Commentary

No Matter What, Big Tech Has Small Business In Its Grip

Days before the beginning of the new year, the head of Instagram, Adam Mosseri, announced that the platform would be “doubling down” on the importance of video -- specifically on Reels, a short-form video feed that both Instagram and its parent company, Meta, adapted from the world’s third most popular social network, TikTok.

Mosseri’s announcement didn’t shock me: Copying TikTok, the rising king of short-form video, seemed like a classic business move. But for some users relying on Instagram for brand awareness and as their main source of income, this shift has proved devastating.

On Tuesday, The New York Times published a story about the ways in which Instagram’s algorithm, which now prioritizes videos over photos in attempts to boost Reels, has directly impacted sales of small food businesses.

Sana Javeri Kadri spoke with  the Times about her spice company, Diaspora Company. With 100,000 followers on Instagram, Javeri Kadri was used to receiving 2,000 to 3,000 likes on posts depicting a food photo and “a thoughtful caption.” But since the algorithm changed, she sees between 200 to 300 likes per post.

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Javeri Kadri’s original strategy of sharing photos and writing captions, which ultimately boosted her business, proved to be a low-cost form of advertising. She never felt the need to pay for ads on Instagram, but that has since changed.

The Times highlights several other small food businesses whose sales and business strategies have been negatively affected by the algorithm change.

“You have to fight harder than ever to get out there and get seen,”  Skyler Mapes, founder of Exau Olive Oil, told the  Times.

And in terms of adopting video-editing abilities, Abigail Knoff, marketing director at mushroom company Smallhold, said, “We can occasionally work with freelancers who are, rightfully so, higher cost, or be patient as we learn these new skills on the job.”

Others being forced to pivot their business strategies said they had switched from Instagram to TikTok, where some of their video content quickly went viral. Profits, however, remain low as the app doesn’t contain integrated shopping features or links, as Instagram does.

Finally, Mapes said that “these platforms don’t belong to us, they belong to tech companies.”

This quote, specifically, hints at a bigger picture surrounding small businesses’ contentious relationships with Big Tech.

Soon before Meta and Instagram shifted the focus of their algorithm to video, a national network of small business coalitions called Main Street Alliance (MSA) began a campaign calling out Big Tech for its treatment of small businesses.

MSA said that instead of aiding small businesses, Big Tech exploits them by providing misleading and unreliable data, imposing hidden costs, designing confusing interfaces, and making sudden changes to their rules and algorithms, as well as providing inadequate customer service.

Furthermore, it seems that small, innovative companies are too-often devoured by Meta, Google, Amazon, and Apple -- a predatory process known as “The Amazon Effect” -- and have consistently been used as Big Tech’s excuse to fight against antitrust reforms, saying new laws could disproportionately harm small businesses’ successes.

It’s certainly possible that Meta and Instagram’s prioritization of video is helping specific brands with a video-focused skill set and advertising strategy. But whether or not it helps some and hurts others, it becomes clear that Big Tech largely controls the outcome. 

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