WHITE PAPER NOVEMBER 2014 FACEBOOK VS YOUTUBE WHO WILL BE THE KING ...

2 CONTENTS 2. Introduction 3-7. Does Facebook have what it takes? 8-10. Ice Bucket Challenge 11. Facebook and Auto Play 12-13. The Future of Facebook 14. About BlueDoor Inc., Sources 1

3 INTRODUCTION When it comes to video sharing, YouTube has always been the top player. No other social platform had ever come close in competition and that had remained the case until recently. Facebook has just announced its intention to increase its presence as a video sharing site, adding enhancements and certain features to its own platform to compete more effectively with YouTube. Since the beginning of September 2014, Facebook has begun to mirror YouTube video characteristics by introducing video view counts, as well as recommending relevant content at the end of uploaded clips. By introducing these features, Facebook hopes that brands and marketers will be more likely to post videos to the site, because they will now be able to track and measure the results of their marketing campaigns. They will be able to establish how well audiences are responding to their videos and content. These YouTube-like features can also benefit the average user by assisting in locating popular and trending video clips. Facebook also plans at some point to allow videos uploaded on the site to be more easily embeddable on third-party sites. Here we will evaluate the ongoing battle between Facebook and YouTube and will determine whether Facebook can indeed overtake the site that still dominates the video sharing world. 2

4 DOES FACEBOOK HAVE WHAT IT TAKES? As stated previously, Facebook is attempting to mimic several video features that YouTube currently offers. Should YouTube be worried? According to Facebook, the site is pulling in average figures of more than 1 billion video views per day. These views have increased 50% from May to July in 2014. More than 65% of video views are on mobile devices. (Source: pcpro.co.uk) In September 2014, Facebook announced that there will be a call to action tool available to publishers. This tool will direct audiences to specific websites of further related content. Publishers will also have access to a better analytical system that will help them better measure viewing figures, and to connect with target users. YouTube is still the dominating force in video sharing especially due to the fact that publishers can earn money from ads showcased around their videos. But Facebook has an edge. The social factor of Facebook means that videos are shared quickly; therefore gaining popularity at a much faster rate. The New York Times has reported that the management company of global superstar Beyoncé, communicates with fans mainly through Facebook. They do this by uploading videos of behind-the-scenes footage of her musical performances. Her VMA performance, which was uploaded towards the end of August, accumulated 2.4 million views in the first few hours of being posted. The same video was also posted on YouTube, but received only a few thousand hits in comparison. (Source: newyorktimes.com) 3

5 DOES FACEBOOK HAVE WHAT IT TAKES? It seems that the reason for the video s popularity on Facebook was that the 64 million (Facebook) fans of Beyoncé were able to view and share the clip on their newsfeeds. The fans that were viewing the same clip on YouTube could not share it so easily. ''For us, Facebook has become the primary platform that we use to communicate content to fans,'' said Lauren Wirtzer Seawood, head of digital at Parkwood Entertainment, Beyoncé's management company. Screen grab from the behind the-scene footage that was posted on the Facebook page. 4

6 DOES FACEBOOK HAVE WHAT IT TAKES? Facebook continues to have an advantage over YouTube in so far as the sharing option is built into the site clicking like or share makes a video instantly visible on people s newsfeeds. While sharing is possible on YouTube, it isn t quite as easy as the one click option offered by Facebook. Since June 2014, Facebook has seen on average a billion video views a day, with about 100 million new videos being uploaded every month. While these figures don t quite match up to the traffic of YouTube, it is still a sharp increase in only a matter of months. (Source: cnbc.com) The popular website BuzzFeed places its content on many sites, but Facebook is among the fastest growing. Mr. Frank said the number of times BuzzFeed videos were shared on Facebook grew 160 percent from June to July, and 200 per cent from July to August. (Source: cnbc.com) A blogger posting on entrepreneur.com conducted an experiment with the two video sharing sites, by posting the same video on both platforms. The blogger noted that the reach and engagement figures were much higher on Facebook. (Source: entrepreneur.com) 5

7 DOES FACEBOOK HAVE WHAT IT TAKES? A larger (but significantly older study) was conducted by social bakers in 2013. The study compared the engagement rates between videos uploaded directly onto Facebook, and also shared on the site via YouTube links. The study noted that Facebook page administrators preferred to upload videos via YouTube links, rather than posting videos natively. According the study, page admins posted 3,684 YouTube links compared to 458 Facebook videos towards the end of January (from January 22nd to January 27th 2013). It was revealed that even though YouTube links were posted 8 times more than Facebook videos, both platforms received similar levels of interaction and similar numbers of likes, shares and comments. This can be seen in the graph below. Likes were the most popular form of interaction and the Facebook videos generated double the amounts of comments that YouTube links did. 6

8 DOES FACEBOOK HAVE WHAT IT TAKES? Native Facebook videos achieved a 40% higher engagement rate than YouTube links. The reason for this may be because the videos are more easily viewed on mobile devices as they play directly from Facebook newsfeeds. Viewing YouTube links means having to be redirected to the YouTube site which means more data consumption. As stated earlier this study was conducted more than a year ago and posting videos directly to Facebook as opposed to posting links from YouTube has become much more popular. The social media phenomenon which highlighted this switch was perhaps the ALS Ice bucket challenge. 7

9 ICE BUCKET CHALLENGE THE TURNING POINT? It can be argued that the ice bucket challenge has best demonstrated Facebook s growing popularity in video-sharing. The global craze took place over the summer of 2014. It involved millions of people from celebrities to average Joes pouring buckets of ice water over their heads to raise money for research into amyotrophic lateral sclerosis. Between June 1 and Sept 1, Facebook said that millions of videos related to the challenge were shared on its service. These videos were viewed more than 10 billion times by more than 440 million people. (Source: facebook.com) The views on these videos were so high because they could be automatically seen on auto-play, and Facebook's tagging feature allowed people to challenge specific friends to take the challenge. ''The coolest thing is, it taught people how to post a video,'' said Mr. Cox of Facebook. In comparison YouTube received 1 billion views of ice bucket challenge videos and 2.3 million uploads. (Source: fool.com) 8

10 ICE BUCKET CHALLENGE THE TURNING POINT? 2,420,000 2,400,000 2,380,000 2,360,000 2,340,000 2,320,000 2,300,000 2,280,000 2,260,000 Ice Bucket Challenge Uploads 2,240,000 Facebook YouTube 12,000,000,000 Ice Bucket Challenge Views 10,000,000,000 8,000,000,000 6,000,000,000 4,000,000,000 2,000,000,000 0 Facebook YouTube 9

11 ICE BUCKET CHALLENGE THE TURNING POINT? Facebook found that more than 28 million people have discussed the Ice Bucket Challenge on the site ranging from posting videos to liking related statuses, between June 1 and August 18. (Source: time.com) In one month, the Ice Bucket Challenge has shown that Facebook is capable of taking on YouTube as a platform for user-generated video. 10

12 FACEBOOK AND AUTO PLAY The large number of Ice Challenge views on Facebook can be attributed to the auto play feature that Facebook introduced in 2013. Auto play means that by default, videos automatically start playing on the website or the company's mobile apps without having to be clicked on, as the user looks down their newsfeed. While the feature has been more than beneficial for Facebook since its introduction, it has not come without its problems. Facebook users have complained that even though the sound is automatically switched off, they are seeing their data usage sky rocket. Facebook have tried to remedy this problem by allowing users to switch of the feature. The site has also minimized data consumption and added an option whereby the videos only play in Wi- Fi connected areas. The Discovery Channel has been using the auto-play feature of Facebook for a few months, and has found that hands down, almost in every instance the video posts outperform any other content types in terms of overall reach and engagement, according to Derek Dodge, director of digital programming for the cable network. It was especially beneficial for the #snuffylives campaign during Shark Week in August 2014. (The #snuffylives campaign involved bringing back the seal that was swallowed by a shark in a promo in 2013). The campaign video was posted on the Discovery Channel s Facebook page, and was viewed by 15 million people organically over the course of the week. It changed the way we think about using Facebook, Dodge said. In the past we saw it as a marketing platform now it s more of a pure media platform. This is helping us extend our video strategy into social media. (Source: variety.com) Showtime Networks is also seeing higher engagement levels for videos posted directly on Facebook. According to Brian Swarth, VP and group director digital services at the premium cabler, When using Facebook s video player, user engagement on the social service is two to three times higher than non-native video players (such as YouTube), he said. Facebook continues to be interesting for us across digital marketing in general, and we ve specifically seen a massive increase in engagement with our sports content on Facebook, Swarth said. (Source: variety.com) 11

