Late last year Morgan Stanley estimated that Facebook would generate over $1 billion via video ads. This estimate was made was before Facebook ever had a video ad product. In light of this information, its not surprising to see Facebook prioritizing its video player and aggressively encouraging brands to invest in their platform.
It makes sense that Facebook would want to be a leader in digital video, but should brands join them there?
The digital video market is growing rapidly. Currently TV ad spending dwarfs digital video, with $68.54 billion spent on TV ads in the US vs $6 billion for digital video. However, this number only expected to grow, and grow quickly, this year alone there’s been a 56% increase in digital video advertising spends. It’s one of the few areas of social where Google beats Facebook.
Furthermore, all signs point to video being the future of media consumption. YouTube is huge with younger viewers, and has more millennial viewers than any cable network. For millennials the the next generation of stars are being born from YouTube. According to a recent survey, top YouTubers channels are more recognizable to teens than traditional celebrities.
Despite this, YouTube is potentially up for some stiff competition with Facebook entering the market. Advertisers have already invested millions in growing their Facebook Fans – far more so than they have in growing their YouTube subscribers. There are 41 brands in the top 100 most ‘liked’ pages on Facebook, while there are only 6 in the 100 most subscribed on YouTube. On Facebook top brands have tens of millions of fans (Coca Cola has 90 million for example), compared to YouTube where the most subscribed brand in the world is Red Bull with only 3.88 million subscribers. All of this is in spite of the fact that YouTube drives five times as much engagement for brands as Facebook.
Facebook is actively encouraging this commitment bias and are doing everything possible to make video on the platform enticing. Facebook autoplays video in the newsfeed, allowing brands to easily rack up high view counts much more easily than YouTube where a view is requires an actual click to play
The ability to quickly rack up high view counts is a powerful motivator—however spurious—and likely to get brands to reassess their video strategy and priorities. In fact, brands are already beginning to bite and aggressively move video to Facebook’s player. According to a recent AdWeek article,
“In January, McDonald’s posted 27 videos to Facebook, 18 of which were YouTube links and the rest native Facebook videos. In September, it posted 32 videos, of which 19 were Facebook videos. In May, Budweiser posted about 60 YouTube videos to Facebook, of which fewer than 10 videos used Facebook’s functionality; in September, those numbers flipped.”
Still, is Facebook video the smart move for brands? Earlier this year, after many brands had paid millions to acquire fans, Facebook decided to reduce the amount of organic reach that brands could generate via posts to their fans, and at the same time they introduced their ‘promoted post’ product. Suddenly, brands were required to pay Facebook to reach their fans at any meaningful scale. The trend of requiring brands to reach their fan bases is only continuing. Just this month Facebook announced that it is once again reducing the amount of organic reach brands can generate and will be limiting the number of “promotional Page posts” which appear the News Feed of users this coming January.
As a result of these tactics several brands and publishers have shut down their Facebook pages and left the platform entirely. Eat24 made headlines with its goodbye letter to Facebook after shutting down its page, stating that, “the bigger picture issue is that we can’t trust you. You lied to us and said you were a social network but you’re totally not a social network.”
While video views may be relatively easy to rack up on Facebook now? Who’s to say Facebook isn’t going to pull another bait and switch? Once brands have invested in developing their Facebook video strategy is the rug going to be pulled out from under them and will they be required to pay exorbitant fees for anyone to see their videos?
It looks as though the future of media consumption will be digital video and both Facebook and YouTube are vying to be the de facto platform in the space. However, which will be most beneficial to brands?
If the best predictor of future behavior is past behavior then brands would be wise to tread on Facebook with caution. While the quick gains in the form of autoplay views are alluring today, brands are likely going to have to pay dearly in the future.
Facebook has gotten away with this bait-and-switch time and time again, why would video be any different?
Brendan Gahan (@brendangahan) is a YouTube expert helping Fortune 500 brands with their YouTube influencer and community building campaigns. He was named Forbes 30 Under 30 in Marketing & Advertising and one of the 25 Top YouTube Business Power Players for 2013. Subscribe to his newsletter for whitepapers and case studies.