It was Valentine's Day that Meta's advertising platform started going off track. RC Williams, co-founder of Philadelphia-based marketing agency 1-800-D2C, uses one of his automated advertising tools in Meta to run campaigns for two separate clients. I was setting it up. However, when he checked the platform that day, he found that Meta had consumed approximately 75% of his daily advertising budget for both clients within two hours.
Williams said. The Verge The CPM, or cost per impression, of the ads was about 10 times higher than normal. Our typical CPM was less than $28, but it ballooned to around $250, far above the industry average. This would have been bad enough even if the revenue from these ads wasn't next to nothing. If you're not a marketer, this can feel like spending a week's worth of grocery money on a prime cut of Wagyu beef at a steakhouse, only for the waiter to come back with floppy sliders. .
The Verge spoke to several marketers and businesses that advertise on Meta's platform, and they had similar stories. Meta's automated advertising platform is burning through its budget and not making sales. Small and medium-sized businesses are seeing their ad dollars disappear and wasted as a result, with some saying they are turning away from Meta's platform due to overspending.
“Meta's unwillingness to be transparent and accountable for performance issues and glitches is causing great concern.”
“Meta's unwillingness to be transparent and accountable for performance issues and glitches is creating public uncertainty,” Carl Baker, founder of meditation startup Mindfulness Works, said in a message. Ta. The Verge.
The flawed ad service in question, known as Advantage Plus Shopping Campaigns, is part of a full suite of AI-enabled advertising tools that Meta is pitching to businesses as a faster and more efficient alternative to manual ad campaigns. To create an ad campaign, advertisers upload their creative assets, select a conversion goal (like get more customers to buy on Instagram), and set a budget limit. During the earnings call, Mehta touted his Advantage Plus shopping campaign as an effortless “set it and forget it” automation solution for online advertising. But that wasn't the case, marketers say.
Advantage Plus shopping campaigns are unpredictable, with some days going well and other days not so well. The subreddit r/FacebookAds has become something of a 24/7 help desk for Advantage Plus. Recent headlines discussing this issue include “Advantage+ is terrible,” “Is Facebook broken,” and “Is it just me?”
“People always say, 'Is it me?' 'Or is it meta?'” Baker said.
What Williams and many other marketers thought was a one-time glitch with Advantage Plus ended up being a recurring problem over several weeks. “From February 14th, [Advantage Plus] “We have repeatedly overspent and ignored our cost caps,” he said.
The problems continued into April. “We have several customers who have completely stopped using Advantage Plus because of these anomalies,” said Aniruddha Mishra, director of growth at Miami-based digital marketing agency Node Media. He noted that for some clients, meta CPMs have become three to four times more expensive compared to last year.
Advertisers say it was also difficult to get support from Meta. Over the past year, Meta has laid off thousands of employees and dismantled much of its customer support team.as DIGIDAY According to reports, Meta's ad account team has been downsized and many of its client inquiries are now routed to an AI chatbot. Some marketers are The Verge Those we spoke to said they've noticed a noticeable decrease in responsiveness from Meta since the migration.
“The only thing [Meta] On February 14th, the company acknowledged that there was a bug in the platform and apologized for the inconvenience. ”
“The only thing [Meta] “On February 14, we acknowledged that there was a bug in our platform and apologized for the inconvenience,” Williams said. “They didn't tell us what actually happened.”
Meta ultimately refunded 1-800-D2C for the incident, but Williams said it took several attempts to finally get someone at the company to acknowledge him. . The company issued a refund almost a month after the incident.
Some users have speculated that Advantage Plus may be “glitchy” or “broken,” but Meta insists the tool is working properly.
“When I contacted Meta representatives, I was told that they were not aware of any defects. This is really shocking because a friend of my co-founder who is in e-commerce Because we all share this feeling.” They’re dealing with the same thing,” Adriel Darvish, CEO of a luxury handbag and jewelry service called Switch, said in a phone interview. The Verge. “This is a universal thing that everyone experiences.”
