Oh, No! Auto-Playing Video Ads Are Coming to Facebook

By Leo Mirani
Zuck knows your needs—if you're a marketer. (AP/Craig Ruttle)

Nobody likes auto-playing videos, most of which tend to be ads in one of the dozen or so tabs you have open. Such a scourge are they that Google is testing a version of its Chrome browser that helps users find where the sound and video is coming from—presumably so users can immediately close the offending tab. That has not discouraged Facebook, however. If the Wall Street Journal is to believed, Facebookwill announce today (paywall) that it is to start rolling out auto-playing video ads in newsfeeds—and fullscreen on your mobile phone—starting Thursday.

So why would Facebook venture where few others have dared? There are three main reasons. The first is that video ads are simply much more remunerative. This chart from a report (pdf) from Turn, a digital advertising company, shows just how much more remunerative.

The “estimated cost per 1,000 views” paid by advertisers for video far outpaces that for other forms of online advertising.Turn

Second, spending on online video ads growing rapidly, from under $3 billion in the US alone last year, to over $4 billion this year. It is projected to double to $8 billion by 2016, according to a report form eMarketer. Facebook would be foolish to not at least try to grab a piece of the action.

Finally, video ads tend to be more effective. Two researchers from Akamai, an internet infrastructure company that helps serve up to 20% of the web’s content,found that (pdf) internet users tend to view videos ads all the way or nearly all the way to the end. A 15-second ad, then, provides much better value for advertisers than an easily ignored banner ad or text ad. The researchers looked at ads that were part of other, longer videos that people had set out to watch, something that will not be the case on Facebook.

But what is pertinent to the social network is that 15-second ads—the length Facebook is planning—were among the most likely to be watched through to the end. Equally important, repeat visitors to a video-providers complete ads more often than a one-time visitor. Admittedly Facebook is not a “video-provider,” but if there is one thing it can legitimately claim, it is that its users are indeed repeat visitors.

Now for the bad news

There are some caveats. Most studies of online video ads have concentrated on ads that come before, during or after a longer video that users have chosen to watch. These users are already set to watch video. This will not be the case with Facebook, which will drop the ads on what is a text-and-image based newsfeed. Moreover, while spending on videos ads is increasing, growth is slowing and rates are declining (paywall).

Still, Facebook figures it has a captive audience, for which it will charge advertisers $2 million a day. According to a Facebook slide deck obtained by TechCrunch, people check their phones about 100 times a day and Facebook 10-15 times a day. If users have no choice but to sit through an ad before getting to the good stuff, they will do one of two things: 1) watch the ad, or 2) leave the social network. Facebook is betting that with its short 15-second ads users will stick around.

This article available online at:

http://www.theatlantic.com/technology/archive/2013/12/oh-no-auto-playing-video-ads-are-coming-to-facebook/282435/