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Rats! Facebook Is In Trouble (July 2018)

|About: Facebook (FB), Includes: T

$FB is in trouble with their Ad clients.

Now they feel they need a slick, glossy magazine to send to Ad buyers.

I work with some folks that spend big and we are not getting the same results we once did with $FB advertising

When we confront $FB we are told via form email that our ad's are doing better then 95% of others in similar category.

Our own tracking data disputes this.We are talking Jay Abraham level tracking metrics, on point.

So a client of mine goes out and hires a "$FB ad specialist" and that project falls flat, hard. He calls me to let me know about this project and says "Well, I guess it wasn't just you."

Maybe it is just me, maybe it is just that particular $FB Ad specialist dude, but I can tell you this, that magazine that $FB will want to send me will be burned slowly over a glowing embers with incantations uttered quietly and powerfully.

Would also like to add that reason they need a magazine is a lot of ad people have cancelled their Facebook accounts, or do not check their accounts as regularly as they once may have. Or never had an account, like me.

Facebook emails are generally recognized as SPAM and/or most are never read by people.

Texting or calling could be illegal if folks are on the National Do Not Call Registry.

It is hard to reach people who TiVo through ads, time shift recording everything on television, which is why $T is so brilliant here as they are going to drastically reduce Ad inventory and use targeting to increase per ad revenue. People will accept a reduced Ad load for premium content and $T feels they have pretty much dialed that in.

So how to reach people if you no longer control their phone via the Facebook App?

I guess their consensus is a magazine.

So my contention is they ($FB) are having the same problems everyone is, even Seeking Alpha.

How do you get eyeballs on screens?


$FB ad performance has deteriorated for several reasons.

Many people have cancelled their accounts or no longer check Facebook as frequently as they once did.

Many of the techniques $FB used extremely violated privacy and may not be legal in the future, and if any indication of Zuck at the Senate hearings showed is there may be political will for legislation that would further erode the Reach that $FB once enjoyed. $FB does not want this of course.

All of the smaller Ad buyers paying for Reach on the $FB platform are now being conditioned much the same way that a larger rat must let a smaller rat win 30% of the time or the smaller rat won't play.

When two rats fight it's not always the biggest rat that wins. The biggest rat could win pretty much 100 percent of the time, if it wanted to. But that doesn't happen. If the bigger rat chooses to win all the fights, then there will be no more playing. This fighting is a form of playing. The bigger rat needs to let the smaller rat win at least 30 percent of the time. It's the smaller rat that asks the bigger rat for a fight or a match.If it doesn't win at least 3 out of 10 matches, it will stop asking for matches. So the fun is over for both of them.

So the Reach we once had on $FB is metered out using variable reinforcement like a slot machine so that you will keep playing, because they can't give you the keys to kingdom anymore cheaply because everyone will quit Facebook if they do, and the techniques they used may be illegal in the future.

None of the rats will play anymore if their are too many ads on the $FB platform. None of the rats buying ads will play anymore if they don't occasionally get cheese (eyeballs).

Variable reinforcement is a hell of a drug.

Believe it or not I am Long $FB, I am a share owner.

I am enthusiastically Long $T.

Disclosure: I am/we are long T, FB.

Additional disclosure: Do not even read this article. I am a trained amateur driving on a closed track.
None of this is advice or will even ever be read by humans, it is solely for the Artificial Intelligence that will be mining Seeking Alpha for the last reminent shreds of humanity.