It was Valentine's Day when Meta's advertising platform began to go off the rails. RC Williams, co-founder of Philadelphia-based marketing agency 1-800-D2C, had set up one of Meta's automated advertising tools to run campaigns for two different clients. But when he checked the platform that day, he discovered that Meta had spent about 75 percent of both clients' daily advertising budgets in less than a couple of hours.
Williams said The edge that ad CPMs, or cost per impression, were about 10 times higher than normal. A typical CPM of less than $28 had inflated to approximately $250, well above the industrial average. That would have been bad enough if the revenue earned from those ads wasn't next to nothing. If you're not a marketer, this might seem like spending a week's worth of groceries on a prime cut of wagyu at a steakhouse, only to have the waiter return with a flexible slider.
The edge I spoke to several marketers and companies who advertise on Meta platforms who tell a similar story. Meta's automated advertising platform has been wasting budgets and failing to generate sales. As a result, small businesses have seen their advertising dollars vanish and wasted, and some have said that bouts of overspending are driving them off Meta platforms.
“Meta's unwillingness to be transparent or accountable with performance issues and failures is causing massive uncertainty.”
“Meta's unwillingness to be transparent or accountable with performance issues and crashes is causing massive uncertainty,” wrote Karl Baker, founder of meditation startup Mindfulness Works, in a message to The edge.
The defective advertising service in question, known as facebook.com/business/help/1362234537597370″>Advantage Plus Shopping Campaignsis part of a comprehensive suite of ai-enabled advertising tools that Meta offers businesses as a facebook.com/business/help/1362234537597370″>faster and more efficient alternative to manual advertising campaigns. To create an ad campaign, advertisers upload their creative assets, choose their conversion goals (for example, get more customers to make purchases on instagram), and then set their budget limits. Meta touted Advantage Plus shopping campaigns during earnings calls as a nonchalant, ai-Targeting-Tools/643785/”>“set it and forget it” Automated solution for online ads. But that hasn't been the case, marketers say.
Advantage Plus shopping campaigns have been hit or miss, seemingly working well some days and not so well others. The subreddit r/facebook Ads has become a sort of 24/7 help desk for Advantage Plus. Recent titles discussing these topics include “Advantage+ Sucks,” “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 Advantage Plus issue ended up becoming a recurring incident for weeks. “Since February 14, (Advantage Plus) has overspent on numerous occasions and ignored the cost limits we have imposed,” he said.
The problems have persisted until April. “We have a couple of clients for whom we completely discontinued Advantage Plus because of these anomalies,” said Aniruddha Mishra, chief growth officer at Miami-based digital marketing agency Node Media. He noted that for some clients, CPMs on Meta were three to four times more expensive than last year.
Advertisers say getting Meta's support has also been a challenge. Meta laid off thousands of employees over the past year and gutted many of its customer service teams. As Digiday ai/”>reported, Meta's ad account teams have been reduced and many customer queries are now directed to ai chatbots. Several of the marketers who The edge I spoke said there has been a noticeable decline in Meta's responsiveness since the transition.
“The only thing (Meta) acknowledged was that there was an error on the platform on February 14 and apologized for the inconvenience.”
“The only thing (Meta) acknowledged was that there was an error on the platform on February 14 and apologized for the inconvenience,” Williams said. “They didn't tell us what really happened.”
Meta eventually reimbursed 1-800-D2C for the incident, but Williams said it took several tries to get someone from the company to finally acknowledge it. The company issued the refund almost a month after the incident.
While some users speculate that Advantage Plus is “bugged” or “broken,” Meta's response has been to insist that the tool is working as it should.
“I contacted Meta representatives and they told me that they are not aware of any kind of problem, which is really shocking, because all my co-founder friends who work in e-commerce share this sentiment. . They're dealing with the same thing,” said Adriel Darvish, CEO of a luxury jewelry and handbag service called Switch, in a phone interview with The edge. “This is something universal that everyone is experiencing.”
As problems continue to pile up, Williams said his marketing company stopped using Advantage Plus entirely in early April. Instead, they've gone back to the old method of manually purchasing facebook and instagram ads. In particular, returning to the pre-automated, pre-ai way of doing things hasn't really taken its toll on the company's human workforce.
“Maybe an extra 10 to 20 minutes to build the ad sets, but nothing crazy,” Williams said.
Goal first released Advantage Plus shopping campaigns globally in fall 2022, when the status of online advertising was uncertain. Just a year earlier, Apple had launched its App Tracking Transparency feature with iOS 14.5, giving users an easy way to opt out of the third-party app-based tracking that powers many online ads. Meta opposed the change, saying it 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 own advertising business, which saw a $10 billion drop in ad revenue in 2021 due to Apple's changes. Targeted ads were no longer as effective because brands no longer had access to as much data and they were also becoming more expensive. As a consequence, brands reduce their investment in online advertising.
With Advantage Plus shopping campaigns, Meta promised that ai and machine learning models could effectively replace the gaping hole left by Apple's privacy update.
Instead of tracking users, Advantage Plus uses advertiser information. facebook.com/business/help/742478679120153?id=1205376682832142″>own sales data to help target ads. But online advertisers would effectively be handing the reins to Meta and would no longer have access to the granular targeting controls and detailed analytics they had before Apple's privacy changes.
Although there was a bit of a “learning curve” with Advantage Plus purchases, the tool gradually began to improve. Brands noticed that their ai-powered meta advertising campaigns were performing well and dedicated more of their budgets to the platform. advertising week reported that in April 2023, marketers who had abandoned Meta for TikTok ads and new opportunities like connected TV were beginning to ai-tool-advantage/”>go back.
Advertisers had a honeymoon period with Advantage Plus last year, especially when Meta began including new features. “Advantage Plus was working so well at this point, for most clients, that almost 50 to 70 percent of their advertising budget is going to Meta's Advantage Plus campaigns. There are so many evolutions and goals that they have made in the last year and a half. It offers really solid performance if you know how to tune the right parameters,” Mishra said.
In an email to The edge On April 15, Meta spokesperson Kash Ayodele said the company had fixed “some technical issues” with the Advantage Plus advertising platform. “Our ad system works as expected for the vast majority of advertisers. “We recently fixed some technical issues and are investigating a small number of additional reports from advertisers to ensure the best possible results for businesses using our apps.”
But marketers still complain about the platform's poor performance. “Things have recovered for many, but not for all. “It has been a very turbulent end to the first quarter and start to the second,” wrote media buyer David Herrmann in a direct message to The edge.
The dramatic rise in cost per click (CPC) and CPM isn't just a meta problem: Online ads as a whole are becoming more expensive due to what marketers say are greater inefficiencies, which automation alone has gotten worse. This significantly reduces the profits of individual advertisers. And fixing this issue may be more complicated than fixing a “bug” or series of bugs in Advantage Plus, especially since the millions Meta and Google have invested in automated advertising have not led to more successful ad campaigns.
“Account and campaign performance has not inherently increased (over the past three years),” said Hawke Media's Areen Mayelan.
When ad campaigns are automated, as with Meta's Advantage Plus, “things get swept under the rug,” Mayelan said. Everything from loose keywords to loose audiences to low-quality ads effectively become inefficiencies that increase the cost of ads for brands. “Inefficiency results in an increase in CPCs and CPMs, because you are creating artificial 'competition' where there would otherwise be none.”
In the meantime, Meta will only benefit from increased advertising revenue. According to Meta's first-quarter earnings call on Wednesday, its advertising business is performing well. Advertising revenues totaled $35.64 billion during the quarter, a impressive jump 27 percent from now on in 2023.
