Central Perk

joi, 23 ianuarie 2014

Make Facebook's Algorithm Change Work For You, Not Against You

Posted: 22 Jan 2014 03:16 PM PST

Posted by Chad Wittman - Founder @EdgeRank Checker

This post was originally in YouMoz, and was promoted to the main blog because it provides great value and interest to our community. The author's views are entirely his or her own and may not reflect the views of Moz, Inc.

Recently, many Facebook page admins have experienced a significant decrease in Total Reachâ€"specifically, organic reach. For pages that want to keep their ad budget as low as possible, maximizing organic reach is vital.

To best understand how to make a change like this work for you, and not against you, we need to examine what happenedâ€"and what you can do about it.

We analyze and monitor this type of data for thousands of pages with a tool called EdgeRank Checker. By monitoring metrics such as reach and engagement over time, we can get a better understanding of how to advise companies to continue to optimize their strategy. We've collected this data over the past few months against roughly 1,000 anonymous Facebook pages.

What happened?

Facebook page admins most often run into two metrics: reach and engagement. Facebook presents this data when viewing your posts by showing the number of likes, comments, and shares, along with how many people saw the post.

What does "1,000 people saw this post" actually mean, though?

Facebook adds up everyone who saw the post, whether you paid for people to see it, people shared it with their friends, or Facebook gave you free distribution in the news feed. The people who saw it for free combine with the people who shared it to create "organic reach." When people see your post because you paid for additional exposure, they call it "paid reach."

Organic Reach = Free distribution + People who share
Paid Reach = People who saw it because you paid
Total Reach = Organic reach + Paid reach

On December 2, 2013, Facebook announced that they would be placing an emphasis on links while continuing to punish meme content in the news feed.

Around this time, we noticed a significant drop in organic reach for many pages. Page admins around the world were reporting a drastic drop in their organic reach. Not all pages were severely impacted by the change, but the majority seemed to be impacted negatively.

We've seen changes like this in the past. In fact, every time we've ever studied organic reach (we've been monitoring it closely for ~three years) we've found it has decreased over time. The reason being that the past three years have seen steady growth from Facebook, which means increased competition to get into the news feed. During this time, Facebook has continued to improve its news feed algorithm to focus on quality contentâ€"raising the bar for any page on the platform.

Examining the numbers

In the graph below, the first bar represents September 2012 (for a reference point), while the rest of the bars represent months within 2013. Over a year ago, organic reach fared much better than it does today. In the past few months, we've seen a decrease from 12.6% to 7.7%.

We specifically examined the 28 days before and after December 2nd:

When changes like this have occurred in the past, Facebook has tended to defend its news feed changes by attempting to keep engagement rates roughly equal. How did engagement data fare?

In general, engagement levels for pages fluctuated within normal variations. In some cases, engagement actually increased. From Facebook's perspective, this is a good change for their news feed; it provides a better experience for the typical Facebook user, as they are seeing less of the stuff they don't want to engage with.

How did different content types fare?

All of the content types experienced decreases over the time period analyzed. Status updates continue to outperform videos, photos, and links for organic reach. Status updates have held strongly over the past year as the top-performing content type for organic reach.

A look at individual pages

Not all pages were impacted the same. We saw some pages experience drastic decreases, while others were positively impacted by the change. We examined a few of these pages to dig deeper into theories on why they may have been impacted so extremely.

Some pages experienced significant, and abrupt, decreases in reach:

The page above experienced a significant decrease closer towards December 5th. After the change, not a single post experienced more than 15% organic reach (compared to their previous average around 25%). This page posted mostly status updates and often asked for engagement. Take a look at their status updates when asking for engagement:

In the graph above, you can see a clear and abrupt change around December 6th.

However, other pages experienced significant improvement:

The page above experienced an increase after the change (we found a few of these). This page exclusively posted photos over this time period and did not regularly ask for engagement. Let's take a look at their photo posts:

Around December 8th, this page experienced an increased average in organic reach. It benefited from the change. After that point, this page did not have as many low-reaching posts, and had many more high-reaching posts (note: our system maxed them out at 100% impressions / fan).

What did these pages do differently?

Page A	Page B
Posted mostly status updates	Posted mostly photos
Asked for engagement frequently	Rarely asked for engagement
Saw a significant decrease in organic reach	Saw a significant increase in organic reach

Interestingly, Facebook did specifically reiterate that they would be focusing on "high quality content" that isn't often using drastic calls to action to attract engagement. This may be the reason behind the difference in organic reach.

In an informal poll of Facebook admins, a vast majority of respondents self-reported drastic decreases. Sprinkled throughout the responses were some admins who were able to reduce the impact of the change (or even improve it). In our data, we found ~80% pages experienced a decrease over the time period.

