to play and slightly less competition compared to LinkedIn and Google currently that I think it can make sense to diversify your portfolio of ads and be able to actually run B2B ads on the Facebook ads platform.

Devin:

Now you’re certainly not going to get the targeting options like you have inside of LinkedIn or Google at this point, but we’ve been seeing that it can produce incredible results as long as you’re willing to create content that is really specific for the platform or the vertical where it’s going to be showing up. Case in point, if you’re going to be running Instagram story ads, you better have all vertical content. Don’t just rehash your horizontal banner ad from Google to display it inside of a vertical Instagram space. So that’s a prime example of needing to generate the content to best support where the ads are actually going to appear and having a low hanging, low friction call to action to drive people.

Devin:

The other thing that we continue to see is that with the audience matching coming out of different CRM or marketing automation platforms, you should be able to effectively target the people that you still need to actually get in front of. Now, you’re not going to have as much control, of course, given the app transparency tracking issue coming out of Apple, but I think you have opportunities to still target and get in front of that right audience. So there’s a big opportunity there that’s relatively low cost if you’re looking to diversify where your ads are showing.

Devin:

I think there’s a lot that continues to happen with Meta. And certainly I would hope that if you’re thinking about where should I be showing my ads for the rest of Q2 or into Q3, you may want to actually look at Facebook for the lower cost option. Again, we do recommend that you consider what type of ads and making sure that you’re developing that content specific for the ad platform or for the platform where your ads are going to be showing. But with that said, there are still some good options that are out there for you as well. So, entirely depends on your offer at the end of the day.

Devin:

But that’s it. If you have any questions, feel free to shoot us a note and as always, we love any and all feedback that you have about the podcast. So please do not hesitate to shoot us an email or leave a comment wherever you’re listening to this and let us know what you think. But thanks so much and we’ll see you next week.

Devin:

Thank you so much for tuning in. We really appreciate you taking the time out of your busy day to engage with our content. Whether you’re watching on YouTube or subscribed on our podcast apps, we appreciate you taking the time. Make sure to leave a comment down below and let us know any feedback that you have for us. We’re always watching the comments and engaging in any way that we can. So if you find this content useful, also make sure to subscribe or give it a big thumbs up. We appreciate it. Thanks so much.