Facebook’s ad metric problem is becoming Zuckerberg’s headache
Facebook’s ad metric problem is becoming Zuckerberg’s
headache
By James Covert November 17, 2016 | 1:59am
Mark Zuckerberg has a credibility problem.
The tech mogul’s Facebook just admitted to finding more
“bugs” in the way it measures ads — and once again, those bugs benefited Facebook.
The social-networking giant said Wednesday it has found
numerous errors in the ways it calculates how many people view its ads,
artificially inflating their perceived value to advertisers and publishers.
Key metrics that Facebook has exaggerated include the
weekly and monthly reach of marketers’ posts, which got inflated by 33 percent
and 55 percent, respectively, as the site improperly included repeat visitors
in its figures.
Elsewhere, Facebook admitted to exaggerating the number
of full views that video ads received, as well as time spent by users reading
fast-loading “Instant Articles” for publishers including The Post and the Wall
Street Journal, both of which are owned by News Corp.
Facebook insisted that the messed-up metrics — which followed
the company’s admission in September that it had inflated its reporting of
video viewing times to advertisers by as much as 80 percent — didn’t affect
billing to publishers and advertisers.
Nevertheless, industry insiders said the inflated figures
likely swayed ad-buying decisions as Facebook competed for ad dollars with
everybody from Google’s search engine to struggling newspaper sites.
“It’s not difficult to measure views. It’s not difficult
to measure engagement. It’s not difficult to measure any ad metric,” said Mike
Gamaroff of Sito Mobile, an ad-targeting firm. “For Facebook to over-report
these metrics is pretty inexcusable.”
The disclosures came as Chief Executive Zuckerberg is
taking heat for allowing a barrage of fake news stories to propagate across its
site, a policy some critics say may have tipped the outcome of the presidential
election.
Earlier this month, Facebook shares got slammed after it
told investors it expects a “meaningful” slowdown in ad-revenue growth next
year as it seeks to avoid saturating users’ News Feeds with marketing posts.
To fix the ad-metric mess, Facebook said Wednesday it
will begin allowing third-party firms like comScore and Moat to vet its
viewability data for display-ad campaigns, in addition to video campaigns.
The tech giant also said it is working with TV-ratings
firm Nielsen to count video views, and that it’s forming a “Measurement
Council” of marketers and ad-agency execs to monitor its metrics.
Still, Facebook stopped short of putting all of its ad
measurements up for third-party verification — a stubborn refusal that
continues to undermine trust in its ad data, critics say.
“It certainly doesn’t look good,” said Mitchell Reichgut
of Jun Group, a New York ad firm. “Online advertising has a history of opaque
reporting, and this doesn’t help.”
Facebook, which has more than 4 million advertisers, has
been growing its ad revenue this year at more than three times the rate of the
overall online ad market, according to Cantor Fitzgerald.
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