Owned vs. Rented Audiences

Those of you who I have worked with in any capacity over the years have probably witnessed my enthusiasm regarding “owned audiences.” After a few recent conversations, I have come to the realization that a lot of people don’t actually know what this means, and I’ve honestly had trouble communicating the value in a few simple sentences. This is why I believe that we are overdue for a deep dive post on what “owning your audience” actually means and what risks you are exposing yourself to when you don’t. If anything, this will just act as a great reference point any time it comes up in the future. 

To fully understand an owned audience, you really have to look at its counterpart: a rented audience. Before we break down the differences, it’s important to note that the term “rented” can easily be taken out of context. It does not always imply that you are paying to use the audience (although it does in some cases). It simply means that access to the audience is controlled by a third party. Here is the proper definition of each: 

Owned Audience – This includes people who have opted in to receive communications from you directly, such as email subscribers, event attendees, community members, and customers. You have full control over how and when you communicate with them.

Rented Audience – This includes individuals who interact with your content through third-party platforms where you don’t have direct control over the audience relationship. Examples include people who follow you or see your posts on social media, visitors from search engine results, or viewers of content from which you advertise on.

Some people will say that social media followers are a form of owned audience. I personally don’t see it that way. This is because you can lose access to them at any point for reasons outside of your control. Understanding the difference here is what leads many people to realize that if their entire strategy relies around SEO, Social Media, and Paid Ads, then they own very little (if any) real estate in their own customer acquisition funnel. But given how common these tactics are, is this even a bad thing? 

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The Risks of Rented Audiences

Like most things, leveraging rented audiences is not a problem until it very much is. While I rarely take an overly pessimistic view on things, my opinions on this particular topic are influenced by the several events that I experienced throughout my career where this went wrong in the worst way, even despite following all of the rules of engagement. If you do anything long enough, you are going to have some level of exposure to the downside risks. This is why I want to take this opportunity to fully communicate what those risks actually are and how they could impact you:

Algorithm Updates

The largest risk that I see with rented audiences are algorithm updates. Whether it’s a social media platform, search engine, ad platform (or all three), you are ultimately relying on the consistency and reliability of their algorithm to deliver a similar result over time. While this is usually the case, there are occasional updates that almost always cause a major shock to the system. In most cases, these events negatively impact companies using the platforms more than they do the individual users. 

A great example of this is the major Facebook updates in 2012, 2014 and 2016 that reduced the reach of company pages from 16% of their audience, down to 2%. For context, this means if your page had 1,000 followers, your posts would only generate around 20 impressions on average. These updates appeared to follow the rollout of the “Boost Post” feature which was meant to make Facebook’s paid distribution more accessible, essentially converting it to a pay-to-play system. Given the visibility of this option, many small businesses (including those I marketed for) were investing heavily in social impressions to build a following, assuming they could then reach the audience for free after they’ve acquired them. As it turned out, that reach was throttled downward and despite the many thousands of dollars dumped into ads, these pages became almost useless for organic distribution. 

Feature Dependence

In terms of rented audiences, there is an interesting relationship between features and the algorithm that can be both a gift and a curse for marketing. Think of these algorithm updates as railroad switches as they divert attention from one place to another. Typically these tend to favor whatever new feature is trending on the platform. As a company promoting yourself on said platform, this can actually look like an opportunity, except when you are at the losing end of the fork. 

There is actually an example of this playing out right now as Facebook’s latest update has begun favoring posts made in “Groups.” For those businesses that were already heavily engaged in local community groups, or have built them themselves, they have no doubt been benefiting from this tailwind. This has also kicked off a bit of a gold rush with tons of new groups being created and over 100 million user group joins every single day. Before you rush to create a Facebook group, it’s important to understand that becoming dependent on this single feature is actually a risk. Once these groups reach their saturation point and start to create too much noise, the algorithm will be corrected and the railway switch will suddenly point in the direction of something else. The same can be said for LinkedIn Groups, LinkedIn Newsletters, Twitter Spaces, etc. Leveraging these features can be a smart idea, but becoming completely dependent on them without total control of the outcome is a risk. 

