Meta-advertisers claim that the cost of running campaigns across their platforms has increased due to ongoing issues with their algorithm.
Brands report that sales and return on ad spend have plummeted, while cost per click and cost per 1,000 impressions have tripled in recent months, with no explanation from Meta.
Why we care If the reported ongoing algorithm issues continue to affect ad performance, marketers will need to take steps to cut costs by exploring rival platforms like Google and TikTok.
Details. Meta is a global leader in digital advertising with its platforms accounting for approximately 22% of the market, according to Emarketer. Small businesses in particular have traditionally relied on Meta to reach their target audience thanks to the efficiency of its AI-based targeting technology. However, many advertisers claim that the social media giant’s reliable advertising system is experiencing significant problems, prompting some to reallocate their budgets to rival platforms.
impact The potential impact of this reported system issue on ad revenue is expected to become apparent later this month, when Meta releases its first-quarter earnings. Experts expect Meta to report $36.1 billion in ad revenue.
reaction. Cody Plofker, director of marketing for the Jones Road Beauty brand, said on the “Operators” podcast:
“It’s brutal out there. There’s something terribly broken about Meta right now.”
What Meta says. Meta admitted that there have been some technical issues affecting the ads, but denied that the problems were widespread. a spokesman said Bloomberg:
“Our ad system works as expected for the vast majority of advertisers.” “We’ve recently fixed some technical issues and are investigating a small amount of additional reports from advertisers to ensure the best possible results for businesses using our apps.”
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deep dive. Read our coverage of the $7 billion class action lawsuit Facebook and Instagram advertisers filed against Meta for more.
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