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Amazon is the latest threat to Facebook as ad targeting suffers



Amazon is the latest threat to Facebook as ad targeting suffers

Mark Zuckerberg, chief executive officer of Meta Platforms Inc., left, arrives at federal court in San Jose, California, US, on Tuesday, Dec. 20, 2022. 

David Paul Morris | Bloomberg | Getty Images

For Matthew Hassett’s smart alarm clock company Loftie, the 2022 holiday shopping rush was the busiest in its five-year history despite a lackluster U.S. economy and persistent concerns of a recession.

Hassett, who’s based in New York, attributes the boon to one key decision. He reallocated his marketing budget, decreasing spending on Facebook and, for the first time during a holiday season, committing ad dollars to Amazon.

“So many people start their shopping on Amazon,” Hassett said in an interview. “I do personally for most things. So, we have to be there.”

Loftie is representative of a larger trend taking place in retail that’s having major ripples on Madison Avenue and Wall Street. Amazon’s increased advertising offerings for the millions of brands that sell on the site coupled with Facebook’s diminished targeting capabilities that resulted from Apple’s privacy changes have produced a significant realignment in the digital ad market.

Until a year ago, Amazon didn’t even disclose the size of its advertising business, leaving analysts and investors to guess how much the company was making in allowing sellers and brands to promote their wares on the site and apps. Now, the company’s ad division is a $38 billion annual business, and last week reported 19% year-over-year growth in the fourth quarter to $11.6 billion.

Facebook-parent Meta, meanwhile reported a 4% annual decline in revenue for the quarter to $32.2 billion, shrinking for a third consecutive period. Google has been less impacted by Apple’s iOS update, but the ad business is still being hit by the economic slowdown. Parent company Alphabet posted growth of 1% to $76 billion.

Amazon has catapulted to third in the global digital ad market, with 7.3% share, according to Insider Intelligence. Even as it takes share from Google and Facebook, it’s still well behind the two market leaders, which control 28.8% and 20.5%, respectively, of the industry. The Facebook figure includes Instagram.

Loftie continues to spend more money on Facebook than Amazon, but the equation has changed dramatically. In the days surrounding Black Friday in November, he allocated 10% of his marketing budget to Amazon, up from zero the year before. Facebook and Instagram fell to 40% of his budget from 71%. The rest of the money he pulled out of Meta went to Google, as he increased spending there from 29% over the holidays in 2021 to 50% last year.

Hassett said Facebook ads simply don’t work as well anymore, after the iOS update in 2021 began forcing app developers to ask users if they wanted to be tracked. With more consumers opting out of app tracking, the pool of potential customers has been “hollowed out and so we can no longer reliably target people,” Hassett said.

“Facebook has to serve the audience to a bigger pool of people in order to find the same people you’re finding before, and that’s just more expensive,” he said. “You have to pay a lot more than you did a year ago, and a lot of that is due to Apple’s privacy changes.”

Meta finance chief Susan Li told analysts on last week’s earnings call that growth in the company’s biggest verticals, online commerce and consumer packaged goods, “remained negative” in the quarter. She said the pace of the year-to-year decline in “online commerce has slowed compared to last quarter,” but was uncertain if the sector will significantly rebound anytime soon.

People take selfies in front of the logo of Facebook parent company Meta on November 9, 2022 in Menlo Park, California. Meta will lay off more than 11,000 staff, the company said on Wednesday.

Liu Guanguan | China News Service | Getty Images

For Loftie, Amazon and Google provide better value because a shopper is showing intent by searching for a particular item. Hassett purchased keywords like “white noise” as well as “Loftie” to make sure that consumers who wanted to find his products weren’t misdirected.

“The work we do off of Amazon on advertising definitely pays dividends on Amazon because people are going there and typing in Loftie,” Hassett said, adding that his shift in ad spending helped Loftie generate a record $250,000 revenue over a four-day stretch during the holidays.

