“Gee, golly, whiz” has been the go-to excuse meme rolled out via Zuck & Crew any time there has been some form of scandalous controversy.
And so far it’s worked flawlessly, up until now. For this time, it’s different.
There’s a reason why businesses always remained at arm’s length (at least publicly) from the political strata. e.g., You have to pick a side. And once you do invariably begins the digging for the inevitable and unavoidable resulting pitfall.
The reason is simple: Any wrong move or action deemed offensive to the so-called “favored,” results into instantaneous pariah status, for any violation of the subsequently favored amounts to absolute betrayal, and immediate damnation, with no recourse for apology.
This is why businesses have always averted it. And is why Facebook’s (FB) problems – have only just begun.
The issue now facing FB are manifold, but they main driver will emanate from a place going forward, which many thought was near unassailable in recent years. i.e., It’s entire ads-for-eyeballs business model based on Wall Street’s assumed projections. Hint: Those “eyeballs” just received a “sharp stick.”
I have made the case over the years that FB was no different, in many respects, and would one day find itself at a precipice of what could result in a death spiral of similar fashion as the juggernaut that came before it. e.g., AOL™. I have also stated that moment will manifest and become clearly visible the instant its ads-for-eyeballs model gets dinged. Because just like AOL before it: The stock was priced for perfection, and the moment ad revenue projections were missed? It was over.
I believe that same precipice and set up has been reached for FB, and here’s why:
Regardless of what one thinks or feels about a certain political view, the fact of the matter is FB makes its money based on people using its platform to engage with those users of either side, or anywhere in-between, whether they’re content providers or consumers. i.e., It sells those eyeballs to advertisers.
And FB has made a mockery of business ethics and practices as to explain why advertisers who may indeed want to advertise to any specialized audience (i.e. pay the ad freight) that their ad campaigns are reaching their intended audiences.
Think of it this way: You may not like cat videos. But advertisers that want to reach those people who do have an expectation that the metrics they’re being charged for, to do just that – are being delivered – as was sold. It’s that simple.
And make no mistake, this simple point is the only metric that matters to advertisers. For this is how advertisers base why, or if, they’ll spend money at all. i.e., If you state I’m to reach X amount of eyeballs, then X is what needs to be delivered. Anything less and there’s hell-to-pay, or worse, refunds to be issued.
And FB has shown time and time again, that what they say in response to anything which questions their metrics – is not to be believed. For it changes faster than a Kardashian profile pic. Case in point:
Remember when FB was first accused of censoring conservative voices or viewpoints? Remember the response? Hint: It began with a meeting of Zuck & Crew and a few of the more prominent content providers resulting in nothing more than a spectacle of:
“Gee, golly, whiz, how could this happen? We don’t do that, it must be a blip in the algorithm. After all, no humans are in the mix. It’s all machines and algos, so that must be the issue, blah, blah, blah…” Only to be met a short time later with: “Oh, gee, golly, whiz, we’re sorry. There are people who are actively doing that, we’ll put a stop to that immediately!” To be met once again in just as short a time period: “Oh, gee, golly, whiz, it appears outside forces (i.e., our critics that we care more about that you) want us to do even more of that suppression. So, gee, golly, whiz, we’re going to suppress you even more, but take comfort in the idea that at least we’re now telling you we are, instead of lying about it as before.” And on, and on.
To reiterate, whether or not you agree or just peruse their content, is meaningless to this discussion. What the main point is, is that there are (all conjecture of course, but reasonable assumptions) advertisers that paid for the access to have their ads presented to this audience. And, were sold that privilege based on algorithmic methodology.
And that is where the dirty little issue resides. Why? Because, by FB’s own words and actions, they admitted, they were actively suppressing content. This was another reason why I stated the Steven Crowder lawsuit was so fascinating and a key issue to watch. Again, the reasoning is simple:
If a company is charging for one metric, but simultaneously engaged in adulterating that metric via its own actions negatively, and not supplying addendums or up to date price adjustments? Not only do you have credibility issues with advertisers – you’re going to have lawsuit issues as far as the ads-for-eyeballs model can see.
The real issue at hand is this: All the above is just for context, and is small potatoes, in comparison to what is now at hand. i.e., Zuck & Crew’s latest fake apology debacle. Or said differently: This time – it’s different. And that’s a very, very, very, (did I say very?) big problem for FB from here on out. Here’s why…
Advertisers have been leaving FB in very public ways over the last year or so. Next-in-rotation fund-managers across the mainstream business/financial media will point to their earnings reports and decry “See, see!!! They’re wrong, FB is unassailable.”
That is a fair point, but the dirty little secret I’ve argued ad nauseam, is that FB has more-or-less been the recipient of “last man standing” rewards, more than anything else. For if their ads were working as described, then why are the worlds largest advertisers scaling back?
