Here's How Facebook Punishes Clients It Doesn't Like

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Photo: Ha-Wee / Flickr, CC

We noted recently that Facebook’s list of newly approved “Strategic Preferred Marketing Developers (SPMD)” — client companies and agencies who qualify for early participation in beta ad products and other advanced looks at cool new stuff — contained some apparent omissions.Some of Facebook’s most prominent clients weren’t on it.

No one we talked to wanted to go on the record about this topic. But privately, executives familiar with Facebook’s ad business confirmed that the social network does indeed play favourites with its ad clients, alternately rewarding or punishing those it does or doesn’t like.

To put this in context, in the media business, it’s common for sellers to be extremely solicitous to their advertising clients. Dinners, drinks, and free tickets to sporting and arts events for buyers are the norm.

Facebook, however, has an awkward history of occasionally treating its clients with disdain. There was a time when it was difficult for agencies to get their calls returned at Facebook.

More recently, Facebook held a summit where agencies aired their grievances about dealing with the company.

Generally, Facebook vice president of global marketing solutions Carolyn Everson has steered the company toward a policy of being more accommodating to the ad agencies and buyers who, after all, provide about 90 per cent of the company’s revenues. (Facebook declined to comment).

A source close to Facebook, however, said the reason the company requires its clients to adhere to its strict guidelines is to ensure that buyers are as well aligned as possible with Facebook so that campaigns get the best performance possible. Executives at Facebook have seen agencies put out press releases claiming they can use Facebook in ways “that are literally not possible,” this source says. Facebook doesn’t want clients to say “Facebook didn’t work for us” when those campaigns inevitably fail. So the company tries to keep its agency clients on the same page.

Not all vendors get treated equally.
The new SPMD announcement was held with much fanfare at an event hosted by Saleforce’s new Dreamforce unit (formerly Buddy Media), by Facebook’s David Fischer, vp/advertising and global operations. It’s not surprising that Vitrue, a competing company owned by Oracle, wasn’t there — or even on the SPMD list. Nor was Syncapse, which also provides enterprise software for CRM and sales executives who use Facebook as a marketing tool. And nor was TBG Digital, which is one of Facebook’s biggest ad buyers.

Wildfire didn’t make the list either. (It’s now owned by Google, which competes with Facebook for ad dollars.)

Why the differing treatment? Here’s what we heard from our sources:

  • “They’ve got to keep people in line. They reward people who do good stuff and they punish people who do bad shit.”
  • “You toe the line or they exclude you, basically.”

Strange bedfellows
One notable company on the list is Glow. It has just eight employees, according to Crunchbase and only four according to LinkedIn. We’re sure it’s a great company, but it’s on the same list as Adobe, the global colossus of software-as-a-service selling.

Similarly, Nanigans also made the list. Nanigans is one of Facebook’s most prominent partners, but it’s also one of the most skittish, and it guards its relationship with Facebook preciously. When Facebook allowed partners in its FBX ad exchange program to talk to the media about the kind of ROI results they were getting, many of the FBX participants raved about it. Triggit, for instance, shared data on two different clients, including the multiple on their investment that they got relative to other buys. But Nanigans published only a press release announcing its “support” for FBX.

There is nothing wrong with any of this, of course. And we’re definitely not suggesting that any of the companies in this article have fallen afoul of Facebook.

It’s simply unusual to see a situation in the ad business in which the people giving a seller money are the ones who live in fear of it, and not the other way around.

Disclosure: The author owns Facebook stock.


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