Investment bank Cowen noted in a recent survey of ad buyers that “Amazon was the most popular survey response when we asked respondents which ad platform outside of GOOG / FB properties could emerge or is emerging as a meaningful part of buyers’ Digital ad spend, ahead of TikTok.”

The survey indicated that there continues to be “broad interest among advertisers” to grow their Amazon budgets in 2023, with 54% of surveyed Amazon advertisers saying they are planning to spend more this year than last.

While Facebook remains a core piece of a brand’s budget, its influence is diminishing, and the company’s investment in its TikTok-like Reels product will take a few years to make a significant financial impact, the Cowen analysts said.

“In the near term, we expect Meta ad share to decline further in ’23 given macro headwinds and the pivot to Reels,” they wrote.

A Meta spokesperson declined to comment for this story but sent CNBC examples of brands that the company says increased their allocation to Facebook and Instagram and have seen improved performance from ads on the site.

Like Loftie, Robin Golf also had to move away from Facebook in promoting its catalog of golf clubs and related equipment. CEO Peter Marler said over the past year more of that money has gone to Amazon.

Between July 2021 and the same month a year later, Robin’s cost to acquire a customer jumped 260% to $180 from $50, Marler said. He attributed most of the surge in costs to Facebook’s reduced targeting abilities, and said Google also wasn’t performing as well.

“We started investing more heavily in Amazon,” Marler said. “We shifted budget away from Facebook, we shifted budget away from Google, and we shifted to Amazon, and our Amazon sales have shot up by about 600% in 2022.”

Overall, the value of the tracking cookie has withered because of a renewed emphasis on consumer privacy. There are very few major online ad platforms that don’t rely on targeting, Marler said.

“Changes in the efficacy of those platforms really have forced us to reexamine our reliance on them,” he said. “We are actively moving our budgets away and decreasing the amount of money that we are spending with Meta.”

‘Not our customer’

Reliance on Amazon has its own pitfalls. The company is a dominant force in online retail and can make or break a brand’s success based on its performance on the site. That’s particularly risky because Amazon has its own ballooning private label business, which regularly rolls out products that compete with sellers on the platform.

Vitamin company Manna Health has been increasing its presence on Amazon, committing more of its ad budget to the site since the iOS changes, with plans to possibly double its allocation in 2023 from less than 10% currently, said marketing chief Ryan Farmer.

But he worries about brand loyalty, when so many transactions take place on Amazon.

“It’s not our customer, it’s Amazon’s customer,” Farmer said.

Farmer likens Amazon’s online ad system to Google’s in that companies run ads based on keywords that they think resonate with potential customers who may be searching for certain products. Manna also uses Amazon’s demand-side platform advertising tool, which is helpful for placement in banner ads that can be seen by people “searching for certain things,” Farmer said.

Manna, like Loftie and Robin Golf, maintains a customized Amazon home page that contains graphics, slogans, and a listing of the company’s various products that it’s selling on Amazon. However, the system is a “black box,” Famer said, because it doesn’t provide the kind of demographic data or other information to help Manna retain and nurture its customers.

Manna doesn’t even get contact information for the buyer. CEO Jeff Hill said he wished that Amazon offered “more insight into the customer, obviously, and sharing emails would be a bare minimum” so Manna could build a community and talk to clients.

“‘Hey, you bought this joint supplement, you know you might also be interested in our new bone supplement,” Hill said, describing a potential follow-up email. “It would help our company out and we would be able to buy more on Amazon and it would be mutually beneficial for us to make it to the customer and drive more traffic back to Amazon and the products.”

Amazon declined to provide a comment for this story.

Rachel Tipograph, CEO of marketing technology firm MikMak, said there are other unforeseen costs tied to Amazon advertising.

Unlike Meta, which just requires you to login to Facebook’s business manager to start buying ads, advertising on Amazon comes alongside listing products on the platform and a host of other services that brands are often buying, including warehouse space. Premium ad placement is the equivalent of slotting fees in retail stores, where brands pay for shelf visibility.

A Target customer looks at a display of board games while shopping at Target store on December 15, 2022 in San Francisco, California.

