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Small Business
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'Owned' vs. 'Earned': Facebook Engagement Leans Toward Paid Ads

If you use Facebook to promote your small business but have been reluctant to pull the trigger on paid ads, soon you may have no choice.

A study conducted by Ogilvy & Mather analyzed the "organic reach" ­of 106 brand pages across a four-month period. Organic reach refers to the likes, shares and deliberate views a page receives that don’t come about by way of paid advertising.

The results were eye opening. Between last October and February, the average organic reach of content posted by those 106 pages plunged from around 12 percent to 6 percent. Pages with more than 500,000 likes fared even worse, generating just about 2 percent of organic reach last month. Both are projected to hit zero soon. [14 Social Media Marketing Solutions for Small Businesses]

"The ability to build communities of fans, and then maintain content and encourage engagement using content published to fans' news feeds was a critical aspect of Facebook's early appeal to marketers," says Marshall Manson, the report’s author and social@ogilvy managing director. Indeed, Facebook rose to prominence within the marketing world precisely because it allowed businesses to tap into a network of users numbering in the hundreds of millions without any associated cost risks. Now, that dream of free advertising has all but vanished.

In the grand scheme of things it's not surprising, given that Facebook has become the market square of every operation from mom-and-pops to multinationals. Standing out from the crowd isn't getting any easier. Couple that with recent changes to the social network's algorithms that are omitting page content from users' news feeds, and it's reasonable to assume many more businesses will be embracing paid ads in the future.

Perhaps that's exactly what Facebook wants.

Regardless, Manson reassures that recommendations and earned engagement from fans are still important. Ultimately, businesses may have to readjust their social media strategies and change their paths to organic reach.

"In summary, the model has shifted. Previously, brands were using 'owned' to fuel 'earned.' Going forward, they’ll need to use 'paid' to fuel 'earned,' but that doesn't make the earned any less valuable."

Originally published on Business News Daily.