Opportunities for publishers to seize the initiative as Facebook abandons news
Was anyone really surprised?
Since its IPO in 2012 Facebook has focused on delivering shareholder value with 3yr EBIT CAGR1 of 64.3%2, its stock price rising $38 to $1793 and earning up to $21.20 ARPU4.
To maintain growth, the Company pivoted on audience growth and ARPU. When audience growth plateaued in 2015 it reduced (free) organic reach and tactical content revenue-sharing deals to boost APRU. More of the same is expected.
Impact on publishers
Organic reach has dropped as low as 4% in 20175, with brands experiencing similar drops in interactions. MailOnline, a stellar social performer, was typical with social engagement dropping >50% in 12 months from 24.3m to 12.1m by the end of 20176.
Engagement fell across three of the UK’s leading publishers
3 actions for publishers to consider today?
1. Reduce uncertainty
Shifting dependencies, such as reach and content revenue-sharing, make investments in new social business models difficult. Plunging (free) organic reach has been particularly punishing for social publishers who have absorbed the decline in CPMs, further amplified by the absence of audience data.
2. Evaluate Direct to Consumer
Many brands are evaluating direct to consumer (DTC), with the view to becoming social entities in their own right, reducing current dependency. Synchronised with social media, brands may operate a new genre of diversified live social models on demand, returning control, revenues, and data, giving the opportunity to deepen brand partnerships.
Vice Media has already announced their strategy to move towards DTC to be ‘nimble, smart and fast moving’ and are amongst first of a new genre of online publishers to reduce dependency on social network distribution.7
3. Become data-focused
DTC enables publishers to reacquire live social audience data, to deeply segment and understand their audiences. CPMs increased by 171%8 in 2017 making Facebook dependency more expensive for brands and making segmented publisher audiences more attractive.
Fork in the road for publishers
There are opportunities for publishers to succeed in this new era of social, but it’s up to the brands themselves to decide how they take advantage of it.
While social network reach will remain to those who pay up, the real opportunities for brands will be to diversify business models and go DTC.
 EBIT (Earning before interest and tax) CAGR (Compound annual growth rate)
 Jan 2018
 15th January 2018 NASDAQ close.
 Average revenue per user
 Social@Ogilvy, 2017
 Daily Mail, 2018
 June 2017
 Adstage 2017