How Important Are Facebook’s Premium Video Ads for Digital Marketers?

Prasant Naidu
Prasant Naidu Founder, Lighthouse Insights

Posted on March 21st 2014

How Important Are Facebook’s Premium Video Ads for Digital Marketers?

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Facebook Founder Mark Zuckerberg has the toughest job in this world. He has to make sure that the 1.23 billion users on the network log in every single day and spend more time on the platform, while at the same time he has to keep his investors happy by taking marketers into confidence.

It took almost six years for Facebook to get serious about displaying ads in the News Feed. At a time when marketers wanted flashy ads, control on the pages, home page takeover, basically the ways they have been spamming the web traditionally, Mark was concentrating on growing the platform’s reach. One of the primary reasons why GM pulled out its ads from Facebook in 2012.

Facebook’s last quarter financial performance revealed that it earned a revenue of $2.59 billion and earnings per share of $0.31. The social network which now calls itself a mobile first company, also highlighted that it now earns 53% of ad revenue from mobile, that is $1.37 billion of its $2.59 billion revenue.

But all is not sailing smooth for Facebook that has more than 757 million total daily users. The network has been facing the heat from the next generation of mobile networks. With teens still spending more time on Snapchat and other platforms, Facebook has received flak on the way ads are being displayed by compromising user experience.

Since last year Facebook has been working on simplifying the way advertisement works on the network. With Sponsored Stories blending well with the news feed both on web and mobile, Facebook started focusing on auto-playing videos late last year.

After witnessing an increase of 10% engagement in terms of views, likes and shares on mobile and desktop versus the non autoplaying kind, Facebook rolled out trials for autoplaying ad videos prior to Christmas.

The trails are over and in the latest announcement Facebook said that it is launching the much anticipated Premium Video Ads with a select group of advertisers.

According to Facebook, the 15-second video ad will start playing without sound as it appears on-screen and stop if people scroll past. If people tap the video, it will expand into a full-screen view and play sound.

Preetham Venkky, Business Head – KRDS Asia is very excited by the introduction of the non-intrusive and muted videos. “One sided way of content creation is gone,” adds Preetham, while sharing his views over a call.

According to Preetham, marketers cannot have one perfect commercial and with this new feature brands are getting an opportunity to create a series of content based on demographics, test and select the one that gets more engagement and then make the perfect TVC to suit the audience.

While it is too early to comment on the success of the feature states Sridhar Rajaram, Group Manager Marketing at Louis Philippe but he is quick to add that, “Facebook Premium Video Ads might just fuel more creativity amongst marketers and really push them to create more interesting 15 second content, something that is not easy to do at all.”

Facebook is forcing marketers to think even more for creating exclusive video content for Facebook. “Challenge is the content that brand managers will now have to create. Video advertising is already a fast growing segment due to YouTube and hence there won’t be any problem for marketers to lap this up,” informs Rajiv Dingra, Founder and CEO at WAT Consult.

Believing that brands won’t be pumping their existing TVC’s like they have been doing on YouTube, Sridhar thinks that the biggest question is how will videos auto-play on mobiles which is where the largest set of FB users are moving towards.

“With the kind of connectivity issues we are seeing in our country, it will be a major challenge for videos to start auto-playing for mobile users. Crossing that hurdle is going to be key to the success of this format in our environment,” adds Sridhar.

Internet, which remains a challenge in emerging countries, might be a road block for Facebook Premium Ads. But Facebook says that it caches while you’re connected to Wifi even if they’ll be shown later to prevent ads from burning up your data plan.

Keeping the user experience non-intrusive, Facebook has also made an attempt to connect with those digital managers who still measure digital with traditional targeted Gross Rating Points. According to the Facebook, Premium Video Ads will be measured the same way how advertisers already buy and measure ads on TV.

The ads would be bought based on Targeted Gross Rating Points to reach a specific audience and delivery would be measured by Nielsen Online Campaign Ratings (OCR), and advertiser only pay based on what Nielsen OCR measures.

Preetham shares that there are marketers who still love GRPs and by bringing the old measurement ways, Facebook is bridging the gap between the existing and the future. In consensus, Rajiv adds, “With GRPs Facebook tries to give a TV correlation to marketers and that’s great when you look at the senior marketers who are still not conversant with digital metrics or don’t believe in them.”

However, Sridhar considers the integration of GRPs as a very simplistic measure for a medium that can provide so much more in terms of reference data for decision making.

“Unless FB has plans of integrating this with other metrics that are inherent to this medium like engagement and impressions, this will remain a standalone tool that does very little value addition to campaign planning,” adds Sridhar, considering that marketers who understand the power of social as a medium will understand that digital GRPs is just a small reference point when planning their campaign.

With the introduction of traditional metrics of measurement, Facebook is inviting marketers to measure the performance of the ads on the same benchmark as they have done for TV. One may consider that Facebook might be locking horns with TV but Preetham firmly states that, “TV is surely getting replaced by digital but not with Facebook.”

The fate of Facebook Premium Ads will possibly be revealed in the next earnings call. While the new one-column News Feed design will help these ads catch more eyeballs, exclusive content and video thumbnails specially will also define the success of such ads.

Facebook states that it will be very careful in tying up with advertisers and has a broad mechanism behind the selection of video ads, but will that promise hold true when the platform opens up for all?

Prasant Naidu

Prasant Naidu

Founder, Lighthouse Insights

Founder and Blogger at http://lighthouseinsights.in, Indian social and digital media news.

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