Facebook reported its Q3 2015 results on Wednesday. And Alphabet announced Google’s Q3 2015 results two weeks ago. So, video marketers now realize what we’re facing. That’s right, it’s a two-party system!
Since we've already taken a look at what Google had to say about “the amazing momentum that YouTube has in mobile,” let’s take a look at what Mark Zuckerberg, Facebook’s CEO, and Sheryl Sandberg, Facebook’s COO, had to say about video during Facebook’s third quarter earnings conference call. You know, just as the old fairness doctrine required TV and radio broadcasters to give equal time to opposing views.
8 Billion Video Views on Facebook Every Day
Zuckerberg opened the conference by confirming that 1.55 billion people now use Facebook every month, and stated some other amazing stats for the site:
- More than 1 billion people use Facebook every single day
- 1.39 billion people now use Facebook on mobile devices, including more than 1 billion on Android
- There are 8 billion daily video views on Facebook
- More than 500 million people watch videos on the site daily
- In September 2015, over 1.5M small businesses posted video to Facebook, including native uploads and video ads.
Zuckerberg wanted to make it clear that Facebook is focused on investors, who are focused on advertisers, who are focused on reach – particularly mobile reach. It's clear that he wants video advertisers to use “views” as a standard metric, even though comparing YouTube views and Facebook video views is like comparing apples to oranges. I’ll circle back to this theme later in this column, too.
Facebook Video Views vs YouTube Video Views
Zuckerberg also stated that new video tools for Facebook pages are live, and that the site has been testing a dedicated video section. He confirmed that:
"Over the next few years, video is going to be some of the most engaging content online. And by continuing to innovate here, we have a chance to build the best place to watch and share videos”.
Yep, he just declared war on YouTube, which allows over a billion people to discover, watch and share originally-created videos. The big difference between the two is YouTube focus on helping people discover videos – and YouTube’s Content ID program, which ensures that what gets discovered are “originally-created videos.” Facebook is just focused on watching and sharing videos.
Zuckerberg also confirmed that Instagram had reached a new milestone of 400 million monthly active users, and that more than 80 million photos are now shared on Instagram every day. That a big number. But, does this mean Instagram is a photo-sharing site? He let us know how many photos are shared a day, but there was no mention of how many videos are being shared. Why the omission?
Mobile Ad Revenue Up on Facebook
Sheryl Sandberg, Facebook’s COO, shared a couple of more nuggets of news. She stated that revenue from mobile ads was up 73% year on year to $3.4 billion and grew 73% year-over-year. That means that mobile accounts for around 78% of Facebook's total revenue from advertising. So, Facebook is focused on mobile. Tell me more. Sandberg continued by stating that
"The average American adult spends 25% of their media time on mobile, and Facebook and Instagram together continue to account for over 1 in 5 minutes on mobile in the US”.
Mobile, mobile, and mobile. Get it? Got it? Good. Sandberg stated that Facebook was a good fit for marketers as it has "the best performing mobile ad products, and video is making them even better". She believes that Facebook video gives the marketer a chance to reach a mass audience, with great cross device targeting and measurement". Gosh, she just kicked sand in YouTube’s face. But, we’ll examine Facebook’s “belief” that it offers better measurement later in this column.
Facebook: Video Advertising is Working for Retailers
Sandberg added, “Video ads complement TV ads. According to a recent study with Nielsen Research, marketers using Facebook ads with TV ads saw higher reach, ad recall, brand linkage and likability. To share one example, GMC used video and other ads on Facebook to extend the reach of their TV brand campaign highlighting their premium trucks and SUVs. The Facebook campaign drove a 13 point lift in ad recall and a 6 point lift in brand favorability.” Interesting. I love examples. But I’d also love to know how many visits to dealer showrooms, test drives, and sales of premium trucks and SUVs this Facebook campaign generated.
Sandberg continued, “We recently introduced Target Rating Point, TRP buying, so that marketers can plan, buy and measure video ads on Facebook the same way they do on TV. We're pleased with the feedback we're receiving on this from marketers and agencies.”
