When Does The Facebook Piggy Bank Fill Up?

I am sure you join me in feeling just terrible for Facebook because its second-quarter ad revenue increased by a mere 47% year-over-year to $9.16 billion.

But a byproduct of that measly number is that the company is running out of places to put ads. It used to be that your newsfeed was full of well, news and posts from those you follow. Now it is increasingly full of ads -- or "sponsored posts," if that is any more digestible for you.

Because they have seen it happen elsewhere, the fine folks at Facebook know that soon they will hit that delicate inflection point where users, annoyed by too may ads, will simply stop accessing Facebook as often, further shrinking the ad inventory pool.

It has been rumored that hundreds of ad-tech vendors and publishers have ordered their families to stay off the platform, hoping that if they can shift just a few percentage points of spending away from Facebook, they will show enough growth to get that red herring back on track.

In its mission to bump up its co-share with Google of global digital ad spend to 50% of every dollar, Facebook has already begun testing ads slotted in the middle of videos. Not that pre-rolls aren't annoying enough, but these new ones are interruptive ads that probably can't be skipped after a few ticks. And if these ads don't piss off enough users, Facebook will probably start to bank them together like linear TV so that watching a three-minute music video will soon take 17 minutes.

I hope the folks at Eyeo GmbH are working on a DVD for YouTube so that we can fast-forward past the pending invasion.

Not satisfied, I guess, with nearly 50% revenue growth, Facebook is also planning ads in Messenger and WhatsApp. For now, we assume these ads will only appear somewhere in the app interfaces and you won't get a text from your kid saying "I'll be home by 6:30. You should get a new set of tires on sale now at TownFair." But perhaps that's only a matter of time and greed.

Inevitable in this trajectory will be the offer of ad-free versions of Facebook that will undoubtedly be sold on an annual subscription basis for a fee that will go in only one direction: up.

You would think that Zuckerberg, with a net worth quickly approaching $70 billion, would kind of kick back and think of ways to deploy his (and Facebook's) vast fortunes to make the world a better place -- rather than staying up nights trying to calculate new ways to squeeze the last nth of value out of advertisers and users.

Yeah, yeah, I get shareholder obligation. But after a while, this relentless pursuit of trying to monetize consumer engagement in every possible way tips over from smart strategy to egregious exploitation.

Maybe when his net worth hits $100 billion?

1 comment about "When Does The Facebook Piggy Bank Fill Up?".
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  1. John Grono from GAP Research, July 28, 2017 at 8:42 p.m.

    George, the Facebook piggy bank fills up only during daytime and nightime hours on days that end in the letter 'Y'.

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