7 tips to gain reach instead of losing it

The pages that were least impacted by the changes tended to focus on avoiding meme content, as well as avoiding frequent use of calls to action. Facebook is attempting to decrease these types of tactics in the news feed. Pages that have heavily used these tactics in the past may be more severely punished.

Facebook has said (and always maintained) that it is ideal to structure your content in the most logical way. Stories that include links should be posted as links. Many page admins like to include links within the descriptions of photos, however this is against Facebook's general wishes. We always suggest to deliver your content in the best way for your audience to actually consume it.

Focus, focus, focus on engagement.
Study, analyze, and understand why your fans click the like button for your content.
Avoid overusing strong calls to action.
Avoid using memes.
Analyze outbound links to determine which source is the most well received.
Increase post frequency.
Test different times of day for different types of content (e.g. news stories in the morning and product promotions in the evenings).

How was this data studied?

We examined ~100,000 posts over 11/4 -12/30 from approximately 1,000 pages. For any general metrics we averaged each page's metrics and looked at the median of all the pages when examining aggregate data. Any "per-fan" data examined the metric divided by the number of fans for that page on the the day of posting.

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Seth's Blog : Copyediting, line editing and the other kind

Copyediting, line editing and the other kind

The copyeditor will fix a misstated fact, spot a typo and get your prose clean.

The line editor will rearrange a paragraph and help you organize a thought more clearly.

And the editor who is your partner will tell you that the chapters are in the wrong order, that you must delete a third of what you wrote, or perhaps consider writing for TV instead. This kind of editor is the one who will tell you your time is better spent doing something else entirely.

It's easier (but not easy) to find a good copyeditor than it is to find someone generous and brave enough to help you figure out your strategy, whether you're working on a book, a career or the structure of your next project.

The copyeditor can tell you that you mangled a few facts early in your presentation. The line editor will help you untangle a complicated story near the middle. And your strategic editor will help you see that a one-on-one meeting would have been better than a presentation in the first place.

Sure, fix my typos, thanks a lot, but what's truly precious is someone able to fix your plan.

Worth noting that most critics and journalists are comfortable being metaphorical copy editors, but it's rare you find someone who speaks up with sensible thoughts about your strategy.

Treasure the folks willing and able to develop a point of view about the big picture.

• Email to a friend •

miercuri, 22 ianuarie 2014

Mish's Global Economic Trend Analysis

State Bank Nonsense from Ellen Brown Revisited
Italian Banks Need Extra $57 Billion for Loan Loss Reserves, 18% of Loans Non-Performing
False Thesis of the Day: Huge Cash Pile Puts Recovery in Hands of Corporations; Cash Cow Revisited
Target Drops Healthcare Coverage for Part-Time Workers, Claims No Reduction in Hours; Thank Your Employer?

State Bank Nonsense from Ellen Brown Revisited

Posted: 22 Jan 2014 08:11 PM PST

I have been thinking a bit more on the George Mason University paper on State Fiscal Conditions. Before I tie this back to Ellen Brown's state bank thesis, here are the pertinent charts once again.

PolicyMic Produced this Chart of State Fiscal Conditions.

Highlights and Lowlights

Let's return to the original working paper for some highlights and lowlights.

At the bottom of the rankings are New Jersey and Illinois. New Jersey faces long-run solvency problems due in part to nearly 15 years of underfunding its state and local pensions. It has an estimated unfunded pension liability of around $25.6 billion as well as $59.3 billion in unfunded liabilities for the health benefits of retired teachers, police, firefighters, and other government workers (State Budget Crisis Task Force 2012).

Illinois has also underfunded its public pensions, resulting in an estimated state retirement system combined unfunded liability of $ 96.8 billion as of 2012 (Illinois Commission on Government Forecasting and Accountability 22 2013). To cover the costs of its pension obligations, Illinois has also sold bonds to cover its annual contributions — 60 percent of Illinois' total outstanding debt is in pension bonds (State Budget Crisis Task Force 2012). In essence, Illinois is using long-term debt instruments to meet current year pension obligations.

[In Contrast] Nebraska is constitutionally prohibited from incurring debt. As such, the long-term liabilities reflected in Nebraska's long-run solvency score are mainly due to claims payable for worker's compensation, Medicaid claims, and other employee-related items. With no significant bond debt, Nebraska has a much lower long-term liability per capita and a much lower long-term liability ratio than most other states.

Bottom 5 in Long-Term Solvency

In terms of long-term solvency (the most critical issue), New Jersey and Illinois are at the bottom of the heap. Pension plans and union activism are to blame.

All five states at the bottom of the list have one thing in common: they got that way via "progressive" extreme-liberal politics, fueled by union activism, and promises that cannot possibly be met.

Compare to the top five.

