Facebook's EdgeRank algorithm changes: How it works and why it's a good thing

Understanding how the algorithm works:

Knowing how the algorithm works will give you a better understanding on the why it works.

Before Facebook began making changes to their algorithm, they surveyed thousands of users to get a better understanding of what "high quality content"* means to them. Some of the questions they asked where:
• Is this timely and relevant content
• Is this content from a source you would trust?
• Would you share it with friends or recommend it to others?
• Is the content genuinely interesting to you or is it trying to game News Feed distribution?
*Source: News Feed FYI: Showing More High Quality Content

Based on these results, Facebook developed the algorithm to serve "high quality" content to users newsfeeds in rank order. The algorithm follows a complex system to decide ranking order, but simplistically it looks at the following criteria:

• How popular (liked, commented on, shared, clicked) are previous posts made by the post creator.
• How popular is this post with people who have already seen it.
• How popular have past posts been with the user?
• Does the post type (link, photo, status update) match previously popular posts with the user?
• How recently was the post published?
Granted, this system might not be perfect, but it is the basis on which the News Feed learns more about the user and how it supplies content that is deemed relevant.

Why the algorithm isn't a bad thing:

Although marketers and businesses have been scathing over the changes to the algorithm and watching their organic reach drop over the last couple months, it's actually a good thing in the long run.

If you look at Facebook as the universe with business/brand pages and friends content being smaller galaxies, it's easier to understand how much content is really out there - all vying for a place on the News Feed. The typical user will be exposed* to over 1,500 stories a day, which can be overwhelming considering that the average amount of time spent on Facebook is 37 minutes.
*Source Social Media Engagement: The Surprising Facts...

So it's important for Facebook to be able to deliver content and stories to users that are most important to them. You may have noticed resurfaced content on your news feed, which for some users could be frustrating, but it's just Facebook making sure that you saw those stories. It really wants you to be included in conversations your friends are having around popular articles and content.

The benefits for marketers and businesses

For marketers and businesses, this part of the algorithm is where you will see the most benefits. Although organic reach can be unpredictable, creating content that is valuable to your users will give you a better chance at reaching people in the News Feed. If you are creating content that your audience really want to see and engage with it will be pushed further into the brand/business galaxy by your current customers, potentially reaching like-mined prospective customers. Through this, Facebook are essentially helping you with customer driven marketing.

Analysing content posts and pushing "spammy", "like-bating" content further down the News Feed is also a good thing for brands and businesses as a whole. Because the competition is becoming so fierce for a position in the News Feed, marketers and businesses are being forced to spend more time on their content and content strategies. Meme's no longer make that marketing cut - and is that really a bad thing? As a user, I would appreciate having interesting, educating content on my News Feed more than a "like for 7 years good luck" image. Diversifying your content delivery by integrating other mediums (posting your images from Instagram) can also help making the content more interesting, while introducing customers to other elements of your online persona. Straying away from the stock standard link/image post can create more engaging content for your users, again sending you further into the galaxy.

Opening up new opportunities

Facebook is rewarding you for making valuable content. The algorithm is able to track how popular your post is (as explained above) and the more successful your post, the more popular you as a creator become.

Right now, you may not think it, but the algorithm actually opens up the playing field more. Brands and businesses that have been capitalising on these like-baiting tactics will no longer receive value from Facebook posting and will flood to other social networks and mediums. This works the same for users - If they are being flooded with useless content and not seeing the stories that interest them, they too will flee to some other network, and then what will marketers and business do?

In the bigger picture of content delivery on News Feeds, marketers and businesses may feel like they have been cheated out of a great system and are now being milked by the social media giant, but think of the way Google has developed and changed their algorithms to serve user queries better and how those changes impacted on SEO concepts and structures at the time.

Essentially Facebook are trying to create a better user experience by giving the people what they want: Valuable content.