The Dodo in the coal mine

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Credit: Tam Nguyen

This is a story of a boy and his dog, inseparable friends, the kind of human-animal bond the internet can't resist, and it will likely be The Dodo's next hit show.

Joanna Zelman, Executive Editor at The Dodo, is reviewing the footage, which she filmed recently on assignment in Indiana for a digital video series called "Kid's Best Friend."

In one scene, Carter (the kid) and Toby (the dog) are drinking out of the same outdoor toy sprinkler. They lean into what looks like a Fisher-Price plastic fountain, both wagging their tongues at droplets of hose water. It's just what The Dodo looks for when it's producing these shows, made for consumption on social media, and it's sure to make the final cut.

"We're looking for those genuine moments," Zelman says. "Let the natural moment play out."

The Dodo is behind some of the most-viewed shows on Watch, Facebook's high-stakes bid to capture video views online. Out of its shows—including "Little But Fierce," "Soulmates," "Comeback Kids," "Odd Couples" and "Pittie Nation" (about pit bulls)—it has five of the 15 most-watched, with each averaging between 15 million and 35 million views an episode, according to CrowdTangle. (CrowdTangle, owned by Facebook, is one of the few analytics partners that reports such stats to the publishers.)

While The Dodo seems to be doing well, it and other publishers—including Insider, USA Today, Tastemade and Bloomberg News—are still knee-deep in an experiment, both from their end and Facebook's, to see if there's money to be made on Watch.

The hub is an unsteady environment for media companies at the mercy of Facebook's ever-shifting ad strategies. It's already altered how the ads are sold and where they run, how it promotes the shows and the way it funds them. Watch's constant evolution, then, means publishers' first prerequisite is adaptability.

"Facebook will always be changing," says Ben Lerer, CEO of Group Nine Media, owner of The Dodo, NowThis, Thrillist and other digital brands. "Part of being a really productive partner with them is understanding that's the case. If you don't have the flexibility built into how you operate, they're a tough partner."

Publishers are also up against a hard reality: Watch, which competes for viewers with YouTube, Netflix, Hulu and Amazon, might not survive in the long run. Facebook plans to invest $1 billion in content this year to secure rights to programming that it hopes will compete. It already has a deal to show weekly games from Major League Baseball, and has acquired shows from sports celebrities like Tom Brady and LaVar Ball. It also recently programmed a news section, where it's paying for series from Fox News, CNN, ABC, NowThis, ATTN: and others.

"It's going to be very costly for Facebook to keep investing in this area," says one digital ad agency executive, who spoke on condition of anonymity. "Everyone is fighting over the same kinds of content creators, and it's going to be difficult to have sustained winners."

Natural selection

For now, says Lerer, "The Dodo is making very real money direct from Facebook." He wouldn't give details about how much revenue Group Nine makes through Facebook videos, and Facebook doesn't disclose ad sales figures. But Watch has started to send more money publishers' way, especially if they are high-volume publishers like The Dodo and can pile up the monthly video views.

For one thing, it's finally starting to show commercials that run before shows even start. Many of The Dodo's series, for instance, now come with 15-second spots before they begin.

Facebook had long resisted so-called pre-roll ads because CEO Mark Zuckerberg was convinced they would turn off viewers. But publishers wanted to be sure they could serve an ad before viewers drifted away—instead of counting on people to stick around through the first commercial break.

"If mid-roll was the only offering, it's just not that sexy," says a Watch publishing executive, who spoke on condition of anonymity. "Mid-roll on its own wouldn't be enough to make publishers happy. Pre-roll makes it more interesting."

Facebook also is starting to let publishers sell their own ads, another big step. Facebook declined to comment for this story, but earlier this year it said it would start testing a program to let publishers sell ads directly into Watch. A number of publishing executives said that program is still in a limited testing phase, and it's unclear which media companies are participating.

Facebook typically delivers ads into Watch shows from its own pool of advertisers, brands that were already running video ads on the social network. The brands have to opt into the "ad breaks" program to have their videos appear in Watch shows and other videos on the platform.

The automated delivery has been a deterrent to many advertisers, hampering the growth of the mid-roll and pre-roll ads project. It does not give advertisers all the tools they need to be able to control exactly where their ads run, either in Watch shows or in live videos.

"We're having conversations with Facebook about managing block-lists," says an advertising executive, who spoke on condition of anonymity. "Right now, it's letting in a lot more creators into the monetization program and we want to ensure brand safety."

