In your scenario, Alice already decided not to buy anything from AcmeShop.
Even if AcmeShop advertised on Facebook it wouldn't have changed her behavior. She got a better deal on Facebook Marketplace. And she was already visiting Facebook and the Marketplace is already a single click.
I don't see the abusive or predatory part. It seems like Facebook Marketplace just offered a superior used 3D printer for her.
So what part am I missing?
Yes, it's a better deal on the face of it, but as soon as AcmeShop goes out of business, competition is gone and Facebook can charge whatever they want. And we all know from the US markets that low to no competition does not benefit the consumer in any way.
Facebook Marketplace is a marketplace. They don't control the products that are being advertised. All they can control is the weighting of ads they run on certain products e.g. "AirPods are popular, increase ad spend to 20% of total".
But they could do this by simply optimising for ROAS just like every other company does.
If Facebook is sharing AcmeShop data with Marketplace, and it's a very big if, it would still be of almost no value.
Facebook isn't setting prices on Marketplace -- sellers like you and me are. We're not getting any data from AcmeShop.
When you say "Yes, it's a better deal on the face of it", I don't know what "deal" you're talking about.
Not really, that's exactly what "remarketing" ads are for — companies track people's interest and remind them of their products. However, in this case, Facebook is double dipping by taking money from their paying customer (AcmeShop), and then using data they obtained whilst serving their paying customer to frontrun the customer.
If you or I tried something like that with Facebook — say, taking salary from Facebook and also using data we accessed through our role to undermine Facebook's business — it'd clearly be both illegal and immoral. Somehow, with enough layers of indirection, for a lot of people the same play is acceptable when Facebook does it.
How is Facebook showing remarketing ads for items on Facebook Marketplace, the ads paid for by a Marketplace seller who is boosting their item, any different from Google showing remarketing ads for items on eBay, paid for by an eBay seller?
Because that same thing would be happening if AcmeShop were using Google Analytics. Or if Alice had just done a Google search, which might be how she found AcmeShop in the first place.
Or are you arguing against remarketing ads entirely?
I guess I'm just having a hard time seeing any harm here because Alice visited AcmeShop first and didn't buy anything. Like, if I run a shop stall that sells frobulators, and I see someone pass by a nearby stall that also sells frobulators, and they browse but don't buy one, and after they leave I wave to them, and they buy one from me because I have the exact model they wanted... I don't see anything illegal or immoral at all. The first store already had their chance! If Alice liked their items, she would have already bought from there, or gone back there when she was ready to buy.
Google doing the same thing is hardly a good excuse.
In your analogy, you don't just "see". You're employed by a nearby stall because you're one of the few plumbers in the town, so you're in that shop a lot, but you're also making photos of their customers and then use those photos to find them on the street and advertise your frobulators. You really don't see anything weird about this scenario?
Besides, if a shop has only one chance ever, what are remarketing ads (marketed by Facebook to businesses) for?
I thought you were suggesting this was remarketing, now you're saying it's just targeted advertising, are you saying targeted advertising is bad? Because AcmeShop is free to run targeted ads on Facebook too, whether remarketing or not.
I genuinely don't understand what you think Facebook is doing wrong here in having a targeted ads platform at the same time as running Marketplace. I don't see how doing the two together is abusive or predatory in a way that is different from doing those things as separate corporations.
- AcmeShop is paying Facebook money to run a targeted marketing campaign on Facebook
- to do this, in practice AcmeShop is forced to share visit data with Facebook (this bit could be done differently, but for some reason that's how Facebook does it)
- a customer goes to AcmeShop, doesn't make an immediate purchase, leaves
- AcmeShop is paying Facebook to run a remarketing campaign for that customer, showing them the same product leading to AcmeShop
- at the same time, Facebook is using information that they obtained in the process of providing paid services to AcmeShop to show goods on their marketplace platform to the customer. For Facebook, it's not "remarketing", it's just "marketing" at this point. Not only that, but they control which ads they are showing, and naturally with Marketplace-only placements Facebook has an advantage over AcmeShop (again, using information that they effectively forced AcmeShop to provide)
Does this reframing make the problem of Facebook being both an ad seller, an ad manager, and offering the same service as their customers any clearer?
> but they [Facebook] control which ads they are showing, and naturally with Marketplace-only placements Facebook has an advantage over AcmeShop
My question is, why do you think Facebook won't simply sell the ad space to the highest bidder, whether it is AcmeShop or a Marketplace seller? Why do you think Facebook is giving an advantage to Marketplace ads? Do you have any evidence they are?
Remember, Facebook doesn't even make money if you sell something locally and pay in cash. A big way that Marketplace makes money is through ads. But if AcmeShop is bidding more for ad space, then presumably Facebook will show the AcmeShop retargeting ad instead.
If there is evidence that Facebook is showing lower-bidding Marketplace ads over higher-bidding AcmeShop ads in your Instagram feed, because of the fee it takes on shipped items that use Facebook Marketplace Payments, then yes I agree that would definitely be an abuse of power! And thank you for explaining that -- if that is what you're saying.
But I think it has to be shown that Facebook is actually engaging in that kind of anti-competitive behavior. We can't just assume it. There's nothing inherently wrong with running the two businesses together.
(Also, if by "Marketplace-only placements" you're referring to boosting listings within Marketplace as opposed to more general ads like on Facebook, there's nothing preventing AcmeShop from listing and boosting its items on Marketplace as well.)
Depends on which placement you mean.
"Boosted listings" in Facebook Marketplace? AcmeShop can't bid on that.
In-Marketplace ads like [0]? They are similarly in-Marketplace, I don't think it's technically possible to bid on them.
In-feed Marketplace ads like [1]? They are specifically Marketplace, I have no evidence that they enter the same bidding pool, and it seems improbable.
In-feed generic auto-placed ads like [2]? Maybe, maybe not.
> Remember, Facebook doesn't even make money if you sell something locally and pay in cash.
Facebook doesn't just make money from boosted listings, they also benefit from people just using Facebook. Even if Facebook didn't make any money directly from Marketplace, it'd still be worth it for them and it'd still be anti-competitive. If they can make themselves the main marketplace, it creates a large captive audience scrolling through their ads.
> But I think it has to be shown that Facebook is actually engaging in that kind of anti-competitive behavior. We can't just assume it.
Aren't we commenting under an article about a fine for anti-competitive behaviour?
[0]: https://storage.googleapis.com/website-production/uploads/20...
[1]: https://newsfeed.org/wp-content/uploads/Marketplace_boosted_...
[2]: https://storage.googleapis.com/website-production/uploads/20...
I think we've reached the point where it really does hinge on exact details which we don't really know the answers to. And while yes, we are commenting on an article about supposed anti-competitive behavior, the article doesn't actually describe the specifics at all, and courts get things wrong all the time (and overturned on appeal).
I mean, AcmeShop is free to list their items on Marketplace as well and compete with boosted ads in cases [0] and [1], and like you say, "maybe, maybe not" their ads compete on bids for [2] -- I would assume they would if Facebook is maximizing profit.
I don't see any evidence that Facebook is obviously or necessarily abusing its position, but it's not like I could rule it out either, specifically in the case of [2] -- it seems like it depends on the exact ad selection algorithm they use.
In any case, I can't keep the conversation going any further, but it's been very informative having this exchange. It's been a great back-and-forth, so thank you!