Studios Moan That Facebook's New Anti-Spam Algorithm Is Killing Movie Advertising

Movie studios are questioning the effectiveness of the ad budgets they spend on Facebook, according to the LA Times.

Well, kinda.

The story quotes only one studio executive on the record — Dwight Caines, president of worldwide digital marketing at Sony Pictures Entertainment — and he gives Facebook a thumbs-up: "Facebook continues to be an important advertising partner ... They are on every campaign we do today."

The negativity comes from a movie marketing consultant and "other film executives [who] confide privately they are considering cutting their spending on Facebook ads."

Their beef is with the newly notorious algorithm that Facebook uses to prevent advertisers from clogging up your news feed with spam status updates. Some call it Edgerank, although that's not the name Facebook uses internally. The algorithm was changed last year to ensure that any given post by a brand reaches only about 15 percent of the brand's fanbase. If brands want to reach more than that they must either pay for promoted posts or write posts that are so interesting they will go viral on their own.

Facebook is forcing advertisers to be interesting, in other words.

And movie studios hate it, according to the LAT:

For example, 72% of movies and network TV shows experienced a drop in the number of people who saw new Facebook posts after the new algorithm launched, according to BlitzMetrics, a Facebook marketing firm that analyzed 9 billion page posts generated over a 60-day period before and after the change.

That decline took a toll on two factors marketers watch closely: reach and engagement.

Twenty-three percent of the biggest studio pages saw a reduction in "engaged" users — people who click on a post, share it with friends or write a comment — because of decreased exposure in the News Feed, BlitzMetrics found. The drop in "reach" — the number of people who saw these updates from the most popular film and TV sites — was even sharper: 45%. The change in the algorithm coincided with a push from Facebook to get studios to buy ads in the News Feed.

Movie studios have absolutely no excuse, of course. They make movies — a product that consumers remain genuinely excited to hear news about. If a studio is failing to write posts that its movie fans aren't interested in, then they have only themselves to blame. (Paramount's Star Trek Into Darkness page is a case in point — it's lousy with press releases and non-compelling content. It doesn't even show the trailer, even though that is available on iTunes.)

Facebook, on the other hand, does have a PR problem with some advertisers over Edgerank:

• Mark Cuban has railed against Edgerank.
• George Takei doesn't like it either.
• Charity Engine, a British startup, has been vocal about the way Facebook encouraged marketers to build assets for free and then restricted the reach of those assets.
• And in October, Facebook was forced to deny it was "gaming" the news feed against advertisers.

Up next: whether Facebook will stick to its guns, take some hits, and forces page owners to become more interesting. Or whether it will whither in the face of complaints from some of its biggest clients and allow them to post what they want, to whomever they want.

Facebook has made once concession already, creating a Pages Feed where fans can see every message posted by any brand they follow. The question is, will that be enough?