New Facebook Rules Will Stifle Small Business & Entrepreneurs

More than 80% of small companies using social media to promote their businesses list Facebook as their top marketing tool, followed by LinkedIn and Twitter, according to a recent survey of 2,292 small businesses by Webs, a digital services division of Vistaprint. The top three reasons owners cited for creating a Facebook page were customer acquisition, building a network of followers and increasing brand awareness, according to the survey.

Chrisy Bossie built a $100,000-a-year gemstone e-commerce business by sharing information about her products on her company’s Facebook page several times a week.

“Steals in the Shop! I have a TON of new 36-inch-long necklaces, most priced at $15, available in amethyst, lapis, watermelon tourmaline, turquoise.... Shop them all here,” she wrote in a recent marketing post on a Facebook page for Earthegy, the business she runs from her home in rural Kent Store, Va. She also included photos and links to the products, hoping the business’s 70,000 Facebook fans would share the posts with their own Facebook friends.

But small-business owners like Ms. Bossie will soon get less benefit from the unpaid marketing pitches they post on Facebook. That’s because, as of mid-January, the social network will intensify its efforts to filter out unpaid promotional material in user news feeds that businesses have posted as status updates.

The change will make it more difficult for entrepreneurs like Ms. Bossie, the founder of four-year-old Earthegy, to reach fans of their Facebook pages with marketing posts that aren’t paid advertising.
Businesses that post free marketing pitches or reuse content from existing ads will suffer “a significant decrease in distribution,” Facebook warned in a post earlier this month announcing the coming change.

The upshot for Ms. Bossie is that “if I do not pay to promote the post or boost it, it’s hardly reaching anyone,” she says. Now, more than half her sales come via her Facebook posts, she estimates.

Blake Jamieson, a marketing director at Pool Supply World, a small Phoenix, Ariz., supplier of chlorine, pumps and filters for home pools, says its Facebook posts now generate average item sales “in the single digits,” down from 10 to 15 items per post in 2012. By posting photos of water parks or tropical resorts on its Facebook page, Pool Supply World has accumulated more than 100,000 “likes,” or fans of its business page.

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