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New Facebook feed freezes out businesses

A woman surfs for deals on the Facebook page of local online retail store Little Fashion.
A woman surfs for deals on the Facebook page of local online retail store Little Fashion. Pha Lina

New Facebook feed freezes out businesses

Facebook’s recent test launch of its Explore Feed in Cambodia, a feature that shifts public posts away from private newsfeeds and into a hard-to-find channel, will have devastating effects on local e-commerce businesses that traditionally rely heavily on social media advertising, industry insiders claim.

When the new feed rolled out earlier this month, in most countries it took the form of a personalised platform for popular hand-picked content aggregated by user behaviour. However, in six small countries – Sri Lanka, Bolivia, Slovakia, Serbia, Guatemala and Cambodia – it began segregating public posts by businesses, media outlets and other “liked” pages from the newsfeed.

This feature has already proven disruptive for local commerce, according to Maya Gilliss-Chapman, a Silicon Valley-based technology analyst who has begun compiling data collected from multiple Cambodian Facebook pages. She claims that if the current trend continues it could mean the end for some small businesses.

“The Explore Feed has had a huge impact on Cambodian businesses by limiting the reach of their Facebook posts by more than 60 percent,” she said. “In Cambodia, small businesses use Facebook as their main storefront. Businesses that exist exclusively on Facebook will suffer after experiencing such a significant drop in post reach.”

However, she added that while companies with the financial ability to pay for advertising outside of Facebook will survive, she lamented the immorality of the tech giant’s latest move.

“Facebook has been moving towards a pay-to-play model for years, so this is a great business decision for them,” she said. “Unfortunately, many great business decisions are unethical.”

In Cambodia, where 4.8 million of the country’s 15.5 million citizens are on Facebook, social media has played an integral role in boosting sales and marketing reach. Now, even the biggest players in Cambodia are starting to take a hit.

Kosal Kong, Cambodia country marketing director for Coca-Cola, explained that the company relies heavily on Facebook-only video advertising.

“Consumers in Cambodia have changed,” she said. “If you’re going to advertise here, don’t spend your money on television. Go to digital, and remember that your audience is young.”

Since the Explore Feed in Cambodia rolled out this month, viewership on the Coca-Cola Khmer Facebook page has plummeted, with videos struggling to receive as many as 300 views compared to videos that racked up over a million views previously.

While Coca-Cola is unlikely to suffer much from a loss of social media reach, smaller companies are now being forced to reassess their marketing and budgeting tactics.

In Vichet, owner of local online retail store Little Fashion, a company that has a Facebook page with nearly 1.5 million “likes”, claims that he has lost his main advertising tool now that organic viewership has recently fallen by 70 percent.

“This will have a long-lasting impact on sales, but we must adapt,” he said. “I don’t plan to spend more money on television or magazine ads, since all of my potential customers spend most of their time on the internet, [but] I may consider allocating more to budgets for other digital marketing activities.”

In a recent attempt to clarify the intent of the Explore Feed, Facebook’s Head of News Feed Adam Mosseri wrote in a release last week that the feature is not yet intended to be launched globally.

“The goal of this test is to understand if people prefer to have separate places for personal and public content,” he wrote. “We will hear what people say about the experience to understand if it’s an idea worth pursuing any further.”

Despite Facebook being unsure how it will use the Explore Feed in the future, the company has indicated that it will continue testing the feature in Cambodia for at least the next several months.

However, Gilliss-Chapman believes that is too long to test the feature without incurring significant blows to Cambodia’s nascent e-commerce sector.

“[Mosseri] fails to see that this will come at the expense of the businesses and people living within these six markets,” she said. “Or perhaps he does see this, and simply doesn’t care.”

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