Justin Sullivan | Getty Images

Tipograph expects these costs will “cause the pendulum to swing back” towards brand promotion, and companies will rely more on channels that direct traffic to their own website and give them more control over their expenses.

“What CFOs want is profitable advertising, profitable growth,” Tipograph said, “and they want to know that they are driving incremental growth.”

Ryan Flannagan, the CEO of e-commerce marketing firm Nuanced Media, said that as Amazon’s ad business has grown, so has the competition to run “premium copy and visuals.”

Companies that aren’t investing in Amazon ads are “basically losing market share, because they’re not defending themselves,” Flanagan said.

Amazon has plenty of work ahead to keep its ad offerings attractive enough for brands to continue forking over bigger portions of their budget. But for now, companies like Loftie are happy with the returns they’re getting from Amazon, given the challenges with Facebook.

The way Hassett sees it, even with the rising expenses and associated risks, Amazon is providing enough value to justify the headaches.

“I think you have to be there,” he said.

WATCH: Facebook face-off: Who’s right on Meta?

Facebook face-off: Who's right on Meta?

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Former Myanmar colonel who once served as information minister gets 10-year prison term for sedition



Former Myanmar colonel who once served as information minister gets 10-year prison term for sedition

BANGKOK (AP) — A former high-profile Myanmar army officer who had served as information minister and presidential spokesperson in a previous military-backed government has been convicted of sedition and incitement, a legal official said Thursday. He was sentenced to 10 years in prison.

Ye Htut, a 64-year old retired lieutenant colonel, is the latest in a series of people arrested and jailed for writing Facebook posts that allegedly spreading false or inflammatory news. Once infrequently prosecuted, there has been a deluge of such legal actions since the army seized power from the elected government of Aung San Suu Kyi in February 2021.

He was arrested in late October after a military officer from the Yangon Regional Military Command reportedly filed a change against him, around the time when some senior military officers were purged on other charges, including corruption. He was convicted on Wednesday, according to the official familiar with the legal proceedings who insisted on anonymity for fear of being punished by the authorities.

Ye Htut had been the spokesperson from 2013 to 2016 for President Thein Sein in a military-backed government and also information minister from 2014 to 2016.

After leaving the government in 2016, Ye Htut took on the role of a political commentator and wrote books and posted articles on Facebook. For a time, he was a visiting senior research fellow at the ISEAS-Yusof Ishak Institute, a center for Southeast Asia studies in Singapore.

After the army’s 2021 takeover, he often posted short personal vignettes and travel essays on Facebook in which he made allusions that were generally recognized to be critical of Myanmar’s current military rulers.

The army’s takeover triggered mass public protests that the military and police responded to with lethal force, triggering armed resistance and violence that has escalated into a civil war.

The official familiar with the court proceedings against Ye Htut told The Associated Press that he was sentenced by a court in Yangon’s Insein prison to seven years for sedition and three years for incitement. Ye Htut was accused on the basis of his posts on his Facebook account, and did not hire a lawyer to represent him at his trial, the official said.

The sedition charge makes disrupting or hindering the work of defense services personnel or government employees punishable by up to seven years in prison. The incitement charge makes it a crime to publish or circulate comments that cause fear, spread false news, agitate directly or indirectly for criminal offences against a government employee — an offense punishable by up to three years in prison.

However, a statement from the Ministry of Legal Affairs said he had been charged under a different sedition statute. There was no explanation for the discrepancy.

According to detailed lists compiled by the Assistance Association for Political Prisoners, a watchdog group based in Thailand, 4,204 civilians have died in Myanmar in the military government’s crackdown on opponents and at least 25,474 people have been arrested.

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Top CIA agent shared pro-Palestinian to Facebook after Hamas attack: report



Top CIA agent shared pro-Palestinian to Facebook after Hamas attack: report

A high-ranking CIA official boldly shared multiple pro-Palestinian images on her Facebook page just two weeks after Hamas launched its bloody surprise attack on Israel — while President Biden was touring the Jewish state to pledge the US’s allegiance to the nation.

