If you’re like millions of other businesses who operate and manage Facebook pages as a part of your online marketing activities, you were probably reviewing September analytics data a few days ago and noticed a distinct downturn in engagement and reach (both organic and viral) from the previous month.  In fact, they were probably WAY down.

Before you send a nasty email to your social media department, however, you should know that it’s probably not due to a sudden shift in the quality of their work – rather it’s almost certainly due to a September 20^th change in the Edgerank algorithm that Facebook uses to decide what a user will see in their newsfeed. Facebook’s most recent change to Edgerank is focused on reducing the number of organic brand posts that get displayed in a user’s newsfeed – it’s just the next step in Facebook’s desperate quest to increase revenue and justify their existence in the eyes of an impatient, demanding and profit hungry investor base.

For those of you who are unfamiliar with Edgerank and what it’s all about, you first have to understand that Facebook operates a lot like a search engine.  Just like Google tries to make decisions on which content is the most valuable to place at the top of their search results index, Facebook also tries to assess which content is most valuable to the viewer and then “rank” that content allowing the most valuable to ride to the top of the newsfeed.  Their ranking algorithm is called Edgerank.

Recently, Facebook made some significant shifts in how Edgerank works.  As a part of the most recent update, Facebook has decided to grow their revenues by changing the mix of content they allow to be shown in user’s newsfeeds. The newest Edgerank algorithm is now going to reserve 20% of the newsfeed content for paid sponsored stories and premium advertising.  A huge increase on how much paid content they previously allowed to enter the newsfeed.  What this means to businesses is that organic (unpaid) content wont rank as high as it did before in their audiences newsfeeds, in fact, lots of organic content will rank so low that it will never even be seen – thus the huge decrease in reach and engagement you’ve noticed in your recent Facebook analytics data.

So how much will this effect your Facebook community?

Plenty!  Edgerank Checker ran an analysis of 3,000 brand pages comparing data from the week before the change to the week after.  What they found was:

• Organic reach decreased an average of 25%
• Viral reach decreased an average of 45%
• Engagement decreased an average of 17%

In addition to the move to increase paid content in the newsfeed, Edgerank has also shifted to favor engagement more than ever.  That is the bright part of this story. While it’s clear that paid advertising and paid promotions on Facebook will be much more important in the coming months, there’s still another way to promote your content in your audiences newsfeed – and that’s to create content that garners more engagement than your competitors (i.e. more likes, more shares, and more comments).  Edgerank prioritizes high engagement content above low engagement content and while there are 20% fewer spots at the top of the newsfeed for organic posts, there will always be room at the top for the most “engaging” posts.

We suspect, as Facebook gets increasing pressure from investors to grow revenue through existing and new channels, they will continue to implement Edgerank shifts to force businesses to pay for more and more of the visible spots in their audiences newsfeed.

This will be a big blow to most social media marketers, but a boon for professional communicators who consistently produce valuable, engaging content on the social web.