In June, HBO started streaming the premiere episodes of its new series Ballers and The Brink for free on Facebook (NASDAQ:FB) just a few days after they originally aired. Before that, Amazon (NASDAQ:AMZN) debuted the pilot of its newest series Catastrophe on the social network before it was available on Prime.
I previously wrote about Time Warner's (NYSE:TWX) and Amazon's decisions to offer their content for free on Facebook, noting that Facebook is capable of producing significantly more exposure for videos than YouTube. Facebook videos are easier to share, and Facebook's control over the News Feed means it can put pretty much anything it thinks you'll like in users' feeds.
But there's another big advantage Facebook has over pretty much any other video platform.
Retargeting made simple
At the end of Facebook's second-quarter earnings call, COO Sheryl Sandberg told analysts, "HBO used our video retargeting mobile app install ads on Facebook to drive downloads at HBO Now, and Facebook is now the number one channel driving subscribers."
In other words, HBO created an app-install ad campaign for its new HBO Now app that targeted Facebook users who had watched either Ballers or The Brink. Facebook offers tools that enable businesses to see what percentage of a video users watched, so HBO could specifically target users who watched at least 90% of an episode -- i.e., the entire episode excluding credits. The ability to target users like this produces a very efficient campaign that costs less and makes Facebook "the number one channel driving subscribers."
Google also offers retargeting capabilities with YouTube, where businesses can target people who viewed one of their videos. The search giant's huge network of advertising partners ensures there's a lot of inventory for advertisers to advertise on, but the biggest retargeting platform for YouTube views is YouTube itself. Still, retargeting YouTube views for app installs isn't the easiest task.
Additionally, app-install ads perform much better on mobile, where Facebook dominates. Between Facebook, Instagram, and Messenger, Facebook says it averages 46 minutes on mobile every day. YouTube recently reported that its average mobile session is 40 minutes long, but that includes time spent streaming music videos, and most of its ads are just suggested videos.
Over the top previews
As more and more services go over the top, including CBS, Showtime, and HBO, Facebook is one of the best places to preview new videos. Not only does it provide more exposure than any other platform, it gives those media companies an easy list of hot leads to display app-install ads to. Time Warner's HBO is the first company to use it effectively.
Netflix could benefit greatly from Facebook's global reach as it expands abroad. The streaming leader will start coming up against established local players in certain markets, and it could preview some of its originals on Facebook in those markets to increase app downloads and subscriptions.
Facebook could add more top quality video content
If Facebook went out of its way to convince media companies to upload their content to its platform, it could generate a nice stockpile of high-quality videos. Facebook is reportedly having trouble attracting talent from YouTube because of the established audiences big YouTube stars already have on the video-sharing website. But media brands and television stars generally have bigger followings on Facebook, which has allowed it to attract professionally produced videos from HBO and Amazon.
The sales pitch for Facebook is pretty straightforward: It should only cost the company a few phone calls and whatever it costs to put a pitch together. The payoff could be more high-quality videos and more big-budget app-install advertisers.