Facebook is taking a page out of the modern TV playbook – it now lets consumers purchase subscription streaming services through Facebook Watch.
The social giant announced last week that it’s adding BBC and ITV’s BritBox, Tastemade Plus, CollegeHumor’s Dropout and MotorTrend On Demand to Facebook Watch in the US only.
Established content hubs in OTT such as Amazon Fire TV, Roku and Apple TV have long offered subscription video on demand (SVOD) services a rather straightforward pitch: Lean on our scale to reel in new subscribers by selling via our platforms and save on costs associated with marketing your service.
Facebook, like it’s competitors, will take a cut of that subscription revenue. Unlike its competitors, Facebook can target its highly engaged and easy-to-find audiences.
Tastemade, for example, has 30 million followers on Facebook. Jeremy Strauss, head of business development for Tastemade, called that audience an “easy first opportunity” to reach new subscribers.
“That’s our first emphasis out the gate,” said Strauss, “is capturing a share of our audience and extending that audience engagement onto this new offering [to go] beyond watching content on newsfeeds or in Watch on an ad-supported fashion.”
Facebook’s recent marketing campaign has put an emphasis on groups to distract from brand safety crises and data malpractices but that sense of community the social-giant is propping up could help it promote its new TV play.
Paul Greenberg, former CollegeHumor chief executive officer and current boss of digital video firm Butter Works, said the crowded SVOD space makes it hard for smaller players to stand out, but Facebook’s groups make it easier to find audiences.
“If they really wanted to they could target comedy fans who are in Facebook groups and market the service there,” said Greenberg. “They have more data than anybody. They can target those audiences really well.”
Facebook wouldn’t comment on whether it’s looking for more partners, only saying it will be “listening closely to feedback from our partners and the community overall.”
Facebook may have simply chosen not to pay up for bigger brand names such as HBO or Showtime, but its niche play in TV could differentiate its service from the likes of Amazon Fire TV, Roku and Apple TV that all offer an array of general content.
“These are very specific brands,” said Greenberg. “I think that gives them a different take to get started, and they’ll get very loyal fanbases who love those brands, but who may not even know that CollegeHumor had an SVOD.
“It’s not quite us too in the sense of, ‘Hey we have the same offering that Amazon and Apple do.’ It’s different. Whether that was by design or not I think that was really helpful.”
When it comes to marketing, Strauss said Tastemade Plus can take a new approach to advertising on Facebook as he expects its new distribution partner to be out in the market promoting its new TV offering.
Strauss said that while bringing in subscribers can be difficult – and marketing costs associated with that can be high – the bigger challenge lies around overcoming churn and bringing subscribers back.
“Acquiring that customer is easy but… on CTV there’s all these different apps and services demanding of attention,” said Strauss. “How do we ensure that even once we get that user, they’re routinely coming to our app and opening our app to reduce churn? That is often the biggest challenge of any subscription service.”
Greenberg said that during his time partnering with Facebook Watch while overseeing digital video at A&E Networks from 2016-2018, Facebook’s newsfeed was a main marketing tool
“I think it’s a lever Facebook can pull when they want,” said Greenberg. “They’ve got billions of people on their main feed. That to me is how they can dial it up and dial it down.”
Facebook said in June that 140 million people spend at least one minute on Watch daily. Netflix, in comparison, boasts 151 million subscribers.
Frank Sinton, president and founder of Beachfront Media, said that a major hurdle standing Facebook’s way is that Watch still isn’t seen as a “go-to” for content consumption.
That may not matter, however, if Facebook can convert even a fraction of the low-hanging fruit Tastemade Plus and the three other launch partners are to target.
“If Facebook can somehow use their groups and niche-based interest groups to attract attention to this content, that’s where it could be really interesting,” said Sinton, adding that content discovery is a big challenge on the entrenched streaming platforms.
“That’s potentially where Facebook can actually make a huge difference and be able to drive subscriber growth to more niche audiences.”
Tastemade Plus costs $2.99 per month, BritBox costs $6.99 per month, and CollegeHumor and MotorTrend On Demand both cost $4.99 per month.
Facebook said it would be providing each publisher with aggregated, anonymized subscriber data, but not specific information such as email addresses.
Strauss recognized this give-and-take nature of most publisher-platform relationships, but said Tastemade is more focused on the bigger picture.
“At the end of the day we look at it less about the individual subscriber level. It’s reducing the friction in signing up for a new service by integrating it directly within the platform,” said Strauss.
“Yeah, are the economics slightly less on a per-subscriber basis, but in the aggregate it adds a lot more revenue and huge subscribers numbers just by the virtue of users spending time on Facebook every day.”