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Content Sensitivity

There are two trends that are beginning to intersect, which I believe creates a lot of risk for MSPs & IT Consultants on third-party platforms. The first is automated content moderation. The second is the prevalence of cyber attacks, both as a talking point for MSPs and as a threat to users of the platform. What concerns me is the algorithm’s inability to differentiate education from perpetuation as it tries to figure out who is a good actor and a bad actor (as they both are discussing the exact same topics). 

Some of you may recall that during the surge in remote work due to the COVID-19 pandemic, conversations about Zoom’s security vulnerabilities led to a wave of accounts being flagged or banned on social media platforms. Users reporting Zoom’s security flaws were suddenly facing suspensions because the automated moderation systems of these platforms misinterpreted technical discussions as spreading misinformation or causing alarm. As MSPs, we need to be more conscious of this and understand that even though we’re on the good side, that doesn’t make these topics any less sensitive. 

Policy Changes 

Another risk that MSPs need to be aware of is that given the increase in supply chain attacks and the risks that they pose, IT Providers could find themselves teetering on the edge of regulation. While I don’t think it will happen anytime soon, there might be a day where state or federal legislation is passed related to how these services can be advertised and delivered. In this case, MSPs would likely require some sort of license, specific language and/or proof of compliance in order to operate. From there it will not be long until these laws become reflected in the advertising platform’s terms of use, as they try to prevent advertisers from using their platform in an unlawful way. 

Unfortunately, I have first-hand experience with this. Back in the early days of Google Ads, I managed campaigns for companies in the Mortgage, Finance and Legal industries. As part of the cleanup of the mortgage meltdown of 2008, some states passed legislation that required very specific disclaimers be represented anytime you advertised a particular product or service. Since this was initially done at the state level, it wasn’t necessarily on everyone’s radar, until Google began enforcing the policies through their ad platform. As a result, ads that had previously been approved and running had all suddenly become disapproved and the sheer volume of these disapprovals triggered an automatic account suspension. It took over a month to actually learn what the issue was, find and update the disclaimers that were needed, and then get the account reinstated. By that time, several salespeople had quit out of frustration (no leads) and the company lost a ton of revenue. This is not to imply that MSPs are at risk of this right now, but the point is that it can and does happen more often than you think.

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IP Blacklisting & VPNs

A risk that probably does not get discussed enough is using a VPN service when accessing your accounts. As a matter of fact, I’m literally at a coffee shop right now, using a VPN as I always do when working out-of-office. The problem is that a lot of people use cheap VPN services for the wrong reasons (such as spamming via social and email), which leads to many of their IPs becoming blacklisted by these sites. If you don’t have a dedicated IP, it would not be far-fetched for your discount VPN service to assign you an IP that has previously been banned in some capacity.

Since social media sites use IP Blacklisting as a first level of defense against repeat offenders, you are running a risk just about any time you access your account via an IP address that you don’t know for sure to be safe. In the example of Meta, accessing your account from a banned IP on one app may even prevent you from accessing the other apps that they own. If you are the sole Administrator of your company’s Facebook page, this could even prevent you from being able to access and make updates on behalf of your business. Again, these are not things you typically think about, but it shows the risk exposure that you have when relying on rented audiences. 

Platform Gamification 

The final risk that I’d like to point out is the contradiction between the gamified reward system built into social media platforms and your objectives as a business using them. In an ideal world these two things would be perfectly aligned, but unfortunately that’s just not the case. Social media platforms are built to reward certain behaviors (reactions, engagement, reach) and in most cases, this aligns more with the wants and needs of the platform than it does that of your business. 

Many of you may remember the ridiculous viral LinkedIn post from a few months ago where someone tried to pass off their engagement photos as business advice. A look at your own post history will show you that your most personal posts on the platform will produce far more engagement and reach than something business-related (despite it being a professional network). While the representation of human emotion in an algorithm isn’t necessarily a bad thing, it can be if it doesn’t align with your objectives. If you were to continue to optimize for these rewards (as the guy from the viral post clearly has been), you may find yourself with a lot of engagement, but nothing to actually show for it. As hard as it is to fight against, we need to look at gamification as a risk and make sure that we are using these platforms to the benefit of our business in a way that is quantifiable beyond social metrics. 