Top 5 in Long-Term Solvency

Ellen Brown Revisited

Ellen Brown has made a career promoting the idea North Dakota is doing well because it is the only state with a state run bank.

Here's reality: A number of states are in good shape because of sound fiscal policies.

If you are looking for academic silliness, do a search for Ellen Brown North Dakota Sate Bank.

Better yet, play this downright scary video

If I only Had a Bank

The idea that North Dakota, a small loosely-populated farm state is in good shape only because it has a state bank is preposterous.

Worse yet, Brown takes that absurd position to the extreme, with a proposal to end the Fed and put California politicians (state politicians in general) in charge of printing money to support union causes.

Ellen Brown understands various problems with the Fed, but proposes a solution that is even worse, putting state politicians in charge of printing presses.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Italian Banks Need Extra $57 Billion for Loan Loss Reserves, 18% of Loans Non-Performing

Posted: 22 Jan 2014 05:45 PM PST

It will be interesting to see how well Italian banks handle stress tests later this year given new S&P capital shortfall estimates.

Of course, the stress tests were watered down twice already, and if need be I am sure ECB president Mario Draghi can find additional ways to further dilute the tests.

Yet, whether or not the losses are hidden, they are real. S&P warns Full recovery a long way off for Italian banks

Italian banks will need to set aside as much as 42 billion euros ($57 billion) in new provisions for credit losses by the end of 2014 and some may have to raise additional capital, rating agency Standard & Poor's said on Tuesday.

It said a full recovery for the sector, which was badly hit by the euro zone debt crisis and is struggling with rising bad debts, remained a long way off because of Italy's weak economic prospects and continued deterioration in asset quality.

S&P expects the stock of bad loans at Italian banks to rise to 310 billion-320 billion euros by the end of this year, or about 18 percent of customer loans.

That will force the lenders to set aside an additional 32 billion-42 billion euros to cover for credit losses between June 2013 and December 2014, according to the agency's estimates. Combined loan loss reserves stood at 111 billion euros at the end of June last year.

"The large stock of NPAs (non-performing assets) is likely to remain a burden for Italian banks as a protracted economic recovery and rising unemployment could lead to further asset quality deterioration," S&P said in a report.

History suggests the rating agencies are rather conservative when estimating such losses. Thus, I expect shortfalls to be much bigger than estimated, especially given the overly rosy estimates of a European recovery that is realistically nowhere in sight.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

False Thesis of the Day: Huge Cash Pile Puts Recovery in Hands of Corporations; Cash Cow Revisited

Posted: 22 Jan 2014 01:00 PM PST

Anousha Sakoui, M&A Correspondent for the Financial Times says Huge cash pile puts recovery in hands of the few.

The pile of unspent corporate cash that has built up since the start of the financial crisis is being held by an increasingly concentrated pool of companies that will be crucial to hopes of a pick-up in business investment to stimulate the world economy.

About a third of the world's biggest non-financial companies are sitting on most of a $2.8tn gross cash pile, according to a study by advisory firm Deloitte, with the polarisation between hoarders and spenders widening since the financial crisis.

This will have a big influence on whether 2014 will bring a revival in capital expenditure or dealmaking, warned Iain Macmillan, head of mergers and acquisitions at Deloitte. "Looking ahead, the wave of cash that many are expecting will depend on the decisions of a few, rather than the many," he said.

The study focused on gross cash holdings rather than subtracting their debt in an effort to simplify comparisons over time and identify how much money companies have to hand.

One can stop reading right there, knowing full well the report by Deloitte is totally useless at best.

By ignoring debt, Deloitte's analysis does not represent the true corporate financial picture.

For example, if a corporation has $50 billion cash on hand and $50 billion in debt, Deloitte treats that as more available cash than a company with $10 billion in cash and no debt.

Investors are equally foolish.

A survey of fund managers conducted by Bank of America Merrill Lynch released on Tuesday shows record 58 per cent of investors polled want companies' cash piles spent on capex. A record 67 per cent said companies were "underinvesting".

Expand capacity for what? What is it we need more of? Mergers and acquisitions? At these prices?

I suggest any company smart enough to have genuine cash on hand, hold it, hope for a crash, then and only then acquire assets after they have plunged in value.

Cash Cow Revisited

I did a report on corporate cash in April of 2013. At that time, the five largest corporations, led by Apple, were sitting on available cash of $39.71 billion.

Care to guess the actual cash levels of the top 50 non-financial companies?

Taking debt into consideration, even counting short-term investments as cash, the answer back in April was negative $543.67 billion.

For more details, please see Cash Cow: Of the 50 Largest US Companies, Who has the Cash? Who has the Debt?

No Net Cash

Simply put, there is no net available cash, although a handful of companies do have some. Is a continued recovery really in the hands of Apple, Google, Microsoft, and a few others?

