Friday, May 18, 2012

Facebook is a ponzi scheme...

Long before GM pulled its $10M in advertising from Facebook, I lost my faith in the platform. As an online media buyer for American Apparel, I had cut the majority of my spend each month for the preceding 12 months. From the time that Facebook stopped serving banner ads through Microsoft to now, the spend I oversaw fell from nearly $1M per year to a few thousand dollars a month.

As I told Direct Marketing News in March 2012: “The return is not there. Unless you’re selling apps or lead generation, I think Facebook ads are underwhelming. I see bad things ahead for the Facebook IPO and perhaps, rising dissatisfaction among clients.”

This sentiment came from my personal experience—particularly with sketchy new offerings like the “Sponsored Story” platform which essentially charges popular fan pages a premium CPM to reach their own fans in the Facebook feed (translation: FB, who controls how much or little fans see your updates, is charging to “improve” your chances of being seen). But mostly, it came from entrepreneur Joseph Perla‘s eye opening essay “Facebook is a Ponzi Scheme” in January 2011. This prescient essay outlines all the current IPO-related criticism of Facebook and it did it way before anyone else. Full story...

Related posts:
  1. Poll shows most users distrust Facebook...
  2. Facebook, apps and You. The battle to own your data...
  3. Facebook raises US$500m from Goldman Sachs, Russian firm...
  4. Bono invests £140 million in Facebook...
  5. The Federal Reserve is a Ponzi scheme, a fraud...
  6. Sesame Street explains the Madoff scandal!!!
  7. 12-year-old Victoria Grant on how the banks are ripping us off...

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