The media industry’s love-hate relationship with Facebook continues, with Instant Articles and native video enticing media to publish more of their content directly to the platform on the one hand, while presenting unclear monetisation opportunities on the other.
At the Digital Media Strategies conference hosted in London earlier this month, an informal round table chat took place where an international group of digital media leaders discussed this current challenge.
There emerged three distinct ways to look at generating revenue from Facebook. As my work at Wochit means most of my conversations with media revolve around video in particular, I have added in supporting anecdotes where appropriate.
Strategy 1: Drive Traffic Back
The classic strategy for Facebook monetisation has always been to use activity on the platform to entice readers back to owned and operated properties where they could be advertised to, and sold subscriptions and services.
The Pros: Media companies maintain complete control over the monetisation model and user experience (which isn’t always a good thing for the user, hence, ad blocking). Julie Harris, Group Managing Director at Immediate Media shared how they capitalise on this strategy by attracting couples to their wedding planning services through the Facebook pages of Hitched.co.uk and Perfect Wedding Magazine.
The Cons: Facebook clearly has an interest in keeping users within its own universe, so the organic reach of posts, and the ability to drive traffic off the network from that reach, are both very difficult to rely on.
Something to consider: It has been showed that natively uploaded video is shared 4x more than external links, so some publishers are scaling up their social video operations in order to reach larger audiences on Facebook in the short to medium term. The thinking, as explained to me by Gianluca Verano, the marketing manager at Gazzetta.it* (Italy’s largest sports newspaper), is that using video to increase reach and collect more likes for the page leads to better exposure when they do post external links to their articles, and thus drives more traffic back to the site.
Strategy 2: Branded Content
Charging money to craft and spread sponsored content across social networks is a core business model for many media companies today, perhaps best exemplified by BuzzFeed. Thanks to recently relaxed rules by Facebook, the route of sponsorship is also now open on what is undoubtedly the most powerful content format on the social network: native video.
The Pros: A recent interview in The Guardian revealed that the UK-based Unilad charges a respectable £12 cpm for a display ad, but can fetch upwards of 20,000 GBP for a sponsored video that goes on its social channels. And this is not a fluke, in speaking with another digital-first outfit about that figure, they mentioned £35,000 for a brand sponsorship of one of their socially distributed videos. If done right, sponsored content should be genuinely interesting to a media outlet’s audience, providing uplift to both the sponsor and the publisher, as well as representing significant revenue opportunities for the publisher.
The Cons: Paul Lomax, CTO of Dennis Publishing* noted that building an agency inside a media company is not necessarily a natural fit. While a publisher’s existing editorial resources may be their competitive advantage over traditional agencies when winning business from a brand, asking journalists and editors to make time for commercial work can be controversial and complicated. “Some have built whole teams, agencies within the business. We wanted to make sure brands get the A team – our real editorial teams – so we’ve put a lot of effort into process and collaboration”, explained Lomax.
Strategy 3: Native Monetisation
There are two primary ways for media to generate advertising revenue directly from within Facebook, and both of these are currently only open to a select group: Instant Articles and native video.
Let’s start with Instant Articles, the mobile-optimised way for media to publish entire articles directly on Facebook and serve advertising using the Facebook Audience Network or a publisher’s own inventory (as long as it is compliant).
The Pros: Monetisation levels for Instant Articles have been “competitive” according to France’s Libération newspaper. The eCPM they are seeing is about 1.80 USD, and Facebook inserts an ad unit every 350 words in articles. Being present on Instant Articles also seems to attract a larger overall audience, Gawker reported an increase from 4M monthly uniques to 4.7M after putting all their content on Instant Articles.
Stats… After Gawker properties live on Facebook Instant Articles, US UVs up to 4.7m, from earlier norm of 4m. pic.twitter.com/TB1GTGt9ss
— Nick Denton (@nicknotned) March 1, 2016
The Cons: Instant Articles will be opened up to all publishers at the upcoming Facebook F8 conference on April 12, but for now the opportunity is invite only. Also, the advertising restrictions that Instant Articles launched with were met with quite a lot of pushback from publishers. The situation seems to have improved, but the fact remains that Facebook completely controls this user experience and will impose the standards it sees as necessary to keep articles loading lightning fast. Another issue is tracking: the likes of comScore and Nielsen can’t see the engagement happening within Instant Articles and this can pose a slew of problems for media companies and their advertisers.
The other opportunity is native video monetisation, where publishers upload their video directly to Facebook and the network pulls viewers into a stream of suggested videos with interstitial ads between every few videos, sharing the revenue back with the content producers.
The Pros: Facebook videos are obtaining unprecedented reach for media brands, with AJ+ getting 2.2 Billion video views last year on Facebook alone. Turning on plug-and-play monetisation here could represent an enormous new revenue opportunity for those publishers that are creating the kinds of video Facebook users like. Gabriela Bolognese at El Mundo* told me that they are one of the early beta partners for Facebook video monetisation, and while it is still an exploring phase, El Mundo video views are up and it is earning revenue according to view time in minutes. She noted that it’s impossible to compare with a standard CPM rate due to the different metric of time spent, but onsite monetisation is still much better right now.
Que el Día de la Mujer se celebre un 8 de marzo tiene su porqué…
Posted by El Mundo on Tuesday, March 8, 2016
The Cons: We also don’t know when Facebook will open up video monetisation to all, for now it is being tested with a handful of important global media groups like El Mundo, Huffington Post, and Business Insider. There is also the question of control: publishers relinquish their ability to curate an experience when they publish video straight to Facebook. It’s not hard to imagine a publisher feeling uneasy about the idea of Facebook lining up videos from various sources and serving ads between them at its own discretion.
Why not all three?
Simply put, the traditional business model of mass media consists of two components: first, create content to attract an audience, then second, deliver advertisers’ messages to that audience. Media companies are now capable of reaching larger audiences than ever before thanks to Facebook. And much has been done on the editorial side to work on that first component of broadening reach, with audience development and audience engagement teams popping up at many major media outlets. For the second and more commercial component of the equation, we have here three concrete paths for monetising Facebook reach. Clearly each of the above three strategies comes with its own sets of challenges, but these are not mutually exclusive options. In fact, what’s to stop you from trying all three?
* Full disclosure — I work with Gazzetta dello Sport, Dennis Publishing, and El Mundo as Wochit partners.
Garrett Goodman is European Director of Business Development for Wochit, an award-winning video creation platform for media.
[Photo credit: Got Credit]