Clearly not.

Equally clearly, Deloitte wants companies to spend money they have already spent!

By the way, this "alleged cash" is nothing more than an economic distortion caused by the Fed's artificially low interest rate policy that enables corporations to borrow at lower and lower rates. Many do, even though they have little use for the money, and so it sits.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Target Drops Healthcare Coverage for Part-Time Workers, Claims No Reduction in Hours; Thank Your Employer?

Posted: 22 Jan 2014 10:13 AM PST

Obamacare does not mandate healthcare coverage for part-time employees (defined as those working less than 30 hours a week). As a direct result, numerous retail stores including Trader Joe's and Home Depot have already stopped offering healthcare plans to part-time workers.

Today, Target, the second-largest U.S. discount retailer by sales with about 361,000 total employees last fiscal year, joined the list. Effective April 1, Target to Drop Health Insurance for Part-Time Workers.

"You see a lot of retailers making adjustments in contemplation of the full effect of the employer mandate penalties in 2015," Neil Trautwein, a lobbyist with the National Retail Federation, a trade group in Washington, said in a phone interview. "Even though it is not effective yet, it is already having an effect on the job market and putting companies where they would probably not otherwise want to be."

"Health-care reform is transforming the benefits landscape and affecting how all employers, including Target, administer health benefits coverage," Jodee Kozlak, Target's executive vice president of human resources, said in yesterday's web posting. She cited "new options available for our part-time team, and the historically low number of team members who elected to enroll in the part-time plan."

No Target workers will see their hours cut as part of the change, she said. A Target spokeswoman, Jill Hornbacher, wouldn't say how many part-time workers the company employs, saying in an e-mail that the number "fluctuates often."

The Affordable Care Act created new government-run health insurance exchanges to sell coverage to uninsured people, often with premiums discounted by federal subsidies. It disqualifies Americans for subsidies at the exchanges if they have an offer of "affordable" coverage from their employers, defined as an insurance premium less than 9.5 percent of their income.

Target plans to pay $500 to part-timers losing coverage and a consulting firm will help those workers sign up for new Obamacare plans. It said on its website that many part-time workers may prefer coverage from the health law's exchanges, and that by offering them insurance, "we could actually disqualify many of them from being eligible" for subsidies.

No Reduction in Hours?

Target claims there will be no reductions in hours worked. The only way I believe that is if Target already reduced hours, well in advance.

The huge, ongoing discrepancy between Household Survey employment, and the Establishment Survey jobs report suggests just that.

For example, over the last year, the household survey (on which unemployment is based), shows an average monthly gain in employment of 115,000 per month.

In contrast, the establishment survey jobs report shows an average gain of 182,000 jobs per month.

The difference is 67,000 per month.

Where are those jobs? I suggest two things happened as a direct result of Obamacare.

Employers reduced hours to get under the 30 hour definition of part-time
Employees responded by taking a second part-time job, thereby distorting the monthly job counts

For further discussion, please see Employment vs. Jobs Discrepancy - December 2013 Data.

Thank Your Employer?

If you are a part-time employee, Rick Newman writing for Yahoo!Finance says You May Want to Thank Your Employer.

Trader Joe's is one employer known for offering generous health care benefits, even for part-timers (until now). But even those workers could end up better off under Obamacare. In an internal email published by the Washington Post, a Trader Joe's exec provided some calculations for a part-time employee who earns about $24,000 per year and has been paying about $167 per month as her share of a Trader Joe's policy similar to a "silver" plan under the ACA. If she enrolls in Obamacare, the subsidized cost would fall to about $70 per month for nearly identical coverage. And that's before a $500 annual stipend Trader Joe's plan to offer part-timers to help them pay for insurance.

Questions Abound

Should part-timers also thank their employer for the reduction in hours they work so that companies could get under the 30-hour part-time limit?
Should those who have to subsidize others thank their employer as well?
Should the youngest age groups who were forced into the system against their will, and at high cost be grateful?

Before we blindly march down the "thank your employer" path proposed by Rick Newman, please recall that Obamacare did not solve any long-term problems in terms of reducing overall costs. All Obamacare did was create a different set of winners and losers with massive distortions on the job front, and insurance front, including incentivising companies to reduce worker hours.

Is everyone supposed to thank Obama for that?

Addendum:

Reader Charles commented (and I agree): The number one loser is the taxpayer, as federal subsidies for all involved will be much higher than estimates.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Photos: What my day looked like

Hey, all --

On Tuesday, President Obama will deliver his fifth State of the Union address from the Capitol. He's taking the lead on his own remarks, but as his chief speechwriter, I've been spending the week helping him craft what he wants to say.

Today I took over the White House's Instagram account to give you a look inside the State of the Union process.

Take a look at some of today's photos: