On the heels of the NewFronts and moving towards the upfronts, Facebook has a sweet endorsement as it looks to grab some of the lucre in the $70 billion TV marketplace. The maker of a famed European chocolate spread says Facebook advertising generated a higher ROI than TV spots in a late-2011 campaign.
(Quick aside: why has the media taken to capitalizing the “N” in “NewFront,” while sticking with the lower case “u” for upfront? NewFront organizers have to be thrilled they’ve established a proper noun.)
Even though it has a video ad offering, Facebook wasn’t officially involved with the NewFronts (newfronts?). The presentations were by a handful of entities, where online video is their primary business. Facebook did have a prominent role, however, in an Ad Age digital conference that took place in the days before the NewFront showcases.
Nonetheless, its aim is the same as Hulu’s and AOL’s. The TV market may be cooling just a few degrees, but there is plenty of money to go after.
Facebook advertising is receiving increased scrutiny as the company looks to show investors it has enormous growth potential as it readies for an IPO. A Financial Times report Monday cited a study showing the costs per click have risen significantly over the past year with its “premium” ads, which include the sponsored story concepts Facebook is pushing.
The FT report also cited other data showing less impressive pricing performances. Nonetheless, Nutella chocolate spread may provide some grist for PowerPoint presentations Facebook offers investors in its pre-IPO dance.
In December, Nutella ran a multi-platform campaign that included Facebook and TV executions in Germany. Nutella used various Facebook opportunities. It’s not clear how many, if any, attempts were made to use what Facebook views as the future: ads that include an endorsement from friends.
The campaign looked to persuade people to “like” or become a friend with a Nutella Germany page and use an “Advent Calendar” app involving a German Christmas tradition, according to ClickZ. A research firm found the executions reached 30% of the online traffic in the country.
Nutella attributed 15% of sales generated from the campaign to Facebook. TV may have accounted for more revenue, but Nutella told ClickZ its analysis showed the Facebook ROI was the sweetest.
If one NewFront aim is to encourage marketers to consider online video as an option on par with TV, one analyst suggested Facebook should no longer be viewed as an experimental opportunity.
“If you are only dabbling, it’s going to be too difficult to understand the impact of your Facebook advertising,” Kevin Lee a Didit executive told ClickZ, where he is columnist.
Facebook’s effectiveness is set to continue as the subject of loads of media research. It behooves advertisers when Nutella-type results spread. Perhaps, that could give them more leverage in negotiations with networks and other media.
Then again, as far as TV is concerned, “perhaps” is the operative word.
The Internet hasn’t proven much of a threat to TV. Now, it's considered a vital partner. In that vein, a representative for Nutella’s parent company said in a statement there was a “positive cross-media effect between TV and Facebook.”
As networks look toward the new fall season, Facebook's impact may be less in ad sales and more in marketing the new shows advertisers buy. Networks – notably Fox with “New Girl” – have taken to releasing pilot episodes online before their premieres. Fox has attributed some of “New Girl’s” success to the tactic.
The Facebook “sponsored stories” – where friends’ endorsements are part of ads in a news feed, rather than in a small box on the right side of a personal page -- are tailor made as a companion to the early-release strategy. If it works right, brands capitalize on recommendations from friends and a newfront in the battle to generate elusive word-of-mouth.
Nutella viewed Facebook as a prominent line item in a campaign media mix. Maybe this becomes the year where Facebook becomes as much a part of pre-season marketing efforts as billboards or stunts such as skywriting in the Hamptons.