Snapshot: The challenges and opportunities of Facebook for businesses

While most businesses know they should create and maintain a Facebook presence, the world's largest social network still presents real challenges alongside its enormous opportunities.

Facebook reached approximately 3.07 billion monthly active users as of 2025, making it the most-used social platform on the planet by a wide margin. YouTube is a distant second at roughly 2.5 billion MAU. That scale means the biggest promise of Facebook for any business is still what it has always been: unmatched potential audience reach.

But scale alone does not make Facebook a simple platform to navigate. Organic reach has collapsed, ad costs have climbed, and the algorithm continues to shift. Below, we examine the current opportunities and challenges of Facebook for small and medium-sized businesses.

Opportunity #1: Facebook's audience targeting

Facebook's advertising platform offers some of the most sophisticated audience targeting available to businesses of any size. The Meta Ads system, which covers both Facebook and Instagram, allows advertisers to reach people based on age, location, gender, interests, behaviors, life events, and detailed demographic data.

When creating a Facebook ad, you can target in three primary ways:

• Core audiences: Define your target audience based on criteria like age, geography, gender, interests, and behaviors.
• Custom audiences: Reach people who have already engaged with your business, whether through your website, app, customer list, or previous ad interactions.
• Lookalike audiences: Reach new people whose interests and behaviors closely match those of your existing customers, letting you scale proven audiences efficiently.

Find out more about Facebook's ad targeting capabilities. The system has become substantially more AI-driven in recent years. Meta's Advantage+ campaign products now automate much of the targeting and placement work, using machine learning to find the most responsive audiences within parameters you set. For many advertisers, Advantage+ campaigns have outperformed manually targeted ones.

Beyond paid targeting, Facebook also offers Audience Optimization for organic posts. A Facebook Page can add interest-based tags to help surface posts to the users most likely to engage with them. For example, a sports post might include tags for the league, team, and players in the story. Adding these tags helps Facebook prioritize your content for relevant users without limiting your overall reach.

For guidance on getting more from your Facebook ad targeting, see our post on the 13 biggest mistakes businesses make on Facebook and our 6 Facebook marketing tips you should know.

Challenge #1: Organic growth of Facebook Pages

One of the most persistent challenges on Facebook is building an organic following from scratch, and maintaining meaningful organic reach once you have one.

The average Facebook Page post now reaches only 2 to 5% of its followers organically, down from 16% in 2012 and around 6% in 2014. Some studies put the 2024 average even lower, at 1.37%, according to Social Status data cited by Hootsuite. A page with 100,000 followers can realistically expect a typical post to be seen by 2,000 to 5,000 people without any paid promotion.

Growth is equally slow. Building a Facebook Page following is a long process, and it has become harder each year as competition for News Feed space intensifies. This makes a thoughtful, consistent content strategy more important than ever: when only a fraction of your followers see each post, every post has to earn its place. Avoiding common Facebook page mistakes matters far more when your organic runway is this narrow.

Opportunity #2: Low barrier of entry to advertise on Facebook

The cost to create a Facebook ad is zero. Creating a Meta Business account, building a campaign, and setting up your creative costs nothing beyond your own time.

Beyond that, the amount you spend on any Facebook ad campaign is entirely under your control. You can set daily budgets as low as $1, choose between cost-per-click and cost-per-impression models, pause campaigns instantly, and scale up or down based on performance. That level of flexibility makes Facebook advertising accessible to businesses of every size, from a one-person local operation to a multinational retailer.

Facebook has approximately 10 million active advertisers each month, operating across more than 190 countries, and 93% of social media marketers use Facebook for paid advertising. The platform's scale and targeting depth mean that even small budgets can generate measurable results if the audience definition and creative are strong. See our 6 tips to maximize your social media advertising budget for guidance on spending efficiently.

Challenge #2: Rising ad costs

While the barrier to entry remains low, the cost of reaching people on Facebook has climbed significantly in recent years and the trend continued through 2025.

According to Triple Whale's 2025 Meta ad benchmark analysis, every single industry saw CPM (cost per 1,000 impressions) increase year-over-year, with a platform-wide increase of 20%. The median CPM across industries sat at $13.48. Other analyses found CPM rising 81% year-over-year to an average of $19.66 in 2025 in some markets and verticals. Cost per click for traffic campaigns averages around $0.70 to $1.72 depending on industry and objective.

The drivers of rising ad costs are structural: more advertisers competing in the same auction, AI-driven bidding systems that optimize aggressively, and continued growth in ad inventory consumption. The practical implication for businesses is that Facebook advertising is no longer a low-cost channel in the way it was five to seven years ago. Efficient targeting, strong creative, and regular optimization matter more than ever to maintain an acceptable return on ad spend.