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The Rent-To-Own Strategy

Rather than leave you with a bunch of negative sentiment, it’s equally important to talk about how we can hedge against the inherent risks and leverage these platforms to our advantage. I call this the “rent-to-own” strategy, because we’re effectively saying that the core purpose of using these rented audiences is to build an owned audience. While this may seem obvious, a lot of the behavior I see everyday contradicts it. 

For example, if you are currently trying to build a LinkedIn newsletter and have no plans to tie that back to an audience that you control, then you need to rethink your strategy. While this feature offers a great opportunity to nurture a rented audience, a better use would be to somehow integrate this into your core lead generation efforts. One way to do this would be to use it to distribute blog articles, while only offering a preview of the article in the LinkedIn newsletter, requiring the visitor to click through to read the entire piece. Assuming that your site is optimized to collect leads, this now achieves our goal of renting-to-own. Simply building a LinkedIn Newsletter audience for the sake of building it can help drive awareness and new business, however doing so in a silo leaves you exposed to the risks I’ve mentioned. You can have your cake and eat it too if you simply tweak your approach. 

Here are the key rules that I check myself against everyday to make sure that I follow this advice myself: 

Always Link Out

One of the most obvious violations of this rule is the act of creating content that leads to nowhere. I see this on LinkedIn all the time, as people create text or video posts ranting about a topic, but without that tying back to some form of action that the user can take (read an article, listen to a podcast, download a guide, register for an event, etc.) These are relatively easy, low-friction actions that can be stitched together which can make sure that no good rant goes to waste. Even if these don’t immediately convert to leads, they contribute to retargeting audiences, which then can be converted to leads later at a very low cost. So in my case, I just make sure that I am almost always linking out in anything I post, getting people off the platform that I rent, and onto the platform that I own. 

Optimize For Leads 

Not everyone will agree with this, but my approach to the majority of rented audiences that I use is to optimize for leads first and foremost. What I have found is that the correlation between the click-thru-rate and the engagement rate on a piece of content is weaker than you’d expect. To put this another way, just because someone liked your post, doesn’t mean they clicked through to read it. At the same time, a post that generates no engagement will often have less reach, however it could still generate a high click-thru-rate. This is where I see a lot of people leaving money on the table, as these posts could easily be turned into high performing ads to boost impressions, but since we listen too much to social engagement, they often just get buried in our feed never to be used again. At the same time, I also tend to optimize for leads over revenue when leveraging rented audiences. This is because I know that I can optimize for revenue later once they’ve entered an audience that I own. My goal is to get them into that audience as soon as possible, which is why optimizing for leads first fits the rent-to-own mentality. 

Diversify Platforms

Lastly, I try to always diversify the platforms, audiences, and features that I am using to make sure that I don’t ever get caught standing still. This is the fallacy of many marketing agencies (including my own many years ago). They tend to build a marketing system that works, create a process around that system so that it scales, and then they become stuck doing the same thing over and over in order to maintain a consistent product. In some cases, the platforms and features evolve faster than the agency does and while they’ve upheld the system that they have created, they’ve failed to realize that the railway switch is now pointing in another direction. This is why I personally am in a constant state of R&D. I want to make sure that I am leveraging these platforms in a diversified way, in many cases with one foot out the door onto the next thing. This is very difficult for most people who don’t dedicate their life to marketing, but it is the best way that I have found to offset the risks that I’ve described above. 

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If you only take one thing away from this article, it should be that we’ve become way too comfortable on other people’s platforms. The line between what we own and don’t own has become blurred. This may not matter much when we use these platforms for personal use, but as a business it matters a lot. A rent-to-own strategy allows you to ensure that you are constantly transferring the value from their platform, to yours. Afterall, if you are spending any amount of time and money on content creation and paid distribution, you should receive a return on that investment. At a minimum, that return should be reflected in the audiences that you own so that you don’t risk losing it before it can be converted to revenue.