As problems continued to mount, Williams' marketing company said it stopped using Advantage Plus completely in early April. Instead, I went back to the old-fashioned way of manually buying Facebook and Instagram ads. What's notable is that reverting to pre-AI, pre-automation ways of doing things hasn't put a huge strain on the company's human workforce.
“It might take an extra 10 to 20 minutes to create an ad set, but it's not crazy,” Williams says.
Meta first launched its Advantage Plus shopping campaign globally in the fall of 2022, when the online advertising landscape was uncertain. Exactly one year ago, Apple launched its App Tracking Transparency feature in iOS 14.5, making it easy for users to opt out of third-party app-based tracking utilized by many online ads. Mehta opposed the changes, saying they would “change the internet as we know it” and threaten the future of many online businesses.
But Meta's real concern was undoubtedly the threat to its advertising business, where Apple's changes would reduce ad revenue by $10 billion in 2021. Because brands don't have access to as much data as they used to, targeted ads aren't as effective as they used to be, and ads have become more expensive to launch. As a result, brands spend less on online advertising.
With the Advantage Plus shopping campaign, Meta promised that the gaping hole left by Apple's privacy update could be effectively replaced with AI and machine learning models.
Instead of tracking users, Advantage Plus uses an advertiser's own first-party sales data to help target ads. But online advertisers will essentially be handing over the reins to Meta, and will no longer have access to the granular targeting controls and deep analytics they had before Apple's privacy changes.
There was a bit of a “learning curve” with Advantage Plus shopping, but the tools gradually started to improve. Brands realized that AI-powered meta ad campaigns performed well and poured more budget into the platform. ad week reported that by April 2023, marketers who ditched Meta for new opportunities like TikTok ads and connected TV are starting to come back.
Over the last year, advertisers have had a honeymoon period with Advantage Plus, especially as Meta has started packing new features. “Currently, Advantage Plus is working very well for most of our clients, with almost 50-70% of their ad budgets going to Meta's Advantage Plus campaigns. There has been targeting and evolution, and if you know how to fine-tune the right parameters, you get very powerful performance,” says Mishra.
by email to The Verge On April 15, Meta spokesperson Kash Ayodele said the company had fixed “some technical issues” with its Advantage Plus advertising platform. “Our advertising system is working as expected for the vast majority of advertisers. We have recently fixed some technical issues to ensure the best possible results for businesses using our app. We are investigating a small amount of additional reporting from advertisers to provide.
However, marketers remain frustrated by the platform's poor performance. “Things have improved for many, but not all. The end of the first quarter and beginning of the second quarter was very eventful,” media buyer David Herman said in a direct message. I wrote it in The Verge.
The dramatic increase in cost per click (CPC) and CPM is not just a meta issue. Marketers say growing inefficiencies are driving up the overall cost of online advertising, which is exacerbated by automation. This significantly reduces profits for individual advertisers. And resolving this issue can be more complicated than fixing a “glitch” or set of glitches in Advantage Plus. Especially since the huge amount of money that Google as well as Meta has poured into automated advertising has not translated into more successful advertising campaigns.
“Account and campaign performance has not essentially improved. [over the last three years]'' said Aline Meylan of Hawk Media.
When ad campaigns are automated, like Meta's Advantage Plus, “things get swept under the rug,” Meylan says. Everything from ambiguous keywords to ambiguous audiences to low-quality advertising creates real inefficiencies and increases advertising costs for brands. “Inefficiency increases CPC and CPM because it creates artificial ‘competition’ where it shouldn’t exist.”
Meta, on the other hand, can only benefit from increased advertising revenue. According to Meta's first-quarter earnings report on Wednesday, the company's advertising business is doing well. Advertising revenue for the quarter reached $35.64 billion, a whopping 27% increase from this time in 2023.
