Hollywood Realizing That Facebook Likes Don’t Result In Box-Office Bonanzas

Once upon a time there was this terrific free promotion site called Facebook. FB users were happy. FB marketers were happy. FB execs were – or at least seemed – happy.

Then Facebook did its IPO thing and changed its policies, resulting in nobody being happy. If that isn’t a true reflection of the problem with our current business paradigm, then what is?

For example:

jackreachergrabby Chris Morran (Consumerist.Com)

For years, Hollywood studios have been tossing piles of cash at Facebook in the hopes that getting people to “like” a movie or TV show would somehow translate into box-office returns or high ratings. But some studio executives are reportedly wondering if this might be a waste of money.

“For people who are actually looking at the research and are looking for return on investment, for metrics that indicate specifically what Facebook’s role is in the movie marketing equation, the jury’s still out,” one movie marketing consultant — and former head of marketing for Walt Disney Studios —tells the Los Angeles Times.

A major part of the problem, says the Times is that all those pages that the studios have been setting up for free to promote their products are now no longer reaching as many people because of a recent algorithm change that keeps a lot of posts by “liked” pages away from the top of many users’ news feeds. Research shows that 72% of pages for movies and TV shows saw a decline in views for their Facebook posts following this change.

“The days of free traffic are over,” Dennis Yu, founder of BlitzMetrics, tells the Times. “Facebook has been trying to educate marketers on how to be social — to post the most engaging content — so as not to be penalized by their algorithms.”

And, though the Times doesn’t mention this, it’s worth noting that while Facebook might not have charged studios to set up a page for every new movie or show, those studios were often paying exorbitant fees to third-party marketing firms to create and maintain these pages. So these “free” pages are providing an even smaller return on investment.

Meanwhile, Facebook has begun pushing studios to pay for advertising in the news feed. The site announced in December that it will eventually launch auto-play video ads, a move obviously intended to entice entertainment advertisers to spend their money on Facebook.

Unlike GM, which pulled its Facebook advertising last spring, it’s unlikely that the ad-loving folks at the movie studios will abandon the site altogether.

“There are so many people on Facebook, it is a good place to have a presence — as a reminder. We buy the billboards in Westwood too — a lot of traffic drives past those,” explains one anonymous studio exec. “It doesn’t mean your film will not open if you don’t have that. The correlation is probably minimal. But when we’re opening a movie, we want to be in as many relevant places as we can.”

Sadly, it isn’t just showbiz that FB is trying to get advertising money from, it’s all of us with FB pages. TVWriter™’s FB page views are down as well since their policies changed. Our incomes don’t depend on our number of visitors or views so it’s no big deal, practically speaking (although as a matter of principle, hey, we’re bugged.) But, ultimately, FB’s income does. Wonder if the execs there see the humor in the way their idiotic attempts to make more money are actually working against their purpose…