The other issue that has worked to FB’s benefit has been something akin to the old mantra of, “No one ever got fired for buying IBM™” of the late 80’s.
This was when computers and software were new ideas, and purchasing departments were scared to death of being brought up before their respected boards and asked to explain why all those “great benefits and ease of use” not only never materialized, but have since gone on to become a sinkhole where money is just shoveled into, with no end in sight.
Computers and systems were notorious for crashing back then, bringing entire systems and companies down with them. IBM (as flawed and stoic as they were back then) was seen as “the gold standard,” even if it was inherently no better than a competitors.
But if the system crashed and was an IBM? It was shrugged off as, “Well, nothing we can do about it, I guess,” If it was on something else? Usually the next response – was a pink slip. Hence why IBM’s dominance lasted longer than it should have.
It was when people began getting fired for not replacing IBM with better systems that IBM never recovered. I’ll contend FB, much like AOL, much like IBM before them, is now facing this same Pandora’s box. And it is Zuck & Crew in their latest data scandal that has opened it.
Suddenly FB’s core user base is outraged. It was one thing to sell their data to those whose political views they agreed with, but to openly allow another to do with it the same? Heresy! And what’s worse? FB allowed for all their friends data to also be vacuumed up and used via third-party apps and others. A violation in todays world of mobile that’s viewed as the equivalent of some form of criminal offense.
It is this point where FB has stepped too far and the backlash is just beginning. For it’s one thing to take advantage of access to what one thinks or believes they are surrendering for the privilege of “free” usage. It’s quite another when they feel their privacy has been invaded without their consent.
Mobile devices are so personal to today’s users, that going anywhere within, without their expressed, understood consent – is akin to entering someone’s home or apartment via using the key they leave under the mat. Even if you went in, touched nothing except to look around and left a $20 bill on the counter for the “privilege?” There would be outrage, and with good reason.
To make clear: If you, or any company thought that because a person signed off and gave you the “right” to do something similar and would fly, because in some 2000 paged “terms of service” disclaimer one could point to and say, “You gave us the permission to do just that. See, right here on page 1875, paragraph 8, subsection 1.3a it clearly states…” I have some ocean front property in KY I’d love to sell you, cheap.
Think I’m off base? I made the same argument when the furor erupted at Apple™ when they planted U2’s newest release, for free, into people’s iTunes™ library. The reason for the backlash was easily seen, that is, for everyone except Apple, at the time.
These are now digital identities, as well as homes in the ether, for many. “Keys left under the mat” for access are believed to be understood much the same way that a landlord or family member may know it’s there. i.e., I know you may enter, but you had better have a damn good reason for it. Period.
The backlash against FB’s access to “keys” has now morphed into a movement complete with hashtags (which I just find rich!) calling for users to delete their FB accounts entirely. And it’s picking up steam.
Everywhere you turn there is now another celebrity, or former business associate of FB (WhatsApp™ founder is just the latest) calling for FB’s demise. “Don’t use FB!” “Get your kids off FB!” “FB’s data betrayal proves they can’t be trusted!” and on, and on. As I stated in an earlier article, FB’s “Messenger Kids” was their Joe Camel® moment. It’s now just steamrolling, in much the same way.
And the biggest excuse that matters in all of this, is what I alluded to in the headline. i.e., This latest excuse coming from Zuck & Crew, about their handling of data, is just the excuse many an advertiser needed to stop spending precious ad dollars on FB, if not the entire social media model in general. Why?
Because if it was working as sold? Advertisers wouldn’t be so forth coming, stating they’re now pulling ads away. i.e., If those ad dollars were producing results in-line with their expenditure? Businesses would be very hush-hush, in a much more wait and see mode of operation on what to do next, if anything. That’s a very big tell-tale sign, or clue that should not be overlooked, in my humble opinion.
The only reason a business (generalization, of course) cancels any type of advertising that is working, with great fan-fare, or decry of public outrage, is that in doing so, it is seen as a greater sales tool – than keeping the original ad budget expense.
Or said differently: This is the perfect excuse to soothe jittery boardrooms or executives to no longer spend precious ad dollars on social, and possibly try other avenues or venues. The reasoning is simple:
If there are going to be less content providers via FB’s own censorship, along with a full-blown user revolt? Then, much like IBM found itself in-the-blink-of-a-cursor back in the final go-go days of the dot-com era. People began getting fired for not seeking IBM alternatives rather than just going with the assumed “competitive brand leader.”
FB is in this double whammy situation in my view. For like I’ve also argued: The moment Wall Street’s current ads-for-eyeballs model or projections are seen to be in jeopardy against the backdrop of a stock, that’s for all intents and purposes, “priced for perfection?”
Just – like – AOL.
© 2018 Mark St.Cyr