KEY TAKEAWAY: According to Mediapost “several Facebook advertisers are pressing to move forward with a class-action complaint accusing the company of duping them by inflating the possible reach of their ads”. Ha?
The latest study from Edison Research finds the number of current users of Facebook continues to drop. The study shows an estimated 15 million fewer users of Facebook than in the 2017 report. The declines are heavily concentrated among younger people. However, in the all-important millennial and boomer categories, Facebook still is holding onto their audience. But let’s talk about metrics..
Facebook is making a ton of money from selling advertising. The price of the ads are negotiated with Facebook and can include impressions, clicks or conversions. Needless to say, impressions are worthless and clicks usually contain a ton of ad fraud.
According to an article in Fast Company, a study of over 4 billion ad requests across over one million domains led cybersecurity firm Cheq to conclude that worldwide $50 billion is being stolen from advertisers annually by online ad fraud.
Fraud researcher Dr. Augustine Fou says that ad fraud may be over $50 billion in the US alone. In a study he conducted, bot detection systems were able to identify less than 3% of actual fraud. 57% of fraud was not bot based and was consequently undetectable by bot detection systems.
The idea that Facebook can inflate ad numbers is absurd. The issue seems to be clueless marketers who believe the hype and are switching ad dollars to digital because they believe TV is dead.
A day of reckoning is coming for Facebook. I hope it comes soon.