How The New Instagram and Facebook Algorithm is Killing Small Businesses

Remember a month ago when everyone was panicking about the new Instagram algorithm that Facebook had previously adopted? We were worried that the new algorithm would affect the interaction we receive on our photos and how it might affect our businesses. Well, it's happening and it's KILLING retail sales for small businesses.
05/03/2016 11:15 am ET Updated Dec 06, 2017

Remember a month ago when everyone was panicking about the new Instagram algorithm that Facebook had previously adopted? We were worried that the new algorithm would affect the interaction we receive on our photos and how it might affect our businesses. Well, it's happening and it's KILLING retail sales for small businesses. I wanted to discuss this issue to ensure you that it's NOT YOU. Your product is as killer as ever and your creative integrity is still intact. You've seen a drop in sales and interaction on your photos because the system is broken.

The new algorithm changed the way that your followers see your posts (if they see them at all). Instead of loading your feed in chronological order with the posts from the users you follow, Instagram and Facebook now only show you the posts from the users you interact with most. I've tested this, I've seen the changes, and I've asked many outside parties if they have noticed a difference since the new algorithm was put into effect.

Who is it really affecting?

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Photo Credit: Johnathan Cardillo

  • Small Retail Businesses
It was literally like flipping a switch. Sales just dropped off of the map. Unfortunately, I know this from experience. 75% of my
were a result of my steady work and marketing on Instagram. Now, when I run a sale... people aren't seeing it. Pictures are getting fewer comments and likes and new followers are at a slow, painful crawl. Instagram claimed that the change was meant to show the user the 30% of photos that they actually interact with on a regular basis... Let's call a spade a spade here. The change was meant to frustrate business owners enough that they would turn to the option of paying for Instagram and Facebook ads.

I've paid for the ads and from my experience they weren't effective. Unless you have several thousand dollars to throw at ad campaigns on social media, you're not even making a dent. Small businesses just don't stand a chance. A classic case of a major corporation steamrolling the little guy. I took time to ask other small business owners what their experience has been since the change went into effect and the response was unanimous, "Instagram is dead." Trust me, I get it. You've spent years perfecting your feed and marketing campaigns, but unless the algorithm goes back to chronological order, you might be beating a dead horse.

  • Brand Ambassadors
What are brand ambassadors? They are usually models or influencers that have built a nice following for themselves. I'm sure you've seen them repping detox tea, jewelry, nutrition supplements, etc. Brand Ambassadors are usually approached by various companies to rep their product in exchange for a fee or free products. So, if your small business is already being affected by the new algorithm... this is a double whamy! Why? Because now your brand ambassadors are reaching a much smaller portion of their following as well. That means fewer people seeing your product. Your ROI (return on investment) just shrunk because your marketing dollars aren't doing what they used to do for you. If that's the case then brand ambassadors will become extinct in the very near future as will the companies that represent them, like
. It's a domino effect.

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Photo Credit: Johnathan Cardillo

  • Photographers
This change might affect photographers the most! Instagram is basically your online portfolio now. Gone are the days of emailing someone your portfolio. Within seconds they can look up your work on instagram and follow you for a possible future booking. However, if they aren't seeing your extraordinary work on a regular basis, you're out of sight and out of mind. People need to be reminded of why they love you. Everytime you post a picture of your work they fall in love with you all over again, and someday just might come back around to hire you for their own projects. That was the beauty of instagram before. Everytime you post a picture it's a soft touch. If they aren't seeing your work on a regular basis then that soft touch is gone, along with potential income.


What's the solution?

I'm afraid it's time to go back to the stone ages (not literally). You're going to have to pickup the phone and start dialing. Fill your calendar with networking events. The in-person touch goes a long way. I've read many articles discussing the negative impact that social media has had on brick and mortar sales... Well, that might turnaround soon if social media platforms keep moving in this direction. If your social media platforms are no longer a revenue generator then their is no sense in investing much time in them. Focus on your wholesale accounts and build that relationship.