Facebook is taking another page from traditional TV networks by limiting the supply of its new video advertising opportunities, in hopes of grabbing high premiums for cost-per-thousand (CPM) viewers.
If that’s worked for TV, why not for social media?
Facebook is also setting up a favorable “reach” equation -- a typical TV selling point. This comes from looking at those younger-skewing viewers who seem to be doing other things while watching TV -- like being on Facebook.
Facebook says TV networks only reach 55-61% of 18-24 year olds during primetime, but Facebook reaches 70%. Facebook also says that marketers can reach the majority of its users within one to three days.
Three days? Hmmm... Does that sound familiar to what traditional TV promises -- average commercial ratings plus three days of time shifting (C3)?
Maybe that -- and more. Both YouTube and now Facebook are taking dead aim at TV advertisers, appealing to what they understand most: not just commercial scarcity and grabbing hard-to-get viewers, but adopting CPM models and price premiums.
Advertisers this year will have spent about $66 billion on TV versus around $4 billion for digital video, with YouTube commanding the biggest share of that at around 20%.
Facebook’s plan could be good for the present -- and theoretically the future.
Rope marketers in with data and price points they are familiar with and then lay on all the extras -- deeper engagement, more compelling content than traditional TV for those young viewers, and more accuracy in determining exactly who those viewers are.
Downside? TV marketers still need measurement that’s easily digestible and comparable. That picture still isn’t clear.