Bait and switch? Facebook now wants companies to pay to be seen

The headline in TIME says it all: “The Free-Marketing Gravy Train Is Over on Facebook.”

TIME reports that “Facebook has been reducing the organic reach of Pages. A recent study found that companies’ posts dropped from reaching 12% of their followers in October to just 6% in February.”

Facebook has done a great job of winning over brands that have made the social giant a huge part of their corporate marketing efforts. They run Facebook specials, they offer coupons exclusively through Facebook and they advertise their Facebook pages.

“Some companies have abandoned their own websites in favor of Facebook and others often promote their Facebook page more than their own websites,” says Glenn Selig, president and CEO of Selig Multimedia, Inc., which owns and operates a global PR firm and press release newswire PR NewsChannel, among other properties. “Many, many companies bought into Facebook without thinking it through and now that marketing strategy will cost them.”

The Ogilvy & Mather study found that the visibility of companies’ organic posts have been dramatically dropping: from reaching 12% of their followers in October to just 6% by February.

Tech blogs are having a field day on this news.

“Facebook pulled the best practical joke of the internet age: the company convinced countless celebrities, bands, and “brands” that its service was the best way to reach people with eyeballs and money. Maybe it is! But now that companies have taken the bait, Facebook is holding the whole operation hostage,” writes VALLEYWAG.

VALLEYWAG quotes a source who says that Facebook is now in the process of dropping the organic reach of pages down to 1-2% “meaning an advertising giant like Nike, which has spent a great deal of internet effort collecting over 16 million Facebook likes, would only be able to affect of around a 160,000 of them when it pushes out a post.”

What’s clear to experts all over is that for brands everywhere, the game has already begun to change.

“Facebook has made it abundantly clear that the free lunch of unpaid social media marketing using their service has come to an end; this ‘strategy pivot’ is punishing brand Pages repeatedly until they pay to reach their audiences,” Christopher Penn, Vice President of Marketing Technology for SHIFT Communications writes on the company blog.

Penn says it appears that Facebook will charge brands based on the number of Likes a page has.

“The more Likes your page has, the more you’ll have to pay per post, costing about a penny per two Likes to reach your entire audience,” says Penn.

Penn created a nifty calculator to help brands figure out their costs.

So how much will your company be forced to pay Facebook for something it had been paying nothing for?

Pizza Fusion in Tampa, for example, has 3,607 Likes on its Facebook page.

Using Penn’s calculator, to have just one post seen by all of its audience will cost $18.04 a day, and Pizza Fusion should plan to spend more than $5,000 for the remainder of the year on Facebook Promoted Posts.

Of course, Pizza Fusion does not have to do anything. But then it’s also likely no one will ever see anything the eatery posts.

Experts say it’s all the more reason to make sure you only have the audience you want Liking your page because you’ll be paying for the dead weight.

“We’ve always said it’s better to have 100 people who care than 10,000 who have no idea why they’ve Liked you,” says Tyler Ragghianti from The PR Institute. “This underscores that point and all those brands that have been going for quantity over quality are going to feel the pain.”