I know I keep going on about it, but the most important moment in marketing communications history probably took place on 6 November 2007. Ten years ago Facebook was a force to be reckoned with in popular culture terms but the big question, to use the recurrent phrase from that era, was whether this could be ‘monetised’?
Back then Facebook generated a paltry $153m in annual revenues – a figure it now makes every 48 hours. In 2007 many analysts were impressed with Facebook’s audience size but were uncertain that the company could turn it into profit. It was to allay these fears that Facebook invited 250 marketing and advertising executives to New York in November for that now famous presentation from the company’s 23-year-old founder.
What Mark Zuckerberg told the assembled executives that day laid the foundations for a system that will surely become, not too far off in the future, the biggest advertising business the world has ever seen.
That said, the actual content of Zuckerberg’s pitch that day turned out to be almost completely bogus. His new concept, Facebook Ads as he called them, was billed as a “completely new way of advertising online”. The old model of advertising that had dominated the last century, in which advertisers “pushed” messages at consumers, was going to be superseded by a different model in which advertising became “part of the conversation”. It was to be a new kind of ad system to spread messages virally.
Immediately after the announcement the first 40 big brands – including Coca-Cola, Sony, Dove and Blockbuster (yes it was that long ago) – launched the first corporate pages onto Facebook and the new era of social media marketing began.
Social media’s broken promise
You remember those heady days? The ‘Oreo Tweet’ at the 2013 Super Bowl was heralded as massively impactful despite reaching barely a fraction of 1% of the target market. Social media agencies sprung up all over the globe predicated on a new viral approach to marketing and an organic way of interacting with consumers that patently did not work but equally patently attracted a lot of investment. Companies set up social media teams to connect with customers and then blanched at the single-digit interactions that resulted.
We were all going to have one big, happy conversation with consumers. The drab, old grey world of cluttered manipulation that constantly besieged the customer with ads was over and a rainbow of natural and open dialogue between brands and their consumers was appearing above us.
Except that all turned out to be utter cock. Social media remained a cultural revolution but brands and their commercial agendas were entirely and completely rejected from the dialogue that Zuckerberg had promised them they would access. One of the main factors in that failure to engage was Facebook itself, which actively and openly reduced the organic reach that brands could achieve on the platform.
And so, after promising a new brave world of advertising that would chase away the clouds of the old ‘push’ approach to marketing communications, Facebook quietly and rather deliciously did a 180-degree turn and ended up becoming simply another intrusive, entirely commercial medium for brands to advertise on.
Sure, you get better segmentation options and more granular targets. Yes, you get access to consumers and their data on digital platforms that did not exist a decade ago. But rather than becoming the replacement for traditional media advertising, Facebook ads simply became their bastard child. In the unspoken revolution that no one in marketing likes to talk about – because it means admitting we all went a bit mental for something that made no sense – ineffective organic social media conversations became effective digital media advertising. Facebook, remarkably, was the agent of change and the ultimate beneficiary of the return to basics that followed.
Facebook’s big bait-and-switch
The question is not whether this all happened but whether Facebook deliberately engineered the whole thing. Did it always plan to ultimately become just another advertising medium? Or did it genuinely believe it was disrupting the whole paradigm of advertising, only to pivot much later as the whole organic conversation approach turned to pants and the obvious opportunity opened up to run a slightly updated version of print and TV ads, albeit on a digital platform? Perhaps we will never know. Perhaps Facebook doesn’t really know.
Either way it has turned into a brilliant strategic move. You destabilise the traditional mode of advertising, you get loads of client interest and disrupt the existing status quo, and then you gradually track back to a more traditional model and assert yourself atop that newly reinforced system as the king of all you survey. It’s the ultimate example of a bait-and-switch. You offer one thing – change and revolution – and then imperceptibly switch those who respond back to a brand new version of the same old stuff.
It’s worth drawing all of this out. Partly because it’s just an amazing moment in advertising history. Partly because the strategic confidence required to pull this off takes your breath away. But also because it’s all about to happen again. Those who cannot remember advertising’s recent history are most likely consigned to repeat its errors once more.
Specifically, take a long hard look at Facebook’s competitive and rather sassy view of television. The company’s chief operating officer Sheryl Sandberg famously dismissed the power of even the biggest TV broadcast when she told Advertising Week New York two years ago: “We have a Super Bowl on mobile every day.” Zuckerberg has been even more brazen about the end of TV, predicting earlier this year that augmented reality and a $1 app would eventually replace the TV set completely.
But look at the Facebook strategy more closely, perhaps with a touch more cynicism than the average digital marketer might apply to the situation, and it becomes apparent what is actually going on. It’s Bait-and-Switch Part Deux.
The birth of Facebook TV
I believe Facebook is actively belittling and undermining television because once it has done that it can run another, even bigger ,bait-and-switch than the last one. First, persuade advertisers that TV is busted. Then, become the dominant force in TV advertising and add another $200bn to revenues.
Let me prove the point. Here is NBC executive Alan Smithee taking about how he and his company intend to defend its business against Facebook with a renewed focus on the TV experience: “The experience is designed to deliver on that promise that you want to watch videos, you want to keep up with the content that you watch episodically week over week. This is going to be the place where you go to do that.”
It’s a relatively conservative and traditional approach to TV, right? Right. But it’s not a quote from Alan Smithee – I made him up. It’s part of Zuckerberg’s speech from his Q4 earnings call earlier this year about Facebook’s new growth strategy.
For all the talk of the flaws in traditional TV advertising and the death of TV, the reality is that Facebook is dead set on becoming a de facto TV channel sooner rather than later. That’s why it has a Facebook video app for Samsung smart TVs and Apple TV. That’s why it is currently developing more than 20 long form TV-style series to run exclusively on Facebook. That’s why the company is screening a series of college football games in America this year. And it is also why the company bid $600m to acquire the rights to the Indian Premier League cricket tournament (IPL) this week. In the end the bid was dwarfed by that of Star India, which was determined to broadcast the biggest sporting event on the Indian sub-continent. But the precedent and intent are clear.
Facebook is not intent on taking away TV advertising revenues by switching them to digital media. It wants to undermine those that currently benefit from TV advertising and then move in and take the lion’s share for itself. Based on history there is every possible reason to suspect it can pull this off and run a second, even more spectacular, bait-and-switch.
And just as digital marketers proclaimed the death of traditional advertising and then spent the ensuing 10 years designing display ads to target consumers in a manner not dissimilar from their 19th century predecessors, those that constantly predict the end of TV advertising will shortly start inserting six-, 15- and 30-second ads into half-hour content like it was 1965 all over again. The content in question might now feature Gary Vaynerchuk rather than Tommy Cooper, but the essential dynamics of the show and the advertising and the philosophy behind it remain essentially unchanged.
TV is dead, long live Facebook TV.
Professor Mark Ritson will be teaching the next class on the Marketing Week Mini MBA in Marketing from September 2017. To find out how it could make you a more confident, more effective and more inspired marketer, and to book your place, click here.