A small hosted e-commerce store company says it is giving up on Facebook because a large majority of ad clicks are coming from bots and the popular social network is now allegedly holding their page name hostage. Their accusations, posted yesterday to their Facebook Page, set off a firestorm in the technology sphere.
Facebook Accused of Demanding Ad Spend to Release Page Name
E-commerce store builders Limited Pressing alleges that Facebook is holding the name they want for their Page hostage. The post reads:
While we were testing Facebook ads, we were also trying to get Facebook to let us change our name, because we're not Limited Pressing anymore. We contacted them on many occasions about this. Finally, we got a call from someone at Facebook. They said they would allow us to change our name. NICE! But only if we agreed to spend $2000 or more in advertising a month. That's correct. Facebook was holding our name hostage.
“We're currently investigating their claims," a Facebook spokesperson told Search Engine Watch. "For their issue with the Page name change, there seems to be some sort of miscommunication. We do not charge Pages to have their names changed. Our team is reaching out about this now.”
The spokesperson explains, “For Page name change requests, we ask that many requests be routed through our team to prevent confusion from users. For example, we don't want people finding that a Page they liked changed its name to something completely unrelated to the original Page name.”
A cursory search shows that the Page name Limited Pressing is seeking, Limited Run, is already taken and has been occupied and active by a running magazine since October 25, 2010. Miscommunication, indeed. Even for a fee, the Page name is not available.
As there is no audio recording of the telephone call said to have transpired, we will never really know what might have been said between a Facebook employee and the Limited Pressing representative.
Limited Pressing Alleges 80% of Ad Clicks Are Bots
Limited Pressing claims to have determined over a one-month testing period that 80 percent of their Facebook ad clicks were performed by bots. While their initial announcement hedges around actually accusing Facebook of running the bots, the message is clear: Facebook’s ad platform has a big click fraud problem.
In their post, Limited Pressing wrote, “...we tried contacting Facebook about this. Unfortunately, they wouldn't reply. Do we know who the bots belong too? No. Are we accusing Facebook of using bots to drive up advertising revenue. No. Is it strange? Yes. But let's move on, because who the bots belong to isn't provable.”
In describing the problem and how they identified the traffic as bots, Limited Pressing wrote:
A couple months ago, when we were preparing to launch the new Limited Run, we started to experiment with Facebook ads. Unfortunately, while testing their ad system, we noticed some very strange things. Facebook was charging us for clicks, yet we could only verify about 20% of them actually showing up on our site.
So we did what any good developers would do. We built a page logger. Any time a page was loaded, we'd keep track of it. You know what we found? The 80% of clicks we were paying for were from bots. That's correct. Bots were loading pages and driving up our advertising costs.
Data to Support Accusation Unavailable, Facebook Reiterates Click Fraud Policies
Search Engine Watch asked Tom Mango from Limited Pressing to share data or evidence from their month-long period of testing to verify their findings, but nothing is available at this point.
“I don't have any additional details right now," Mango said. "We do plan to post more about how we came to this conclusion, but honestly, we had no idea anyone outside of our followers would know or care about this whole thing, so we were really caught off guard.”
We will be sure to follow up if any information to support the accusations is forthcoming.
Facebook told us that since people can only see ads when logged into Facebook, it would be difficult for someone to create a series of fake accounts to click on ads.
“If we find fake accounts, we disable them immediately,” a spokesperson said.
Facebook has systems in place that attempt to detect and filter certain click activity, including repetitive clicks from a single user, clicks that appear to be from an automated program or bot, or clicks that are otherwise abusive, their spokesperson said.
In their Q2 2012 Earnings call, Facebook answered a caller question about click fraud. The Facebook representative said they are continually making efforts to reduce fraudulent activity and fake accounts by becoming better at detecting duplicate accounts. They also shared the information that more offenders come from Turkey and Indonesia than any other countries.
On a macro level, Facebook now has independent ROI data from more than 60 advertising campaigns using a variety of third-party methodologies like panels and marketing mix models. The results show that 70 percent of campaigns resulted in a return on ad spend of 3x or better, and 49 percent of campaigns showed a return on ad spend of 5x or better.
The Real Problem with Facebook Ads
I said it a few weeks ago, and I’ll say it again: The biggest problem with Facebook Ads are the people using them incorrectly. Half-hearted “investigations” from the BBC, the pre-IPO announcement from GM, unverified accusations, and limited experience anecdotes all feed on the media frenzy around Facebook’s IPO but contain little substance.
Facebook COO Sheryl Sandberg told investors on the earnings call, “Advertising on Facebook is complicated and that's mainly because we're a completely new type of marketing. The messages that talk ‘at’ consumers in other mediums like TV or search need to be fine tuned for our platform.”
Translation: If you’re porting your Google AdWords ads over to Facebook and not taking advantage of the unique features the platform offers, your experience may not be optimal.
“Also, attribution is an issue." Sandberg noted. "Marketers need to tie sales back to multiple touches; they may see on Facebook and search later. Our ads work and the ROI is there, so we're focusing on education.”
To that end, Facebook has an extensive Ads Help Center accessible from the ads building platform. They also offer individual case studies highlighting the successes of small businesses, which marketers can use to replicate good results.
The moral of the story is, believe half of what you see and none of what is thrown into the mix on a controversial, high visibility topic without verification. Until the companies accusing Facebook of some kind of advertising shakedown start publishing their complete campaign data, it’s just spin and hype.
For their part, Facebook is putting verifiable information out there, though they have an uphill challenge getting it heard over the din of doomsday predictions from bloodthirsty Wall Street analysts and armchair tech watchers.
What do you think of this latest Facebook Ads debacle? Weigh in with your comments.