The Consumption Principle

A simple rule for inferring how social algorithms work

We recently onboarded some new graduates to our team at Monolith. As part of their training process, we gave them our process on how to structure campaigns in various advertising platforms and taught them how to optimize it.

This led me to try to check if there's a generalizable idea that applies for all. It's not CTR% as not all ad placements have a way to click (e.g. Youtube Ads). It's also not Engagement as not all ad platforms allow reactions or comments.

One interesting idea, however, is what I call the "Principle of Consumption". The principle of consumption states that the best way to understand how a platform algorithm works is to identify how its users derive value from the platform. The way you can apply this principle is that whenever you're creating ad content, it must maximize the likelihood of consumption.

Let's look at some examples to illustrate how this works in practice:

For YouTube Ads and TikTok Ads, the way folks derive value from the platforms is by consuming videos. So it’s natural to assume that the main consumption metric to optimize for is the Watch Rate.

The watch rate is the percentage of the video the average user has watched. This means that when optimizing for such channels, it's important to create engaging videos that will keep users watching until the end. You can’t just repurpose a TV ad into Youtube or TikTok.

Facebook and Instagram are a bit different in that their primary consumption metric has changed over the years. Prior to 2018, reactions and comments was the main consumption metric for these platforms.

However, with the introduction of Stories and Instagram Reels, the "see more" rate (read more of the text) and the thumb stop rate (stopped and watched the video) have become more important metrics to track and optimize for. These metrics can be derived through custom metrics in the Business Manager and can be used to make informed decisions about your ad campaigns.

For example, if you notice that a certain post has a high see-more rate but a low thumb stop rate, you may want to experiment with changing the thumbnail or changing the hook or headline to see if you can get more people to stop scrolling and consume your post more.

Even for platforms that don't exist yet, the principle of consumption can be applied.

For example, if Clubhouse were to create its own ad platform in the future, it would likely incentivize ad content that maximizes listen rate.

A parting exercise for the reader: if Telegram were to offer businesses the option to have branded stickers, branded emojis, business group chats, and banner ads, what would be the best one to choose and why?

You’ll see that the consumption principle is broadly applicable, and allows you to adapt to any ad channel or marketing channel as you see fit.