With ad inventory in the main News Feed expected to “run out” by summer this year, Facebook is working hard on building additional ad revenue sources, including the new dedicated video tab on mobile, mid-roll video ads, Instagram ads and Messenger ads. Facebook TV is coming… as is Facebook Radio?! (“Run out” simply means demand will start to exceed supply, therefore the need for additional places to attract users!)
INSTAGRAM AD REVENUE
Instagram has become an increasingly important part of Facebook’s ad strategy. With 600M users, Facebook recently started allowing ads in Instagram Stories. Instagram is expected to generate $3.64Bn in worldwide revenue, a whopping 96% increase over last year!
Facebook recently started testing News Feed style ads inside Messenger on the app’s home screen. Facebook stated,
“The test group of people in Thailand and Australia will start to see these ads in the coming weeks.”
- Testing ways for people and businesses to engage on Messenger – Messenger Blog
- Facebook tests putting its news feed ads in Messenger to make app more plug-and-pay for brands – MarketingLand
Btw, the home screen of the (new-ish) Messenger includes your Favorites, Active Now, Birthdays, etc. Personally, I really dislike chopping up my inbox this way and tend to tap the three wee dots to hide those sections and go back to one big inbox!
Facebook is starting to allow publishers to finally monetize videos with mid-roll ads. A recent tweak to News Feed gives priority to longer videos. (How long is longer? It depends! Could be at least two minutes and as much as an hour or more.)
Facebook plans to fund original “TV” shows. Facebook’s chief of global creative strategy, Ricky Van Veen (College Humor co-founder) stated in December 2016:
“Earlier this year, we started rolling out the Video tab, a dedicated place for video on Facebook. Our goal is to kickstart an ecosystem of partner content for the tab, so we’re exploring funding some seed video content, including original and licensed scripted, unscripted, and sports content, that takes advantage of mobile and the social interaction unique to Facebook. Our goal is to show people what is possible on the platform and learn as we continue to work with video partners around the world.”
Fascinating times, yes?!
More reading at:
Netflix currently leads the way with 35.15% share of downstream traffic on the Internet in 2016, with YouTube at 17.53% and Amazon Video at 4.25%. Amazon’s share DOUBLED in one year. Look out, Facebook will soon enough start showing up in these streaming video percentages.
Source of stats by eMarketer at Scott Monty: http://www.scottmonty.com/2016/08/live-video-whats-old-is-new-again.html
Facebook invested nearly $50M in 2016 paying close to 140 media companies and celebrities to create content using Facebook Live. Now, it seems those contracts are not being renewed and Facebook is deemphasizing Live video in talks with these previously paid publishers. As Recode says,
“Instead, Facebook is pushing publishers to create longer, premium video content as part of a larger effort led by Facebook exec Ricky Van Veen. The hope is to get more high-quality video onto the platform and into your News Feed — the kind of stuff, presumably, you might find on Netflix.”
Mark Zuckerberg insists that Facebook is a TECH company, and won’t become a media company. Hm, we’ll see! 🙂
Facebook is working on a new feature called “Collections” (similar to Snapchat’s Discover section), that will showcase lists of curated content from publishers directly in the News Feed.
Btw, do you miss your Facebook Interest Lists? There may be more behind the reason Facebook retired this feature back on November 18, 2016. Yes, ‘not enough’ users took advantage of the feature. But, more likely, this Collections feature is in the works now and there is a monetization element coming. Will only paying publishers get featured in Collections? Will ads come to Collections? We’ll see.
Two other major Facebook owned potential growth drivers include:
WhatsApp will apparently roll out its chat bot platform for businesses later this year — this should be interesting!
Oculus is working on an untethered VR headset to help break into the mass consumer market.
For key expected numbers for Facebook’s Q4 2016 earnings report, see this Business Insider article.
“I’m joining Facebook to lead global music strategy and business development.”
Facebook revenue chart = BI Intelligence
Zuck = Stephen Lam/Reuters