Any business that advertises on Facebook wants eyes looking at its ads and then fingers clicking on them. Facebook gets paid based on how many clicks that ad receives – effectively, on how many users it can send to a particular brand.
On Monday came an explosive claim that could give pause to brands trying to figure out if advertising works on Facebook. A Long Island start-up company said it was pulling its ads from the social network because it discovered that its ad clicks were far more likely to be coming from Web robots – or bots, as they are known — than human Facebook users.
The company, called Limited Run, helps bands and record labels sell music and merchandise online. It bought advertisements for itself on Facebook this spring. It wanted to know who was clicking, so it built its own analytics tool. It discovered that only one in five clicks seemed to be from human beings. The rest, it said, came from bots, which, in essence, are bits of software performing automated tasks.
The claim resurrects an issue that the social network has faced before – the scourge of bot farms – but it comes at a particularly inopportune time, when Facebook, now that it is a public company, is trying to increase advertising revenue to assuage shareholders. One of its nagging challenges is to prove to advertisers, big and small, that Facebook advertising yields results. News of robots doesn’t help.
Facebook has said that 5 to 6 percent of its nearly one billion users could be fake, and it scours the site regularly to get rid of them. The company did not immediately respond to a query about the Limited Run accusations.
Debra Williamson, an analyst with the market research firm eMarketer, says bots and spammers are an unfortunate byproduct of Web advertising. “Most advertisers should use additional analytics to determine more information about who is actually responding to their ads,” she said. “Many advertising technology companies that place ads on Facebook offer these kinds of services. As businesses get smarter about targeting and bidding on ads on Facebook, the likelihood that they will get bogus ad clicks will diminish.”
Dennis Yu, chief executive of BlitzMetrics, which develops and crunches the numbers for Facebook advertisers, says he often sees less than a 10 percentage point difference between the clicks that an ad actually gets and what Facebook reports.
Tom Mango, a co-founder of Limited Run, said Monday that he had devoted his modest advertising budget to Facebook and that the revelation of bogus ad clicks were enough to get him to suspend it for now.
“If we’re going to spend money on advertising, we want to make sure people are looking at us,” he said. “If a bot visits us through a Facebook ad, that costs us money. That ends up being not worth it to us.”
He said he had no idea who had created the bots, and he took pains to say he wasn’t blaming Facebook.
“Do we know who the bots belong too? No,” the company wrote on its blog. “Are we accusing Facebook of using bots to drive up advertising revenue. No. Is it strange? Yes.”
Limited Run seems to have had another gripe with Facebook. It changed its company name – it called itself Limited Pressing in the past – but faced difficulties in changing the name on its Facebook brand page. The one big upside for the company was this: Since Monday’s blog post, its followers on Facebook have doubled to 800 people.
Mr. Mango is now weighing whether the company should spend its advertising budget on Twitter.