After massive outage, small business owners bemoan – and reconsider – their Facebook addiction


During the six hours that Facebook was offline Monday, small business owner JD Holland frantically printed 250 flyers to post around Burnsville, Mississippi, and considered buying an ad in the local newspaper. two-page town to continue doing business in his farm shop and nutrition. club.

“They have my life,” Holland said of the social platform and the ad giant. Since the start of the pandemic, his business has relied on Facebook Live videos and posts on his professional page to drive sales at his nutrition club, he told NBC News. But without access to the site, his business was completely shut down.

Monday’s blackout resulted in losses of $ 300 to $ 400 in Facebook sales, Holland said. “I know the pandemic was significant, but I responded to that more like, ‘This is a great threat.’ What if he really collapses?”

“What if Facebook really breaks down? “

Holland is one of some three million businesses around the world actively advertising on Facebook that were affected by Monday’s shutdown. While Facebook apologized Monday night for the massive outage, saying the issue was caused by “flawed” configuration changes, the outage forced many small business owners to consider the risk they run in depending so strongly of a platform for their livelihood.

“It really got me thinking about what to do from an advertising standpoint in case something happens,” Holland said. “Facebook doesn’t care [we lost sales], but we have so much confidence.

Facebook has apologized to the business community in a declaration Monday, and said advertisers were not charged for ads during the outage.

“We understand the impact of such outages on the millions of businesses that use our services to find and reach customers,” the statement said. “We apologize to everyone affected and are working to better understand what happened today so that we can continue to make our infrastructure more resilient. “

Zahid Buttar, who runs an online vitamin store in Mooresville, North Carolina, told NBC News he lost between $ 5,000 and $ 6,000 in sales during yesterday’s blackout. Buttar said he spends around $ 1,000 a month on Facebook ads for the business. But after Facebook goes offline for several hours, it plans to remove those ads entirely and use emails and texts instead.

“What are we doing?” he said. “It’s like a bait and a switch. It’s like you put the hook in our cheek and we have some semblance of a business and then, boom, it went down.

Facebook is the country’s second-largest online advertiser, according to eMarketer. Google leads the way, with around 29% of the digital advertising market share in the United States, followed by Facebook with 25% and Amazon with around 11%, according to the online marketing research firm. In July, Facebook reported second-quarter profit that climbed 101% to around $ 10 billion, thanks to a 56% increase in advertising revenue over the previous year. Much of that growth is due to rising ad prices, as well as heavy ad buys by small and medium-sized businesses, Facebook CFO David Wehner said in April.

“Our goals for the future are that we want to continue to be the best place to advertise,” Facebook COO Sheryl Sandberg said on an investor conference call in April.

The Facebook outage came as public scrutiny of the platform’s size and influence in the country’s daily political, social and economic life continues to intensify. Former Facebook employee and whistleblower Frances Haugen told a Senate panel Tuesday morning that “Facebook products harm children, fuel division, weaken our democracy and more,” she told Deputy Senate Trade Committee on Consumer Protection.

Meanwhile, the company is hard a second antitrust lawsuit filed by the Federal Trade Commission alleging that Facebook used anti-competitive acquisitions of Instagram and WhatsApp to expand its dominance in the market and unfairly denied rivals access to its application programming interface.

“Yesterday really showed small businesses and all of us the control that Facebook has over an online communications platform,” said Nidhi Hegde, director of strategy at the anti-monopoly policy research group American Economic Liberties Project. “The bottom line is that a monopoly shouldn’t control such a critical information infrastructure. “

“A monopoly should not control such a crucial information infrastructure.”

Even though the blackout has forced some businesses to use old-fashioned messaging software, texting, and flyers, the main advertising medium is online, where most people shop and socialize, Hegde said.

“It’s right that you want to diversify the channels through which you reach customers,” she said. “But if the only way to advertise online is with one of two companies, you don’t have a real choice.”

But Michael Roth, managing partner of small business consultancy Next Street, said the flip side of witnessing such a large-scale small business collapse on Monday is an opportunity for lawmakers and Facebook to think about how to reach business owners. The company has deployed several initiatives during the pandemic targeting small businesses, including a free Facebook Business Suite platform, a dedicated $ 40 million from its $ 100 million black-owned business small business grant program, as well as as several online tutorials on marketing, online branding and customer acquisition.

“Facebook is clearly a huge piece of the infrastructure that supports small businesses,” Roth said. “What this outage shows is that Facebook and other platforms like Facebook have as much or more reach for small businesses than any other platform than likely the US government as a whole. and certainly banks and financial institutions. “

But for independent business owners like Sam Gibbs and his wife Ashley in Indianapolis, Indiana, a day of lost sales leaves a stinging. The couple supports their little family only through what they earn by selling accessories online through their Facebook store.

“I realize that people can joke that Facebook no longer exists, but that’s not how we see it,” said Sam Gibbs. “We depend on it for our livelihood. “

They recently hired a company to build an app so that the business wouldn’t be completely dependent on Facebook for traffic.


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