Likegate 2012: Controversy Brews Over Facebook’s Ad Practices

Likegate 2012: Controversy Brews Over Facebook’s Ad Practices

Billionaire philanthropist Mark Cuban is upset with Facebook. The owner of the Dallas Mavericks recently posted on his blog:

I am recommending that we de-emphasize pushing consumers or partners to like us on FB and focus on building up our followings across all existing social media platforms and to evaluate those that we feel can grow a material following. In the past we put FB first, twitter second. FB has been moved to the bottom of a longer list.

Why? According to Cuban, “Defining engagement by clicks, likes, shares, unlikes and reporting works for Google’s search engine, I don’t believe it works for a social network.”

Cuban’s comments touch upon a deeper controversy brewing among businesses on Facebook. The social network uses an algorithm to control which posts show up in the newsfeed of a brand’s Facebook friends and fans. But Facebook also allows brands to override the newsfeed algorithm to give updates more prominence – for a pretty penny, of course.

Google VP Bradley Horowitz (who called this whole mess “Like-gate”) shared his opinion on Facebook’s ad monetization during an interview with Wired magazine.

When I’m having a conversation with my daughter, if a man with a sandwich board came and ran between us and danced around, that’s a bad experience. It interrupts my connection to my daughter. And yet that’s the way that many of the social networks are monetizing. They’re basically injecting the monetization agenda into the least appropriate, least useful, most intimate moments when I’m trying to look another human in the eyes and create a connection of the heart…. We don’t have to do that.

How bad has Likegate gotten? Based on this chart by PageLever, a Facebook analytics company, the bigger your Facebook fanbase, the fewer people your individual posts reach (unless you pay) – and big brands feel that Facebook isn’t playing fair.

The temporary solution: spread your engagement strategy over multiple social networks, and maintain an active presence across the board (Horowitz encourages businesses to bring their attention to Google+, which abandons ad-based brand engagement). What are your thoughts? Is Facebook the biggest part of your social media strategy? Is the social network a blessing or a curse? Let us know in the comments.

Scott Kaufmann
[email protected]

Scott is Partner at Lucid Agency and a lover of all things technology, marketing, investing and entrepreneurship. Scott volunteers on the board of the Denver-based Nonprofit Celebrate EDU and as a mentor for SeedSpot (a Phoenix-based social startup incubator).

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