Doubts over Facebook’s Reach Generator
Brands have been reluctant to trial Facebook’s much-trumpeted new “reach generator” ad format, with only a handful of UK companies signing up to use it in the two months since its launch, insiders have told Marketing Week.
Reach Generator guarantees that brands reach 75% of their fans each month with their posts rather than the average 16%.
Brands pay on an on-going basis for the format, which sees their posts automatically distributed by Facebook to fans as a sponsored story on the right-hand side of their homepage or in their news feed on desktop or mobile.
Facebook has heavily promoted the format to brands and agencies via a series of marketers’ conferences in Europe, Asia, the US and South America, including an event in the UK on 28 March.
The slow uptake of the long-term revenue generating format could be worrying to Facebook, which has embarked on a roadshow to attract investors to the company ahead of its forthcoming IPO.
A source close to Facebook told Marketing Week: “Reach Generator is in a bit of a lag phase; people are still trying to get their heads around understanding what that ‘16%’ number actually means. Another factor is the always-on subscription model - it’s expensive.”
He adds that he only knows of two brands that have signed up to use Reach Generator in the UK so far, beyond Facebook’s initial test brands, which included O2.
Many brands and agencies are still waiting for Facebook to prove the value of their posts being seen by more of their fans more often, according to one senior digital expert.
She adds: “Perhaps brands and agencies are becoming more sensitive to the effect on engagement levels [because] it moves the onus from quality of content onto a purely paid direction. Or, that they have already invested in acquiring fans and are less keen to pay again to reach them.”
Robin Grant, global managing director of We Are Social, says Reach Generator is a “blunt instrument” which promotes every post for a monthly fee, which can be seen as inefficient compared to promoting the more important stories.
“Facebook finds itself faced with a media agency landscape that just isn’t geared up to take a conversational approach to marketing - it’s as if media agencies woke up to find that their media plans are based on Newtonian physics in a world where quantum theory reigns,” he adds.
A Facebook spokeswoman did not answer specific questions on brands’ slow uptake of the format, but said: “Reach Generator was launched at fMC (Facebook Marketers Conference) at the end of February and we already have some great examples of this working well for brands.
“This product is most effective when it is used alongside the other tools that Facebook offers. For example, once a brand has built a following and is creating engaging content, then Reach Generator is a great tool to take that to a wider audience.”
O2 was one of the companies cited by Facebook at its London marketing conference as having used Reach Generator effectively. The social network claims O2 has seen a 102% increase in incremental fan reach by using Reach Generator.