Will Facebook Overtake TV?

Will video ads on Facebook draw dollars from traditional TV? The social network is making a push.
Matthew Klein
April 24, 2015 - 4 min. read

Over the last several months, Facebook has made some tweaks to its pitch to advertisers.

Specifically, they’re going to great lengths to explain the advantages of news feed video ads to the brands they work with.

Video ads on Facebook have been around since 2013. Major brands have run video ad campaigns on the network since then, but right now, for most users, video ads are only an occasional  feature in the news feed.

It seems as though this is poised to change, and soon.

The conditions are certainly right, as Facebook has pointed out. There’s been a precipitous rise in video posts and views online in general and on Facebook in particular.

There’s been a 133% rise in digital video viewing year over year (2014 to 2015). On Facebook alone, users are watching over three billion videos a day (65% of which are on mobile). We’ve seen, fairly recently a trend towards social TV, and the rise in content production from players like Netflix and Amazon, as opposed to traditional television networks.

People are now watching 76 minutes of video online a day. TV advertising spend will total 70.6 billion dollars, while digital video ads will draw a mere 7.8 billion. While audiences are still spending more time watching traditional TV (4 hours, 15 minutes a day), spending is higher there proportional to time spent than it is on digital video.

It looks like Facebook wants to correct this imbalance, and they’re making a major push to do it on multiple fronts.

Not a Bad Pitch

The company’s message, is basically that companies will get better results from running Facebook video ads, or Facebook video ads in combination with tv, than they would from running campaigns on TV alone.

The evidence that Facebook has put together for its case is looking pretty solid.

The first prong of the argument that buying videos on the network will allow brands to increase the reach of their ads significantly compared to just buying TV spots.

The company gives the example of Microsoft. Microsoft ran a four day campaign around the Super Bowl. According to Facebook, Microsoft managed to increase the reach for its campaign from 35 to 57 percent of all 18- to 49-year-olds.

And, on top of that, they say that Facebook video ads will perform particularly well among coveted younger demographics. On that Super Bowl campaign, Facebook says that Microsoft managed to increase its reach among 18- to 20-year olds from 21% to 51%.

Tracking impact too

To prove impact, not just reach, Facebook commissioned ratings agency Nielsen to look at the effectiveness of video campaigns on the network. They studied how video viewing affected three metrics, ad recall, brand awareness and purchase intent.

Controlling for the likelihood that users who were already familiar with a brand would be more inclined to watch an ad from them, they still saw a significant positive impact on ad recall, brand awareness and purchase intent from video watchers. The most significant impact was seen for people who watched ads all the way through to the finish, but as Facebook points out, there was still a considerable uptick in all these metrics for people who viewed for ten seconds or less.

video ads on Facebook

Better targeting than TV?

They’re also touting the network’s ability to do two related things that can be a challenge on TV: The first is remarketing, serving ads to people that have already visited a brand’s site, who have a much higher probability of purchasing. The other is sequencing. When remarketing, Facebook allows brands to show ads in the sequence they want. According to Facebook’s tests, showing video ads followed by static photo ads, where the photo ads had a call to action, resulted in a higher conversion rate than any other ad sequence.

And, finally, Facebook hopes that advertisers will be convinced that they will get more for their money from Facebook video ads than they would from a traditional TV campaign because the cost of video ads on Facebook is tied to how relevant the ads are for those users. People have argued that traditional television networks are hobbling themselves by not doing something similar, and that this ability will accelerate the ability to siphon off their ad dollars.

Social video ads catch up with social video

The rise in video content and views on Facebook seemed to happen overnight. Very quickly, the way people interacted with their news feeds changed, especially on mobile. Maybe because it happened so fast, it was easy to miss that those videos weren’t really accompanied by a rise in video ads.

Facebook’s new pitch signals that a new era is here. For brands, this could require an even bigger investment in video content—with Facebook’s targeting options personalized video ads are possible, and may have a big payoff. Users will probably see a major uptick in video ads, but ads as a percentage of the news feed likely won’t increase so much.

As social networks become more of a content delivery engine and as television becomes more connected, they will resemble each other more and more. This push from Facebook will likely make that change happen even faster.


Photo Credit: Gustavo Devito

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