Now, don’t get me started! Regular readers of ReelSEO have already heard the story of my father’s classic TV ad campaign, which proclaimed, “This is not your father’s Oldsmobile.” His agency used GRPs to measure success, but their ad campaign un-sold 62.5% of his target audience in less than five years. So, you won’t be shocked, shocked to find out that I think Target Rating Points are almost as bogus a metric today as Gross Rating Points were back when my father was the director of marketing at Oldsmobile. TRPs, like GRPs, measure the delivery of impressions, not the impact of ads.
Nevertheless, Sandberg said, “Our third priority is making our ads more relevant and effective. Carousel ads show multiple images, and now videos, and drive 30% to 50% lower cost per conversion than single-image link ads”.
Okay, cost-per-conversion is a significantly better metric to use than TRPs. And so is ROI, although video marketers should actually be using return on marketing investment (ROMI). And if Facebook ads can generate results that are comparable to search, then they would be a nice complement to a Google AdWords for video campaign.
Sandberg concluded with a couple of quick case studies. The first was from Marriott, which used dynamic product ads to retarget travelers based on their travel search habits. Marriott is seeing a “high ROI,” although the specific number was not disclosed, and it is rolling out this new way to deliver targeted impressions across their portfolio of global brands. The second case study was from Boost Mobile, a Sprint brand, which showed ads to people eligible for device upgrades. Using Conversion Lifts, they were able to attribute a 4% lift in in-store sales to their Facebook campaign. Now, that's cool. Which brings us to the topics that I said I’d talk about “later in this column.”
Video Marketers Face a Two Party System
Video marketers are indeed faced with a two-party system. According to eMarketer, global mobile ad spending is expected to be $72.1 billion this year, and Google’s share of this market is projected to be 33.7%, while Facebook’s share is forecast to be 17.4%. And, according to comScore, the Top 6 – and 8 of the Top 9 – apps in the U.S. are owned by Facebook or Google.
Today, some casual observers may mistakenly believe that it doesn’t matter whether you choose YouTube or Facebook video. They naively think that the newer video platform is better because “we must move forward, not backward; upward, not forward; and always twirling, twirling, twirling towards freedom!” But, there’s a big difference between YouTube’s and Facebook’s world view of video marketing and video advertising.
Facebook is primarily focused on advertisers. Facebook is narrowly focused on views – and says a “view” is reached at the three-second mark whether or not the viewer has even turned on the sound. Facebook has just begun to help copyright owners deal with aggregators. And Facebook actually wants us to return to the TV era when GRPs, which have now transmogrified into TRPs, could be used as meaningful metrics for planning, buying, and measuring video ads. That's a load of bunk.
In contrast, YouTube has a more balanced concern for partners as well as advertisers. And partner revenue is up 50% year over year -- and we've seen this level of partner revenue growth for three straight years. And the number of channels earning six figures per year on YouTube is also up 50% year over year. YouTube also has a more balanced concern for giving viewers choice over which ads they watch and connecting brands with a more engaged audience. In fact, with TrueView ads, you don’t pay for random impressions or maybe-they-saw-its. The viewer has to choose to watch your video or there’s no charge. YouTube began trials of its Content ID system way back in June 2007 to help copyright owners to easily identify and manage their content on YouTube. And YouTube not only urges advertisers to go beyond impressions and clicks, it also offers Google’s Brand Lift solution to help them measure brand awareness, ad recall, and brand interest.
Finally, if you’re looking for a recent example of the impact of video ads, check out this one: P&G’s Gillette generated buzz for its latest razor, Gillette BODY, by targeting a rapidly expanding audience of body-grooming men. With a digital-first strategy anchored by YouTube TrueView ads, Gillette reached millennial males with their “100 Years of Hair” video ad.
The results: over 84% of the 13.5 million total viewers finished most of the video, there was a 211% lift in searches for the Gillette brand, and the video ad generated over 500,000 clicks to buy.
Any questions? If not, then vote early -- and often -- for YouTube. If Facebook cleans up its act, then you can split your ticket in future elections. Or, go ahead, throw your vote away by voting for a third-party candidate. Come on, unlike Canada or the U.K., this is a two-party system.