Firm at Facebook’s mercy
Humor venture thrived on social network, until its host suddenly changed the rules.
Two friends started a greeting card company on the internet. It was cheap to launch and it instantly reached millions. Then one day without warning, Facebook changed the way it did business.
This is a story about survival in the age of Facebook, when a privately held algorithm can turn a beloved product into a hobby with no monetary value. Subplots include forays into alcohol, cheap laughs and low-paid freelancers.
Duncan Mitchell was a creative director at an ad agency in 2005 when his friend Brook Lundy, who worked at another agency, approached him with the idea to create online greeting cards. The ones available at the time seemed staid or unfunny. More salient, an e-card company, Blue Mountain, had recently been bought for stock and cash worth up to $1 billion.
“In the back of your head, especially back then, you’re like, Is this the next million-dollar idea?” said Mitchell, 48.
Mitchell was a graphic designer; Lundy had a way with words. At the very least, they thought, they could create cards for their friends.
“And at the very best we could leave our advertising jobs,” said Lundy, 46. “That was the ambitious side of us, that we could figure out this business that we knew nothing about.” Their product, they thought, was tailor-made for the social network of Facebook: fast, funny and intensely shareable.
What happened next, as the cards thrived and then suddenly withered on Facebook, illustrates the mercurial power of a new near-monopoly, with implications for all sorts of publishers and businesses, said Jonathan Zittrain, director of the Berkman Klein Center for Internet and Society at Harvard University.
“Facebook has grown at a pace and had an impact that it’s really hard to say anybody planned,” he said. “It isn’t just a mere commercial platform. It’s a place that people are turning to to get their sense of what’s going on in the world.
“That’s a combination that should be carefully navigated,” Zittrain said. “It would be awfully strange, back in the day, if the Yellow Pages rearranged themselves every other day.”
On a recent morning in New York, Lundy and five staff members gathered to discuss the state of traffic on Someecards.com. The offices were a kicky corporate WeWork space near Wall Street; the staff were mostly standup comedians and joke writers, mostly in their 30s.
“There’s good news,” said May Wilkerson, an editor on the site. “We’re at 18 million sessions for the month so far, up from 16.7 million at this point last month.”
What was drawing those users, though, was not e-cards but a stream of articles about things that were popular on the internet at that moment, including a celebrity’s new breast tattoo and a dermatologist who called herself Dr. Pimple Popper, with a 15-minute video of a “never ending” cyst doing — well, you can imagine what it was doing.
More than half a million people watched the video.
“Old reliable,” said Orli Matlow, one of the writers, noting that this was not the first time the company had posted videos from Dr. Pimple Popper.
Two writers in the room said they were physically repelled by the video. All agreed this was a good thing.
These hourly blog posts have replaced e-cards as the company’s main source of revenue. How long that will last before the company has to reinvent itself again is anyone’s guess.
For a humor company, the office was short on banter. The staff communicated mainly through the messaging app Slack. WeWork, with its cold brew iced coffee on tap, supplied a funnish workplace with no personal design touches, and Slack enabled camaraderie without actual discussions.
When the two friends started in 2007, with $350,000 in seed money, their plan was to produce e-cards, build a following and possibly sell to a larger company.
The first two steps came quickly. Using stock line drawings found on the internet, they wrote wry texts — an early favorite was, “When work feels overwhelming, remember that you’re going to die” — and posted them on Facebook. When people clicked on a card, it sent them to the company website, which contained paid advertising. Within a year, the site was drawing 1.5 million visitors a month. The founders hired more writers. Traffic to the site reached 5 million visitors a month.
Then four years ago, something changed. Cards that might once have reached 200,000 people were suddenly reaching only a few hundred, Mitchell said.
By then, Facebook had become the equivalent of television in the 1960s, said Nicole Ames, who runs a digital marketing firm called Twist IMC. “It’s the biggest dog on the porch,” she said. But for the companies that grew there, she said, it was impossible to know what formula it used to determine which posts appeared in users’ news feeds. When Facebook cut down on images that directed users to other sites, companies like Someecards were blindsided.
“You spent years building up this organic following, and now your content no longer shows up unless you pay,” Ames said. “I tell clients all the time, you play in Facebook’s playpen, and if they change something, it’s their game, it’s their rules.”
Although e-cards remain popular, they now mostly provide an identity for the company, distinguishing it from other internet humor sites, Mitchell said. Freelancers submit texts for cards and earn $25 for each one chosen.
“Twelve million people can look at them on Facebook, but we don’t make any money from that,” Mitchell said. The company tried to sell the cards for a while, but there was not enough interest. Instead, the staff uses the Someecards style to create branded advertising for Showtime, Splenda and other clients, relying on Facebook shares.
“If we can make you happy enough to share it with your friends, then your friends will be advertised to, and you’ll be advertising,” Mitchell said. “Facebook’s algorithm plays to that, too. If we post this and people don’t like it, it goes away. We need you to share.”
Mitchell and Lundy are now trying to plan for the next time Facebook changes its rules. One idea rolled out last year was a line of wines called Some Wine, with labels resembling the cards. An inexpensive red blend, for example, is labeled “This wine goes great with more of this wine.”
Lundy said he had given up worrying about the uncertainty because there was nothing he could do about it. But Mitchell pointed to a recent experiment in six countries in which Facebook stopped including posts from publishers in users’ news feeds, relegating them to a separate feed. Companies lost most of their readership overnight, Mitchell said.
“Google and Facebook have so much power,” Mitchell said. “When they make these changes, you have to be ready and have ideas. There could be a day where we’re out of ideas. Hasn’t happened yet. So I worry about it. I try to keep that concern in that place that doesn’t paralyze you but keeps you motivated to keep doing new things.”
In the meantime, the company survives by Facebook’s algorithms and the tastes of the American public, which turns out to favor a vivid dermatology video.
“I’ve had friends complain,” Mitchell said. “And I don’t look at Dr. Pimple Popper. But all I can say is, the way Facebook works, if you people out there weren’t clicking on Dr. Pimple Popper, it wouldn’t be there.”
This, he said, is a winning formula, at least for now.
“Somebody is watching that stuff, and a lot of people are watching it,” he said. “So that’s that.”
Two writers in the room said they were physically repelled by the video. All agreed this was a good thing.