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Facebook’s latest error shakes advertiser trust

Facebook Co., Ltd.

Hundreds of advertisers after discovering a flaw in a tool that tells advertisers how effective an ad can be, such as downloading an app or buying a product to consumers. We offer $ 10,000 credits.

Facebook’s “conversion lift” tool overestimated the results of the 12-month campaign, the company quietly told advertisers this month. Glitch has distorted the data advertisers use to determine how much they spend on their company.

It’s not the first problem Facebook has found in the system to measure advertiser campaigns, and it’s unlikely to squeeze Facebook’s advertising revenue. However, for some ad buyers, the latest gaffes undermine confidence in company metrics as many companies overcome the pandemic by trying to cut costs and ensure that they pay for their ads. Said that.

Omnicom Group Co., Ltd.

Media agency OMD Worldwide is investigating how the error affected the investment of some clients before accepting credits, said Florian Adamski, OMD’s global chief executive officer. I am.

“This is not an easy fix,” he said. “That’s not the case, paying thousands or millions of dollars, it’s over. This goes deeper and you need to find a way to fix the damage done and prevent it from happening again. . “

“Without governance or a third-neutral party considering our investment tools, I can’t sleep well at night and my clients can’t sleep,” he added.

This issue is especially serious in certain categories, such as retail, where marketers spend 5% to 10% more on Facebook and other performance-centric advertising channels to recover businesses lost in the early stages of the pandemic. is.A digital agency that spends hundreds of millions of dollars on Facebook each year

“It’s very important for now to be able to identify where the sales come from,” said an executive. “Every dollar you spend needs to be remapped to datapoints and performance. If you can’t undo it, justify your spending when your clients are trying to manage costs as effectively as possible. It’s going to be harder to do. Media spending is the cost of generating revenue. “

Facebook credits will be offered from August 2019 to August 2020 to some advertisers who used the tool when no errors were detected.

“While improving our measurement product, we discovered a technical issue affecting some conversion lift tests,” a Facebook spokeswoman said in an email. “We’ve fixed this and are working with advertisers who have influenced the survey.”

According to a note sent to customers by an agency obtained by The Wall Street Journal, at one major buyer, the size of advertising credits is about 0.5% of the customer’s annual budget affected before and after the glitch.

“This error can be much more serious than past measurement issues on Facebook’s advertising platform,” the agency wrote in a note to its clients. “The fact that it led to a systematic exaggeration of advertising performance, coupled with the one-year period of error, could have given false information about media budget allocations. These misallocations could have given advertisers misallocation. It came at the expense of both media efficiency and Facebook’s competitors. “

Facebook told advertisers this month that it fixed the error in September, according to a note Facebook sent to its clients. The company bases its analysis on the amount of credit it issues to advertisers to show how much the error affected the actual investment during the post-lift survey period.

Some ad buyers are also questioning the analytics Facebook uses to determine advertiser rewards. It criticizes the tech giant for lack of transparency in how to determine who will receive advertising credits, how to calculate rewards accurately, and the details of Facebook’s procedures. This is taken to prevent such an error from occurring again.

“This cannot be covered by a one-time compensation for credits,” said Adamski of OMD. “We need to coordinate all our clients on how they influenced the investment decisions we made.”

Despite the incident, marketers are unlikely to leave Facebook, said Kevin Simonson, social vice president of digital marketing agency Wpromote LLC, which spends more than $ 100 million annually on Facebook advertising on behalf of clients. ..

“This particular error affects our strategy on which creatives to use and which audiences to compete with. This can be important to some extent, but not enough to cause a brand (of this era). No, don’t do Facebook, “Simonson said in an email. “How much is it?”

Glitch news was reported last week by the trade magazine AdExchanger.

Write to Alexandra Bruell (alexandra.bruell@wsj.com) and Sahil Patel (sahil.patel@wsj.com)

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Facebook’s latest error shakes advertiser trust

Source link Facebook’s latest error shakes advertiser trust

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