13 THE FUTURE OF FACEBOOK AND VIDEO-SHARING According to Facebook's Chief Product Officer, Chris Cox, the site needs to do a better job of informing average users how to shoot great video with their smartphones, and showing professional creators how to use the social network to amplify their audience (source: fool.com). In response to this, Facebook have released a new app called Hyperlapse. The app helps to simplify video content creation for experienced and inexperienced videographers. It uses gyroscope from mobile devices to stabilize the shooting and allows users to speed up the playback time. The videos can then be shared directly to Facebook pages. Facebook needs to capitalise on the success achieved by Beyoncé s behind-the-scene footage by reaching out to well-known content creators in order to encourage them to upload more native Facebook videos. The site is also working towards hosting more videos on the site and in a timelier manner. We don't support embedding right now. We should,'' Mr. Cox said in an interview, referring to the ability to incorporate a Facebook video into other sites. ''We need to make sure people have good controls over how and what videos they are seeing.'' (Source: cnbc.com) If Facebook manages to incorporate this feature it will attract more direct uploads from publishers. 12

14 THE FUTURE OF FACEBOOK AND VIDEO-SHARING Perhaps the key thing Facebook needs to concentrate on is working towards attracting professional content creators by offering a share in revenue. YouTube's Partner Program has over 1 million creators; earning substantial money from their uploads. Facebook does not currently have anything like that in place. (Source: fool.com) Facebook has been showing strong growth in relation to video sharing over the last 2 years but it still has a lot of catching up to do. Facebook currently averages 1 billion views per day whereas YouTube averages more than 4 billion. (Source: entrepreneur.com) Over all, Facebook s goal with video is to build a compelling offering around our partners content, said Justin Osofsky, VP of media partnerships. Things that drive engagement on Facebook are a win. Things that drive distribution to our partners sites are a win. (Source: variety.com) Will Facebook accumulate enough growth to entice users and advertisers away from the safety net of YouTube? Only time will tell. 13

15 ABOUT BLUEDOOR INC. BlueDoor Inc. is a social media company based out of Toronto, Canada, specializing in social media strategy development and execution for mid-size and large organizations. Since being established in 2011, BlueDoor has served a variety of sectors, including retail, e-commerce, financial, real estate, marketing, medical, food & hospitality, travel and more. BlueDoor s primary product and service offering consists of an in-depth industry analysis, specific strategies and tactics to achieve business objectives and detailed execution plan to turn ideas into measurable results. This premium product is one of its kind in the marketplace today, and is the primary reason for the company s growth over the last few years. To learn more about our company, products and services, please visit us at www.bluedoorinc.com. Join our LinkedIn group called Social Media Done Right and don t forget to connect with us on the other networks! References http://youtube-trends.blogspot.ca/2013/02/the-harlem-shake-has-expl... http://www.fool.com/investing/general/2014/09/13/how-the-ice-bucket... http://time.com/3117501/als-ice-bucket-challenge-videos-on-facebook/ http://www.pcpro.co.uk/news/390679/facebook-gunning-for-youtube-wit... http://www.entrepreneur.com/article/237197 http://www.cnbc.com/id/101978954 http://www.entrepreneurdelights.com/facebook-vs-youtube-the-battle-... http://www.socialbakers.com/blog/1417-facebook-videos-vs-youtube-li... http://www.nytimes.com/2014/09/08/technology/facebooks-feeds-give-v... 14