Facebook launches moments at top of News Feed (FB)
BI Intelligence
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Facebook is slowly launching a new feature where users can share messages at the top of News Feed about a specific event or moment, according to TechCrunch. The new feature was announced on December 20, and Facebook is starting with Holiday Cards that users are prompted to customize and share with friends via their News Feed.
The feature is similar to Google Doodles — the customized changes to Google’s logo on the search home page to reflect holidays, anniversaries and the lives of famous artists, pioneers and scientists.
Here are a few implications of the launch:
Facebook wants users to get more interactive. The new feature has the potential to increase user engagement on the platform by making it easier to share notable moments with friends. While most interactions in the Facebook app happen in the News Feed, it is mostly a location for browsing friend’s posts and consuming content. Prompting users to create more immersive content, beyond status updates, in the main section of the app, could keep users further engaged with ads in the News Feed. Keeping users highly engaged is becoming a high priority as Facebook is approaching maximum ad load, and could see decelerating ad revenue growth in mid-2017.
More ad space? No, Facebook says it’s a new “marketing program.” The launch was announced via a blog post the company’s Chief Marketing Officer, Gary Briggs, which brings to mind potential sponsorship opportunities for brands. However, Facebook told TechCrunch that this is not the case, and that the feature is a “brand and marketing initiative.” This is consistent with Facebook’s historical strategy: build engagement before monetizing.
It makes sense for the company to eventually monetize the new feature as a premium ad unit, as it requires user engagement, and is delivered in a heavily-trafficked section of the app. If Facebook does decide to monetize, the roll-out will be very gradual, to a select set of users and advertisers. After all, Facebook acquired Instagram in 2012, and didn’t roll out global ad units on the photo app until 2015.
Consumers continue to increase their time spent consuming digital media, while advertisers continue to increase their ad budgets into digital channels.
The influx is not expected to let up in the near future. The US digital advertising industry will continue to experience remarkable growth through 2021 to reach nearly $100 billion in annual revenue, driven primarily by the sustained migration of ad dollars from traditional TV to digital video and the continued increase of social spending.
Overall, the strong growth of the US digital ad market can largely be attributed to increased time spent by consumers on digital media and brands' increased comfort with allocating budgets to digital formats, particularly on digital video. In a recent 2016 survey of almost 400 US ad agencies and marketers, the IAB found that two-thirds of respondents plan on increasing spending on digital video in the next year.
Moreover, mobile will become the top destination for digital ad spending as advertisers continue to attempt to resolve the disconnect between the rapid growth in time spent on phones and tablets and the relatively small share of ad budgets that are allocated to such platforms — known as the mobile opportunity gap. In fact, mobile is set to eclipse desktop ad spend by 2018.
Dylan Mortensen, senior research analyst for BI Intelligence, Business Insider's premium research service, has compiled a detailed report on U.S. digital media ad revenue that forecasts revenue trends over the next five years and outlines the key growth drivers for overall digital ad revenue in the U.S.
Here are some key points from the report:
- US digital ad revenue is expected to reach nearly $100 billion by 2021, according to BI Intelligence estimates. This represents compound annual growth of 8% from the $68.9 billion expected in 2016.
- Mobile is positioned to become the top destination for digital ad spending as advertisers continue to attempt to close the "mobile opportunity gap."
- Digital video advertising will grow faster than any other segment over the next five years, as consumers shift time spent online to phones and tablets. Revenue in this category is forecast to rise from $8.5 billion in 2016 to $23 billion in 2021.
- Social advertising in all formats is gaining traction and will be among the key drivers of digital ad growth in the next five years. Social ad revenue is poised to climb to $30.8 billion by 2021, up from $15.5 billion this year.
- Artificial intelligence, augmented and virtual reality, and sponsored content will help propel further digital ad growth in the next decade.
In full, the report:
- Forecasts US digital ad revenue through 2021.
- Highlights the rising popularity of digital media with consumers and brands.
- Explores why digital video advertising growth will exceed all other formats over the next five years.
- Outlines emerging technologies that will help propel ad growth in the next decade.
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