By Ray Birch
FAIRFAX, Va.—Significant changes made by Facebook to its advertising rules are going to affect how credit unions use the platform to promote themselves, and it will require much greater use of analytics to assess return on investment, experts say.
The social media giant’s new rules will also reduce the ability to target audiences via the platform as closely as they have in the past, sources said.
The new rules—enacted in response to a host of issues, such as allegations of discrimination–have already been being felt by advertisers whose new campaigns are being “disapproved” by Facebook. The changes, which center on ads addressing credit, housing and recruitment, became effective in August and are the result of a legal settlement reached with anti-discrimination groups. The rules affect how specifically advertisers within those three categories can target individuals to receive its messages via Facebook.
Marketing consultant Paul Lucas contends the biggest affect on credit union advertisers is they will be forced to measure social media results much more closely.
“Now, more than ever, you need to be very careful to make sure you get some kind of return on investment with your Facebook advertising, or social media in general,” said Lucas, referring to the increased difficulty in creating micro-targeted messages. “You have got to make sure this advertising is bringing you some kind of measurable, quantifiable results. You will need to be able to clearly answer why you spent the money on this and what it returned to you.”
Lucas contends many credit unions continue to do a poor job of measuring results from social media advertising.
Changes Announced by Facebook
The biggest changes to Facebook’s advertising rules include:
- Gender, age, and multicultural affinity targeting options that are no longer available when creating Facebook ads
- Targeting by zip code will not be permitted
- Targeting options that may relate to race, color, national origin, ethnicity, gender, age, religion, family status, disability, and sexual orientation, among other protected characteristics or classes, will not be permitted
- Advertisers promoting credit, housing, or employment ads will not be permitted to use Facebook’s “Lookalike Audience” tool. That tool enabled replication of a company’s current target group
Will the changes impact budgets?
“Overall, I don’t think these new Facebook rules will have a huge impact on credit union marketing budgets, first of all, because there are not a lot of credit unions aggressively engaged with social media,” said Lucas. “Sure, you have a number of them using it, but how many are really doing a great deal of focused, social media advertising?”
Paul Lucas
Softer Sells
Lucas noted many more credit unions use social media not for product promotion but instead for softer selling, such as the posting of pictures of events, community involvement efforts, and special programs at the CU’s branches, which don’t have an advertising focus and whose impact is very difficult to measure. He stressed few CUs—perhaps only the very largest shops–have allocated significant budget dollars for targeted Facebook ad campaigns.
He noted the biggest credit unions, such as Navy FCU, Pentagon FCU and even large community CUs such as Ent in Colorado, due to their size have the means to maintain a strong Facebook presence.
“The new rules will impact these credit unions the most,” Lucas said. “But if the credit union is going to spend marketing dollars here, they must now be even more careful about what they spend and measure,” Lucas said. “I am not sure how much value Facebook really brings credit unions today, and these new rules are just going to make things tougher.”
Tougher Rules
Jason Lindstrom, president and CEO of Evergreen CU in Portland, Maine, agrees the rules add difficulty.
“I think the new rules do make it tougher, but the rules make sense,” said Lindstrom, who chairs CUNA’s Marketing and Business Development Council. “Credit unions must always practice anti-discriminatory tactics, and this just puts guidelines around that for Facebook ads.”
Lindstrom noted that compliance is always changing, and credit unions need to adapt with the changes.
“Facebook is a platform that is always changing, so the key here is having the ability to recognize that and move forward,” he said. “Here at Evergreen we’ve always used Facebook as an informational channel more than a channel that pushes product and rates. I believe consumers would rather see ads in their feed from us on stopping fraud, or how to buy a car or home, and what we are doing in the community we serve versus ads about rates.”
Accustomed to Compliance
Lindstrom expects credit unions’ familiarity with compliance mean Facebook’s changes won’t have a huge impact on credit unions.
Jason Lindstrom
“Credit unions are used to adapting to regulations and rule changes,” Lindstrom pointed out. “With increased, ongoing regulations, compliance, and rule changes credit union marketers are always having to adjust ways of advertising and trying new things. In my opinion, we will just comply and figure out ways to adapt.”
Lindstrom believes the changes will be felt by credit unions of all sizes.
“I think you’d be amazed at all the smaller CUs that have a social media presence,” Lindstrom said. “I think social media has become part of most credit union’s marketing plans, so the rules will impact all sizes.”
Measurement Necessary
Like Lucas, Lindstrom said measurement of Facebook marketing is important.
“Social media is just one of many channels in the marketing arsenal, so I believe it should be measured continually,” he said. “At my credit union, we regularly look at our social media posts for the open rate and click through rates and we measure how social media posts do versus our other channels. A Facebook rule change may cause us to take a harder look at what we post—so we aren’t banned from Facebook—and also see how rule modified posts are doing.”