You are “just a commodity” in “Facebook” .. and this is your price!
If you ask someone what Facebook is, the first definition that springs to mind will be that it is a social media network, a recent activity that no company has practiced in its current form for fifteen years.
But what does not occur to most people, despite its clarity, is that Facebook has a completely different economic activity and has existed for a very long time, which is that it is one of the largest advertising companies in the world.
According to the latest statistics of the site in June 2020, 2.7 billion users use the Facebook site and applications every month. This is a very huge number, approaching a third of the population of the planet, and an increase of 400 million users from 2019.
But how does Facebook increase profits from a single user year after year, while the user continues to use Facebook in almost the same way without much change?
Many people may know that the main source of Facebook profits is ads, but the answer to how to increase profits from a single user consists of two parts:
The first part is that Facebook is gaining more advertisers; Every day, more companies join the Facebook Marketing Platform, which is the system through which these advertisers compete for the limited ad space that Facebook offers to a single user through a bidding system that simultaneously “Real Time” determines which ad will be shown to the user. The moment the page loads.
But suffice it to know that the more advertisers want you to personally see their ads, the more expensive your honor will be to see that ad.
The second part is the nature and quality of the information that Facebook collects about users so that you use it to display more attractive ads and more responsive to users, and thus more money can be made than one ad.
For example, if Facebook’s algorithms are 50% confident that you are interested in video games, they may show you a few ads for different games before deciding that you are not interested in them in case you do not respond, and this ad space becomes wasted because it is useless, while if it increases That confidence to 95%, for example, will continue to display these ads to you, knowing that you will respond sooner or later.