Facebook challenges Zoom with Messenger Rooms, lures e-commerce advertisers with live IGTV
Facebook CEO Mark Zuckerberg delivered a livestream on Friday to announce the company’s retooled video products, prioritizing the potential for users to connect while at home under quarantine. The video updates also fit perfectly with Facebook’s advertising plans, with a focus on e-commerce, according to ad agency clients.
The biggest product launch was that Facebook Messenger will open what are called Rooms, which will allow 50 people to “hang out” at a time. Facebook has seen the success of newcomers like Zoom, the videoconferencing site, which took off when companies sent employees to work from home. Zoom says it went from about 10 million users a day to 300 million a day currently, and it has become a part of the fabric of many people’s quarantined lives.
Now, Facebook is opening Messenger Rooms, which will offer a social twist to the videoconferencing space. Zuckerberg described the testing process, noting he has kept a Room open on his computer so any one of his friends and co-workers could just drop in throughout the day, making it a less-scheduled experience than a Zoom conference. Zuckerberg said there were controls that would prevent “annoying” people from just entering, if the chat host wants to screen visitors.
Messenger Rooms will eventually also integrate with Facebook’s other properties Instagram Direct, WhatsApp and Portal, the home-video device, Facebook said, which is an indication the company is developing its product roadmap with an eye on full integration of all its disparate parts. Facebook did say that people could be invited into Messenger Rooms without having a Facebook account. “You should be able to invite anyone you want,” Zuckerberg said.
Facebook also has developed augmented reality and artificial intelligence that will help decorate video settings, much like the Zoom backgrounds that have become popular during lockdown.
The Portal is one of Facebook’s pet hardware projects, and it had seen slow adoption, until now, it seems. Since the start of coronavirus, Portal sales have increase tenfold, Zuckerberg said, and the company is trying to ramp up production to sell more.
Facebook also updated its nascent dating service, Facebook Dating, with a virtual meet-up feature that leads people to video chats.
What advertisers are interested in, however, are the ways all this video activity could lead to new opportunities. On that front, Facebook has enhanced IGTV, the Instagram programming hub, and Facebook Live. These are two products that Facebook’s ad sales teams have promoted in recent weeks, according to Ellie Bamford, head of media at R/GA.
Facebook is creating advertising that can fit these environments, particularly within areas that are the hottest among consumers at the moment, like home fitness and cooking, Bamford says. Facebook is telling advertisers that there will be more e-commerce taking place on the platform, and IGTV and Facebook Live will be open for business.
“They’re fast-tracking a whole bunch of new ad units and ad models that exist within video that are tailored more to those experiences,” Bamford says. “[And] that are also tailored more to e-commerce.”
With the coronavirus pandemic shutdown, digital platforms like Facebook have seen a spike in audiences and users have been open to testing out new sides of the platforms. For instance, IGTV has been an under-appreciated video offering ever since its launch in 2018, where top publishers and creators post longer-form video series. In March, IGTV and Facebook Live audiences rose dramatically, Facebook said. Zuckerberg said that 800 million people are watching livestreams on Facebook and Instagram every day.
In the announcement Friday, Facebook highlighted how creators could use IGTV and Facebook Live as channels for workout programs and cooking tutorials. Facebook will now allow the creators to livestream to IGTV and will show the programs on desktop, not just mobile devices. The move to desktop is another sign of how the pandemic has transformed the way people are using platforms, with more viewers visiting on their laptops from home.
Advertisers of athletic wear and cooking products could inhabit those spaces, Bamford says. “That opens the door to obviously more e-commerce-driven, click-to-buy, shoppable ad units directly within content,” she says.
“With the new ability to go Live from Facebook Portal to Pages and Groups, people and businesses can start to create even more interactive content on their Portal for their communities and customers,” Facebook said in its announcement.
Facebook is set to report quarterly earnings next week, and the company has already announced that revenue has been negatively affected by the coronavirus crisis. Many advertisers are pulling back on spending and Facebook’s online ad auction has seen prices reduced. On Friday, a note from eMarketer said the price of Facebook ads and the amount of money it makes from each unit sold, have declined as much as 50 percent in some categories.
“Those losses will be made up for by gains in categories that increased their use of Facebook advertising at the end of March, either to market products or services aimed at people staying at home, or to take advantage of drastically lower ad costs,” said Debra Aho Williamson, principal analyst at eMarketer, in her note.