

Why Mark Cuban is wrong about Facebook - patrickod
http://pagelever.com/fact-check-why-mark-cuban-is-wrong-about-facebook/

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corin_
$3 CPM is far more expensive that generic Facebook adverts (known for being
very cheap in terms of CPM), and it's a fairly typical price for digital
advertising. Obviously it depends on the industry, the audience, etc. etc. but
$3 is fairly common.

The reason it feels like such a terrible deal here is that you aren't paying
$3 CPM to reach a new audience, you are paying $3 CPM to reach _your_
audience. Sure, Facebook can argue "it's the most targeted audience possible,
they're Mavericks fans!" but the counter to that is "of course they are, it's
my brand that put this audience together".

Brands use Facebook because it's far more user-friendly than trying to collect
your fans together on your own website, and therefore it's a better solution -
easier for your fans means more will do it, so you have more people to market
to. However the comparison is that they're people who have chosen to subscribe
to you, and therefore the pricing comparison is not to digital advertising,
but to writing to fans on a website, or a blog, or through email newsletters.
This is why it feels like, and arguably is, a rip off.

As to the argument that it's needed from a user's point of view and that
Facebook happens to be able to monetise to help their users (e.g. jeffwidman's
comment: <http://news.ycombinator.com/item?id=4785852>) I'm not really sure.
It's probably a valid point. I'm not a Facebook user myself (but my marketing
work occasionally covers Facebook), my personal feeling is that if I follow a
brand it's because I want to see their updates. All of their updates. In my
head, it's the same as signing up to a newsletter, or subscribing to an RSS
feed, just through a convenient third party. But as I don't do it myself, I'm
happy to consider myself wrong, or in the minority, maybe if I was an active
user following many brands that I care about I would find that getting 100% of
their messages would ruin my Facebook experience.

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MattRix
Spot on!

One thing to note, when you said "my personal feeling is that if I follow a
brand it's because I want to see their updates", the tricky think about
facebook is that you don't "follow" a brand like you do on Twitter, you just
"like" them. In my opinion, it's a small but important distinction. Just
because you enjoy a certain brand doesn't mean you actually want to know every
little thing they're doing.

~~~
jack-r-abbit
Exactly. At first I was all "I'll like every FB page of things I like in RL".
But then I was getting annoyed at some of the crap that these pages were
putting into my feed so I "unliked" pretty much everything. I wish there was a
way to "like" something so that it is reflected in your interests and what
not, but NOT get their updates. Maybe there is and I haven't seen it.

~~~
huffman
When you click to remove a post from your newsfeed, facebook prompts you with
"unsubscribe from this page's updates" — there's also a tab in the top right
of these stories (and of people's updates) that allows you to set the
frequency you receive news from them.

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loceng
Fact Check: The fans on the Facebook pages were driven there by the page
owner, likely through other marketing channels such as TV. It should be a
mutually beneficial relationship, though Facebook is trying to take advantage
of that relationship now. Companies and people are mobile on the internet.
They can drive people wherever they want. Mark Cuban's action is a huge
signal. As I said in another reply somewhere, Facebook is essentially
providing a newsletter service with pages (plus some other stuff). Oh, and
Facebook also has ads on these pages.. Something better will come that doesn't
abuse the relationship.

~~~
mikejsiegel
How is the relationship suppose to be beneficial to Facebook? No one signs up
for Facebook to keep in touch with their favorite brands, they sign up to keep
in touch with friends. Facebook allows brands to communicate to their users
but their added benefit hardly helps FB at all. The only way it does help
Facebook is if they monetize these relationships, which is what Facebook is
attempting to do. I'm not sure there is legit proof that FB has decreased Fan
Page outreach organically (the only way you could claim they're "abusing" the
relationship - I don't see an issue with FB charging brands to reach more fans
non-organically.

Mark Cuban isn't God, I don't think this is a "huge" signal at all. IMO,
Cuban's critiques of YouTube have been similar - which I feel have also been
proven wrong with time.