The CIA’s associate deputy director for analysis changed her cover photo on Oct. 21 to a shot of a man wearing a Palestinian flag around his neck and waving a larger flag, the Financial Times reported.

The image — taken in 2015 during a surge in the long-stemming conflict — has been used in various news stories and pieces criticizing Israel’s role in the violence.

The CIA agent also shared a selfie with a superimposed “Free Palestine” sticker, similar to those being plastered on businesses and public spaces across the nation by protesters calling for a cease-fire.

The Financial Times did not name the official after the intelligence agency expressed concern for her safety.

“The officer is a career analyst with extensive background in all aspects of the Middle East and this post [of the Palestinian flag] was not intended to express a position on the conflict,” a person familiar with the situation told the outlet.

The individual added that the sticker image was initially posted years before the most recent crisis between the two nations and emphasized that the CIA official’s Facebook account was also peppered with posts taking a stand against antisemitism.

The image the top-ranking CIA official shared on Facebook.

The latest post of the man waving the flag, however, was shared as Biden shook hands with Israeli leaders on their own soil in a show of support for the Jewish state in its conflict with the terrorist group.

Biden has staunchly voiced support for the US ally since the Oct. 7 surprise attack that killed more than 1,300 people, making the CIA agent’s posts in dissent an unusual move.

A protester walks near burning tires in the occupied West Bank on Nov. 27, 2023, ahead of an expected release of Palestinian prisoners in exchange for Israeli hostages. AFP via Getty Images

In her role, the associate deputy director is one of three people, including the deputy CIA director, responsible for approving all analyses disseminated inside the agency.

She had also previously overseen the production of the President’s Daily Brief, the highly classified compilation of intelligence that is presented to the president most days, the Financial Times said.

“CIA officers are committed to analytic objectivity, which is at the core of what we do as an agency. CIA officers may have personal views, but this does not lessen their — or CIA’s — commitment to unbiased analysis,” the CIA said in a statement to the outlet.

The top CIA official has since deleted the pro-Palestinian images from her social media page. Hamas Press Service/UPI/Shutterstock

Follow along with The Post’s live blog for the latest on Hamas’ attack on Israel

Neither the Office of the Director of National Intelligence nor the White House responded to The Post’s request for comment.

All of the official’s pro-Palestinian images and other, unrelated posts have since been deleted, the outlet reported.

Palestinian children sit by the fire next to the rubble of a house hit in an Israeli strike. REUTERS

The report comes as CIA Director William Burns arrived in Qatar, where he was due to meet with his Israeli and Egyptian counterparts and the Gulf state’s prime minister to discuss the possibility of extending the pause in fighting between Israeli forces and Hamas terrorists in the Gaza Strip for a second time.

Israel and Hamas agreed Monday to an additional two-day pause in fighting, meaning combat would likely resume Thursday morning Israel time if no additional halt is brokered.

Both sides agreed to release a portion of its hostages under the arrangement.

More than 14,000 Palestinians in Gaza, including many women and children, have been killed in the conflict, according to data from the Hamas-controlled Ministry of Health.

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Lee Hsien Yang faces damages for defamation against two Singapore ministers over Ridout Road rentals



Lee Hsien Yang faces damages for defamation against two Singapore ministers over Ridout Road rentals

High Court ruling: Lee Hsien Yang directed to compensate Ministers Shanmugam and Balakrishnan for defamatory remarks on Ridout Road state bungalows. (PHOTO: MCI/YouTube and ROSLAN RAHMAN/AFP via Getty Images ) ((PHOTO: MCI/YouTube and ROSLAN RAHMAN/AFP via Getty Images ))

SINGAPORE — The High Court in Singapore has directed Lee Hsien Yang to pay damages to ministers K. Shanmugam and Vivian Balakrishnan for defamatory statements made in Facebook comments regarding their rental of black-and-white bungalows on Ridout Road.

