A short feature for the Sydney Morning Herald’s IT Pro section. It’s my first work published under the SMH masthead. Excerpt below.
Self-service ad platform gives advertiser grief.
A Facebook employee has suggested the dramatic shifts in advertising rates on the company’s self-serve ad platform may be due to a “larger technical issue”, in an email to an Australian customer.
The customer, Tim Levinson [pictured], manager of Sydney-based hip-hop music label Elefant Traks, claims to have experienced price hikes of up to 1000 per cent on the social network’s self-serve ad platform.
Levinson has spent around $10,000 on Facebook advertisements in the last two years; roughly $100 per week, using the site’s pay-per-click model.
In late July, he wrote a concerned email to Facebook’s ad sales team, noting that the pay-per-click rates had gone “inexplicably through the roof” – from $0.50 per click to as much as $5. The Elefant Traks manager – who performs under the MC name Urthboy, and is also a founding member of popular Sydney hip-hop group The Herd – noticed in July that the estimated cost-per-click suggested by Facebook’s self-serve ad system wouldn’t budge on its ‘suggested bid’ amount, regardless of whether he was bidding on popular – and therefore, more competitive and expensive – keywords such as ‘triple j’ and ‘bliss n eso’, or significantly less popular terms such as ‘sydney underground rap’.
“I run a music business where a click results in an actual ‘sale’ only a certain percentage of the time,” he wrote in the email. “This is consistent across the board. The art is increasing that percentage through clever targeting. There is no way that $2 per click is value for money, let alone $3 or $4. There is no way that I gain useful information about the best keywords for targeting people who actually buy our product when the fee per click is the same, regardless of the targeted groups.”
It took two weeks for a Facebook employee to respond. In the month of July, Levinson had been charged between $25 and $71 each day. On August 5, “Josie” from Facebook’s ‘Online Sales Operations’ team wrote back and explained how the pay-per-click system worked, despite Levinson having used the ad platform without problems for two years. His concerns remained, so the email conversation continued.
For the full story, visit SMH IT Pro.