Opportunity #3: The power of video on Facebook

Facebook is a deeply underappreciated video platform, and that gap between reputation and reality represents a real opportunity for businesses.

Video now accounts for more than 52% of all content consumed on Facebook in 2025, up from 47% in 2023, and users watch more than 140 billion video views on the platform every month. According to Meta's own earnings commentary, Facebook and Instagram users spend more than 60% of their time on the apps watching video. Native Facebook videos achieve roughly 10 times more reach than YouTube links shared on the platform, because Facebook's algorithm strongly favors content that keeps users on Facebook rather than clicking away to external sites.

Facebook Reels, the platform's short-form vertical video format, now account for more than 25% of all video impressions on Facebook and generate higher engagement than static posts or link posts. Reels achieve an engagement rate of 0.23%, compared to 0.17% for video ads, 0.08% for photos, and 0.07% for text posts. Facebook Live continues to outperform pre-recorded content for interactions and comments. One practical note: approximately 85% of Facebook videos are watched without sound, so captions and on-screen text are essential for any video content intended to communicate information.

For businesses that can commit to regular short-form video, Facebook Reels and native video represent one of the few remaining areas where meaningful organic reach is still achievable without paid promotion. For more on video formats to consider, see our guide on 10 types of videos you can use in your marketing strategy.

Challenge #3: The limited reach of organic content from Facebook Pages

Any honest assessment of Facebook's challenges for businesses has to address the platform's algorithm and how dramatically it has reduced the organic reach of Page content.

The Facebook algorithm is the backend system that determines what appears in each user's News Feed, and in what order. Since Facebook went public and shifted to optimizing for advertising revenue, the algorithm has consistently deprioritized content from business Pages in favor of content from friends, family, and Groups. The 2018 algorithm update, which explicitly elevated personal connections over Pages, was the most significant shift, but the compression of organic reach has continued steadily since then.

Facebook's organic reach was around 16% in 2012. By 2025, it had fallen to between 1 and 2% for most Pages. In 2025, the algorithm further reduced reach for posts containing external links, since every click away from Facebook reduces time on the platform. Posts that keep users on Facebook, such as native video, text posts, and photos, consistently outperform those with external links.

The practical reality is that Facebook should increasingly be treated as a paid platform with organic content serving as a foundation for community building, rather than a primary traffic or lead generation channel on its own. Organic posts build familiarity and engagement with existing followers. Paid promotion is how you scale that reach to new audiences. Understanding your Facebook metrics helps you identify which organic content is worth putting paid dollars behind.

Opportunity #4: Facebook Marketplace and social commerce

Facebook Marketplace has grown from a peer-to-peer classifieds feature into one of the largest commerce platforms in the world. More than 1.1 billion users across 228 countries access Facebook Marketplace every month, and it commands a 51% share of the global social commerce market. There are an estimated 250 million sellers on the platform globally.

For businesses, particularly those in retail, home goods, automotive, and local services, Marketplace represents a significant and underused opportunity. Over 33% of small businesses in the U.S. use Facebook Marketplace to sell products, and roughly 16% of all Facebook users log into the platform specifically to browse Marketplace listings. Alongside Marketplace, Facebook Shops allows businesses to build a storefront directly on Facebook, creating a seamless path from ad or Page to purchase without the user ever leaving the platform.

Social commerce on Facebook and Instagram combined is projected to generate $94 billion in revenue, with 62% of U.S. shoppers reporting they have used Facebook for online shopping. Adding product listings to Marketplace, enabling Facebook Shops, and integrating product tags into organic content and ads are all low-friction opportunities to capture purchase intent directly on the platform.

The bottom line

The challenges of Facebook are real and have intensified: organic reach is near historic lows, ad costs are rising, and the algorithm continues to compress the visibility of Page content. But the opportunities are also real and substantial: unmatched global reach, the most sophisticated self-serve advertising platform available to small businesses, powerful video performance, and a growing social commerce ecosystem.

The businesses that succeed on Facebook in 2025 and beyond are those that treat it honestly: as a primarily paid platform for reach and acquisition, with organic content serving community building, video Reels driving incremental organic reach, and Groups providing the engagement depth that Pages no longer can. A thoughtful strategy, not just a presence, is what makes the platform work.

For more on building that strategy, see our guides on 6 Facebook marketing tips you should know, the 13 biggest mistakes businesses make on Facebook, and what every startup company should know about social media. DailyStory helps businesses connect their social media efforts to broader marketing automation, email, and SMS campaigns so every channel works together. Schedule a free demo to see how.

For a broader view of how Facebook compares to other platforms your target audience may be using, see our guide to choosing the right social media platform for your company.