The court issued a default judgment favouring the two ministers after Lee – the youngest son of Singapore’s founding prime minister Lee Kuan Yew and brother of current Prime Minister Lee Hsien Loong – failed to address the defamation lawsuits brought against him. Lee had, among other claims, insinuated that the ministers engaged in corrupt practices and received preferential treatment from the Singapore Land Authority for their bungalow rentals.

The exact amount of damages will be evaluated in a subsequent hearing.

Restricted from spreading defamatory claims against ministers

Not only did Justice Goh Yi Han grant the default judgment on 2 November, but he also imposed an injunction to prohibit Lee from further circulating false and defamatory allegations.

In a released written judgment on Monday (27 November), the judge highlighted “strong reasons” to believe that Lee might persist in making defamatory statements again, noting his refusal to remove the contentious Facebook post on 23 July, despite receiving a letter of demand from the ministers on 27 July.

Among other things, Lee stated in the post that “two ministers have leased state-owned mansions from the agency that one of them controls, felling trees and getting state-sponsored renovations.”

A report released by the Corrupt Practices Investigation Bureau in June concluded that no wrongdoing or preferential treatment had occurred concerning the two ministers. However, Lee continued referencing this post and the ongoing lawsuits, drawing attention to his remarks under legal scrutiny.

Justice Goh emphasised that the ministers met the prerequisites for a default judgment against Lee. The suits, separately filed by Shanmugam, the Law and Home Affairs Minister, and Dr Balakrishnan, the Foreign Affairs Minister, were initiated in early August.

Lee Hsien Yang alleges in his post that two ministers leased state-owned mansions, 26 and 31 Ridout Road from an agency, one of which they control, involving tree felling and receiving state-sponsored renovations.Lee Hsien Yang alleges in his post that two ministers leased state-owned mansions, 26 and 31 Ridout Road from an agency, one of which they control, involving tree felling and receiving state-sponsored renovations.

Lee Hsien Yang alleges in his post that two ministers leased state-owned mansions, 26 and 31 Ridout Road from an agency, one of which they control, involving tree felling and receiving state-sponsored renovations.(SCREENSHOTS: Google Maps)

He failed to respond within 21 days

Lee and his wife, Lee Suet Fern, had left Singapore in July 2022, after declining to attend a police interview for potentially giving false evidence in judicial proceedings over the late Lee Kuan Yew’s will.

His absence from Singapore prompted the court to permit Shanmugam and Dr Balakrishnan to serve him legal documents via Facebook Messenger in mid-September. Despite no requirement for proof that Lee saw these documents, his subsequent social media post on 16 September confirmed his awareness of the served legal papers.

Although Lee had the opportunity to respond within 21 days, he chose not to do so. Additionally, the judge noted the novelty of the ministers’ request for an injunction during this legal process, highlighting updated court rules allowing such measures since April 2022.

Justice Goh clarified that despite the claimants’ application for an injunction, the court needed independent validation for its appropriateness, considering its potentially severe impact on the defendant. He reiterated being satisfied with the circumstances and granted the injunction, given the continued accessibility of the contentious Facebook post.

Lee acknowledges court order and removes allegations from Facebook

Following the court’s decision, Lee acknowledged the court order on 10 November and removed the statements in question from his Facebook page.

In the judgment, Justice Goh noted that there were substantial grounds to anticipate Lee’s repetition of the “defamatory allegations by continuing to draw attention to them and/or publish further defamatory allegations against the claimants.”

The judge mentioned that if Lee had contested the ministers’ claims, there could have been grounds for a legally enforceable case under defamation law.

According to Justice Goh, a reasonable reader would interpret Lee’s Facebook post as insinuating that the People’s Action Party’s trust had been squandered due to the ministers’ alleged corrupt conduct, from which they gained personally.

While Shanmugam and Dr Balakrishnan were not explicitly named, the post made it evident that it referred to them, and these posts remained accessible to the public, as noted by the judge.

Justice Goh pointed out that by choosing not to respond to the lawsuits, Lee prevented the court from considering any opposing evidence related to the claims.

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