[shostack]

I wonder how much better performance they could deliver if they improved their attribution tools, ad interface, bid rules, etc.

Part of the problem is that if you do anything at scale with FB you really should be using a PMD. For many things the Ads Manager and Power Editor are just painful.

I'm also not in love with how conversions are tracked and optimized against in terms of how they try to lump everything possible in as a conversion to show a higher number and try to convince advertisers that all those components have equal value.

[rufb]

Running an FB campaign focused on performance is, like I said, a game of finding the lowest on-target/high-conversion CPM (conversely: finding your intended audience at its cheapest). It's not in Facebook's interest to disclose this information too easily, as part of their profit margin comes from squeezing campaign spread.

So my thinking here is that their tools are poor at performance optimization by design, so that we have to jump through hoops, experiment and throw money at different audience mixes in order to find just the right creative-segment-budget allocation. So I don't think that is headed to change so long as they are allowed to keep playing black box and walled garden.

I was astounded how easy it was to get better CPA/ROI running Facebook campaigns on, say, DBM or Criteo even at a premium on the CPM. It goes to show just how lacking their tools are in fast audience and creative optimization.

[shostack]

So there's definitely something to be said for tools that can optimize the best to deliver higher ROI despite higher CPMs.

That said, I'm not sure I fully agree on where FB's interests lie. They've come under a LOT of fire over the past couple of years for various things that people felt inflated the value of their inventory, and so helping advertisers prove they can drive more value and provide tools to help them scale more easily would all be things that should help their bottom line. Particularly when marketers have to make a budget allocation decision towards something that might be a bit more mid/bottom funnel like SEM.

So to compete for that same budget, they need to be competitive on all fronts, and right now they are not. Their margins might be higher from obfuscating some of these key insights that might let people trim the fat, but that needs to be weighed against potential lost revenue from advertisers who can't reach profitability quickly enough and stop advertising, or lost budget share from advertisers who shift it to other channels.

I don't have numbers on those hunches to back them up of course, but it just seems like a really poor long term decision to intentionally cripple your platform in such a way (and that is inherently different than just poor design or design geared to make it easy to spend).