Facebook does let advertisers opt out of certain categories of content, themes and topics, and they can individually block certain creators, but it doesn't let them explicitly pick only the videos they want to support.

Advertisers would like to be able to pair up with publishers whose content complements the brand. "It comes down to what's a good contextual fit," the advertising executive says.

For instance, The Dodo recently did a direct ad deal with the new movie "Dog Days." The Dodo created Facebook videos, outside of Watch, for the movie and promoted them through its Facebook page. If publishers could sell Watch commercials, then The Dodo would be able to show trailers for the movie in its shows, like the TV ad market.

The Dodo declined to discuss Facebook's plans to give publishers the ability to sell ads.

Emotional rescue

Facebook sent publishers into their latest platform panic in January, when it announced major changes in the wake of its troubles over fake news, foreign infiltration, hate speech and all-around toxicity. To change the tenor, Facebook said it would boost the signal of messages from users' personal friends while lowering the frequency of posts from media companies. It was a shock to publishers, which feared declines in traffic to their sites from Facebook and on their Facebook videos and articles.

"When we use social media to connect with people we care about, it can be good for our well-being," Zuckerberg said in his annual New Year Facebook post. "We can feel more connected and less lonely, and that correlates with long-term measures of happiness and health. On the other hand, passively reading articles or watching videos—even if they're entertaining or informative—may not be as good."

The changes meant less emphasis on viral videos of the sort that The Dodo has done so well in the past, but the publisher was ready for the changes, says YuJung Kim, president of The Dodo.

"That change specifically was a godsend for us," Kim says. "It's exactly what we wanted to happen for us. Viral videos, they're a secondary part of the business, and we're putting storytelling at the center of what we do, gravitating toward stories of more substance."

Facebook issued new marching orders to the publishing world to focus on building more meaningful communities around their content. It was looking for Watch shows that would generate more emotions, drive repeat viewers and prompt more conversations, and not just rack up views.

The Dodo has amassed views with cute, hard-not-to-click animal videos, but its executives say they're happy the Facebook has turned its algorithm away from such 'viral' content.
The Dodo has amassed views with cute, hard-not-to-click animal videos, but its executives say they're happy the Facebook has turned its algorithm away from such 'viral' content. Credit: The Dodo via Facebook

One of the ways publishers like The Dodo responded to Facebook's new criteria was to focus on "groups," the private boards on the social network for people with shared interests. The Dodo built a million-person Facebook Group around pit bulls for the show "Pittie Nation."

In June, The Dodo's shows generated 500 million minutes of watch time, which represented a 400 percent increase from the beginning of the year, according to Facebook analytics that the publisher shared. Across all platforms, including Snapchat and YouTube, Dodo videos generated 2.1 billion minutes of total view time, meaning Watch represents about a quarter of its viewership.

"We have the most-loved shows on Facebook," Kim says—basing that on the actual number of times that people hit the "love" reaction button on its videos. The Dodo's shows inspire people to hit "love" 70 times more than the average Watch program, according to CrowdTangle.

Like the number of views or shares or average view time, emotional reactions have become an important gauge on Facebook Watch.

"Emotional storytelling is our bread and butter," Zelman says.

Cash control

The views and emotional metrics are promising, but The Dodo and the rest of Group Nine remain focused on yet another, insistently important side of the data: how much money a program can make.

Facebook recently started driving a harder bargain in underwriting Watch content, demanding to own any shows it pays to produce, according to a number of publishing executives who work closely with the social network.

That made the economics of producing a new show much more demanding.

Like so many other publishers, The Dodo is on Snapchat, YouTube, Twitter and Instagram. And publishers want the rights to their content so they can distribute it across platforms. A number of publishers are even posting shows on Watch that were previously created for other platforms, sparing them the cost of a whole new property.

The Dodo invested heavily in YouTube over the past year, and saw its following on Twitter triple over that time, too, Kim says. It branched into TV in June with the premiere of "Dodo Heroes" on Animal Planet.

"We get a lot of mileage out of videos," Kim says.

Despite Facebook's focus on Watch, The Dodo, like a lot of publishers, hopes for a future where it can not only set its shows to appear on all platforms, but also sell advertising directly and deliver the ads seamlessly.

Lerer is optimistic. "We're moving in that direction," he says. "All platforms have the opportunity for big publishers to direct-sell inventory, turn brands on, at scale, across all the pipes." 

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