Mar 7, 2023, 12:14 AM ETInterview

Meta CMO Alex Schultz: Competing Against TikTok & Snap; Why Reels Failed at First | E985

Alex Schreuder launched paper airplane websites at age 13 on GeoCities, leveraging early SEO tactics like high-frequency keyword stuffing to rank on AltaVista.
He transitioned from traffic generation to monetization by utilizing Yahoo Directory backlinks to achieve #1 Google rankings and running eBay affiliate campaigns on credit cards.
Schreuder joined eBay directly after demonstrating self-generated affiliate revenue, despite initially planning a PhD in physics at Cambridge.
He joined Facebook (Meta) in 2007, working alongside key figures like Javi Naím and Danny Ferranti to scale the platform from millions to billions of users.

The critical strategic pivot at Facebook was shifting focus from raw user acquisition to retention, driven by the insight that churn and resurrection numbers vastly exceeded new registration numbers.
Schreuder's team implemented "Growth Accounting," a model where Net Growth = Registrations + Resurrections – Churn, which reoriented strategy away from "virality at all costs."
A parallel strategic shift occurred at eBay to prioritize "activated confirmed registered users" (those who bid, buy, or list) over simple registrations, which required changing affiliate landing pages from registration forms to search results.
The specific "North Star" actions correlating to retention vary by product: friending for Facebook, sending messages for WhatsApp, following for Instagram, and placing bids for eBay.
Schreuder argues that while "speed of execution" is vital, being "patiently right" by waiting for sufficient data to make a correct strategic pivot is often superior to rushing.

Instagram Reels development involved multiple failed iterations; the first attempt to integrate it into the Stories slot failed, but subsequent pivots to a standalone feed eventually succeeded.
Schreuder acknowledges Instagram Stories was a reaction to Snapchat but emphasizes that Meta launched its version before Snapchat launched Stories, challenging the "copycat" narrative.
The separation of Facebook Messenger from the main app was driven by data showing that users expected instant responses only when using a dedicated app, whereas in-app DMs were perceived as asynchronous.
The Messenger split was tested in countries like Portugal, Romania, and Hungary; despite an initial dip in usage, a rebound occurred as user expectations for instant messaging aligned with the new app experience.
Schreuder admits moving too slowly on the Messenger split was a personal mistake, noting that while the data was clear, he hesitated to make the final decision due to a fear of insufficient data.

A "self-serve" advertising pivot at Facebook was catalyzed by a mistranslation in French where "create an ad" yielded 30-40% higher advertiser growth than "advertise," proving the value of small business empowerment.
Schreuder argues that metrics are never perfect descriptions of goals and warns against "Goodhart's Law," where a measure ceases to be a good measure when it becomes a target.
He advocates for a "hybrid" advertising funnel where self-serve tools attract small businesses, which are then nurtured into larger accounts by direct sales teams.
The culture at Meta encourages experimentation and avoids blame for honest mistakes, with "blameless post-mortems" (SRE reviews) used to learn from failures rather than punish them.
Leadership is encouraged to give direct, honest feedback even when uncomfortable, as delaying hard conversations is considered more damaging to the employee than the truth itself.

The rebranding to "Meta" was executed in three weeks to resolve consumer confusion between the corporate entity and the Facebook app, particularly regarding privacy and data sharing.
The new branding strategy aims to decouple the corporate identity from social media, allowing it to encompass diverse innovations like the Metaverse, VR, and privacy-focused tools like WhatsApp.
Internal processes ensure knowledge transfer between silos (e.g., Facebook, Instagram, Reality Labs) through weekly analytics reviews and cross-app leadership roles, such as Adam Mosseri leading Reels across the company.
PwC metrics indicate a significant improvement in Meta's perceived future potential post-rebrand, moving from 49th to 4th in company reputation rankings.

Schreuder came out as gay twice: first at university and again at Facebook after witnessing senior leadership (including Blake Ross) publicly support the LGBTQ+ community.
He spent a period at eBay "in the closet" due to concerns about the political climate in California (specifically Prop 8), describing the experience as psychologically destructive.
He identifies the transgender community as facing the hardest challenges within the tech industry and notes a significant gap in LGBTQ+ representation on corporate boards and executive teams.
His parents, despite an initial period of mourning their version of his future, became highly supportive after he came out.
He credits his father for teaching him "patiently right" listening skills and the value of doing what is right even when it is difficult.

Schreuder's primary goal for the next five years is to transform Reels from an engagement driver into a major monetization engine.
He aims to establish a proof-of-concept for the Metaverse, grounding it in virtual and mixed reality experiences with augmented reality as a future horizon.
The organization expects to move toward full legal compliance with emerging social media laws regarding content moderation and user well-being as societal norms settle.
He foresees a shift where the company focuses less on "shipping" features and more on celebrating "winning" outcomes where users successfully monetize and connect.