~~~
loceng
Also, the term organic vs. non-organic -- the posts that reach a person's
feed, organically, is set by the algorithm Facebook determines; It's not so
organic.

~~~
mikejsiegel
Organic in the sense of how it's used in the industry. Google's search
algorithm is set by Google but when talking about the search results people
tend to differ between "organic" and paid.

The difference here is that "organic" is considered Google's and Facebook's
best attempt to show their user what is most relavent to them. Some speculate
that both companies are modifying these results to optimize paid results but
there is no smoking gun that is true.

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the_economist
Businesses run based on numbers. If a Facebook ad converts at a profitable
ROI, then many businesses will buy the ads no matter how poorly they have been
treated.

Users are different. If they feel slighted, they will disappear. Facebook is
right to focus on the user experience at the expense of antagonizing
advertisers.

Whether Facebook could have implemented this without pissing off so many
people, now that is a different story.

~~~
jack-r-abbit
> _Whether Facebook could have implemented this without pissing off so many
> people, now that is a different story._

History seems to indicate that Facebook can NOT change a single thing without
pissing off a lot of people. Every time they do a major update... the
Internets go crazy. I've been guilty of that. I still hate Timeline... but I
haven't left Facebook yet. :)

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Ensorceled
Actually, as a user I'm annoyed by this as well. When I like a page it's
usually because I'm interested in what they have to say.

I _really_ want is control of that myself. Default me to everything and I'll
"show less from this page" or unlike if they are spamming me.

Some companies and organizations are using Facebook to communicate with me and
Facebook is deciding what I'll see or not see.

 _THAT_ is Cuban's real problem. You can't reach _all_ of your audience
without coughing up a fairly large amount of money because Facebook has
decided not everybody wants to see your message.

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jeffwidman
We live in an attention economy, and Facebook is simply the arbiter of it. If
Facebook let all fan pages reach all their fans, it'd be a sub-optimal user
experience.

The fact that they have turned protecting against the tragedy of the commons
into a monetization model may not make brands happy, but it makes users happy.

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zipop
"Mark Cuban, you can afford $0.003 per fan to increase Mavs home game
attendance. C’mon son!"

Telling people what they can afford is not a very well thought out argument.

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magnusr
"As of November 13th, MySpace has approximately 3.8 Monthly Active Users."
Sounds about right.

~~~
brendanib
We're cracking up at the office realizing this typo. Fixed. >_<

~~~
doomslice
Also, this is only the number of people using the Myspace Facebook app, not
the site as a whole.

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zachlipton
I simply don't get why brands view Facebook subscribers as being opted in to
100% of their constant barrage of spam. Facebook pages have never worked like
an email subscription list, and that fact should be obvious to anyone with any
knowledge of the platform.

Someone might follow your brand on Twitter, but if he doesn't check his feed
for a while, he doesn't see your marketing-speak unless he goes looking for
it. Unlike Twitter, Facebook actually tries to be intelligent and show you the
stories you care about instead of defaulting to chronological order only.
Since, shocker of shockers, people generally prefer to engage with their
fellow human beings as compared to these quirky entities we call "brands," the
stories you care about are more likely to involve an old friend getting
married or your buddy's weekend pics than whatever inspirational message your
social medial engagement intern shat out this hour.

Basically, Facebook is treating brands a lot like people: not all their
friends see all their content in their newsfeeds, but some do, and higher
engagement and closer connections make it more likely that someone will see
your stuff. Brands, naturally, don't want to play by the same rules as us mere
mortals and want all of their "content" displayed prominently in their
subscribers' newsfeeds. In other words, it's Citizens United v. FEC all over
again, except no one is actually limiting corporate speech here, just asking
brands to pay rather small amounts if they want more reach and distribution
than the rules allow.

To sum it all up for Mark Cuban: the mere fact that someone has liked the Mavs
on Facebook does not mean that she wants to hear whatever your marketing
interns come up with every couple of hours. The obnoxious guy who talks about
himself all the time doesn't automatically get a free megaphone to beam his
messages into the minds of everybody he's engaged with. I realize that you,
Mr. Cuban, have made a career out of being precisely that guy, and that people
do walk around hanging on your every word, but us normal people and normal
brands have to pay for our promotion, and it's unreasonable to think
otherwise.

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rguillebert
"MySpace has approximately 3.8 Monthly Active Users", you might be
underestimating this :D

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fjabre
Oh goody. I love to rip on the social network.

AOL, Friendster, Myspace, now FB.. They never monetize because the model can't
support itself properly or at least it won't make a trillion dollars like one
might expect to with a billion users. If they really wanted to monetize they
should just go the linkedin route and charge $1/month for it. If you're not
willing to pay that much for FB then what's the service really worth to you?

$38 -> $22 - Need I say more? Zuckerberg reminds me of that guy Steve (Edward
Norton) in the Italian job. Clever as he might be - he's just got no
imagination.

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thomasknoll
I think both positions (Mark's & brendanib) are oversimplifying (and hyping)
the issue. End of the day, what matters are the relationships formed between
people and brands. And like all advertising, paying to get in front of people
is how the game works. If you'd rather pay money to initiate those
conversations, then pay for them If you want to be engaging enough to draw
people into those conversations, then invest in that.

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jfasi
I find it incredibly amusing that a statement by an experienced businessman
who has decided to share some of his hard-earned earned insight into a product
is being treated this way. I'm inclined take the opinion of someone who's got
his mind on his money and his money on his mind more seriously than a blog
post by a social media marketing firm.

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davidwparker
I'm curious as to why more brands don't just use 'groups' instead?

I'm in a couple of groups that are basically companies and I get all their
status updates as well as the ability to turn on or off notifications for them
(one I keep on because I really like the company).

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andrewhillman
When you're used to paying nothing anything more is hardly seen as a bargin.
This is the core issue. It will just take time before brands get used to
paying for what they once got for free.

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ryangripp
Just read this: "Understanding Like-gate"
<http://daltoncaldwell.com/understanding-likegate>

~~~
brendanib
I'm skeptical of App.net, but I thought Dalton did a fantastic job explaining
the News Feed in that piece. Really well done.

~~~
ryangripp
Just as I am skeptical of a post on the pagelever blog from the "Director of
Growth" (Biz Dev). Oh which by-the-way offers a Facebook product...

Content marketing -__-

~~~
jeffwidman
On the one hand, you're completely right.

On the other, who better to say "You just don't understand the power of the
platform" than someone who sees the numbers on over 10,000 Facebook pages with
more than 1Billion Facebook fans?

If Cuban said "I don't understand the platform" that's one thing, but saying
"This platform doesn't work" is claiming it's not an education problem, it's a
platform power problem

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joeblau
Awww man, I thought this article was going to be about Mark Cuban's comments
on the Facebook IPO.

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camus
What the author of the article fails to understand is nothing lasts forever on
the internet.

Facebook can become insignificant 1 year from now just because a new service
propose better features at a lower price, or just because people get bored...

People used to have email accounts at yahoo , yet , people now prefer gmail
because it is easier to use and is less "spammy".

People used to have myspace accounts , and guess what, moved to facebook...

But it's also true that nothing's free on the internet. Twitter is not free ,
neither is facebook , and as a business they need to generate revenue.

~~~
sbjustin
You've missed a couple of points 1\. The possibility that Facebook is
'insignificant' one year from now is astronomical. People use Facebook for so
many things in their lives including staying in touch, single sign on, games,
etc. Even if it somehow cut in half it's still 500m users vs the 3.5m of
Myspace 2\. The 3000 dollar fee is a fee to reach X number of users now, not
one year for now. So if he pays the 3000 now, even if Facebook goes under, it
wasn't a loss.

~~~
camus
never underestimate the web. Someone can come up with a game changing concept
and attention can shift just like that.

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vertr
So an entrepreneur who is building a business based on facebook marketing is
defending facebook. No bias there at all.

~~~
alexpenny
It's in tune with most of the other startup blogs that hit the front page. HN
is a great place for entrepreneurs to lobby for their co's.

~~~
jamesjporter
This is a fair point, but I think its also fair for the parent to point the
potential for bias out, given that some people may have perused the article
quickly without realizing that its posted to the blog of a company with a
large stake in the issue at hand.

