Does TikTok Create a Second Pivot to Video?
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Anytime I think about publishers creating native video on social media platforms, I’m reminded that the pivot to video has its own legitimate Wikipedia page. And with TikTok having a bit of a moment right now, could publishers do it all wrong again?
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Now let’s jump in…
Over the past week, Digiday has published a couple of stories about what some publishers are doing on TikTok. First, it had reported that Buzzfeed had signed an annual deal with TikTok:
Tasty’s editorial team and branded content team, as well as BuzzFeed’s creator and talent teams, are working with TikTok to create the shows’ content. “We are essentially the production: They own the partnership; we own the content,” Blom added. Both companies declined to answer questions about how much money each party stands to make from this deal, though a BuzzFeed spokesperson confirmed the two sides are sharing the revenue.
The deal serves as a pilot program of sorts for developing how publishers like BuzzFeed can work with TikTok to generate direct revenue on the platform. Similar to how TikTok is exposing BuzzFeed to new advertisers like Cyetus, BuzzFeed can open TikTok advertisers that may be looking for a guiding hand to investing in running branded content on the platform.
And then, on Monday, it published a story on how publishers are assessing performance on TikTok:
Views may provide the most obvious and eye-catching stat for publishers and creators on platforms like TikTok. However, video makers are looking at different in-depth metrics to understand how to succeed on TikTok, including average completion rate, the growth rate of views and the percentage of views coming from people who do not follow their accounts.
“One thing I’m paying more attention to is the acceleration of views. Is this something that’s trending?” said one media executive.
Although publishers may have particular metrics they monitor closely, the one that they seem to be paying special attention to is a video’s average completion rate, or what percentage of a video’s duration the typical viewer watched. “We want a 90% average percentage watched, not 40 seconds average watch time,” Raja said.
If there is one thing I’ve learned working around journalism for a while now, when there are multiple stories coming out about a single platform, it’s because a lot of media are talking about it. And for good reason. TikTok has exploded in popularity (I had to delete it because it is so addictive). And, unlike other platforms, it is actually built for growth.
Unfortunately, this feels like it could become the same ol’ strategy of building for whatever the platform deems success to be. In both instances, I am getting hints of what publishers were talking about when Facebook was pushing its video product. That, ultimately, turned out to be a colossal flop.
But does it have to be a recipe for disaster? Or, could publishers actually get it right this time with a platform?
A big concern has to do with the terms of the deal. Too often, I’ve seen publishers get a big chunk of cash from the platforms, hire a bunch of people, and then ride that money to zero. Then they’re left with a team that they don’t have the resources for and that’s what leads to layoffs.
Jon Steinberg, formally of cheddar, has a great quote that I always return to when these conversations come up:
Always take the check. But you are never getting another check, so you either take the check and staff it in a way that you can do it and shut it down without hurting your people, or you figure out a way to make it self-sustainable.
And he’s right. If these deals with the platforms require a big investment on your part, think very hard about it. 99% of the time, the rug’s going to be pulled out from under you and then you’ve got to be the one to hurt your people. It’s just not a good system to play it.
But does this inherently mean that building on any platform is a bad idea? It may come as a surprise since I tend to be pretty anti-platform, but they don’t have to be bad. I just think we have to be smart about what we create.
If we look back on the pivot to video, the goal was to game the algorithm. If we can create a ton of video, distribute it on the platforms, get a cut of the pre-roll advertising, then we’ve got a business. That, unfortunately, failed pretty miserably.
Compare that to what BuzzFeed is building:
“I Made This” is the first series to come out of the deal. Coming from BuzzFeed’s cooking vertical Tasty, the eight-part series features live cooking videos for different events and holiday celebrations, such as Friendsgiving, a tailgate party, date night, Diwali and Hanukkah, and stars in-house and independent creators that BuzzFeed works with. The first episode aired on Nov. 3. Episodes will come out every Wednesday through Dec. 22 and stream live on Tasty’s TikTok account.
This is an appealing approach for two reasons. First, it directly ties into audience engagement. Live cooking videos bring people into the experience. Second, it’s through BuzzFeed’s Tasty brand which has become a major success for the publisher. They’re making contextual content that its audience might actually want rather than trying to game an algorithm. That’s compelling.
One risk here is that the money dries up. Do brands decide they don’t want to distribute through TikTok videos at some point? Does TikTok itself decide it doesn’t want to work with publishers? Does an algorithm change occur where videos are seen less and that results in poor performance? Or, does TikTok just start treating every publisher like a factory, devaluing any individual piece of content, which is never a good place to operate?
These are all the questions that publishers have to prepare for when looking at platforms. But where I see real value for these platforms is less the direct monetization via advertising and more the indirect monetization via commerce. If you’ve got an audience’s attention and you’ve built a brand, can you sell something to them directly? That’s where I think the real opportunity exists.
Performance is here to stay
In April 2020, I wrote the following:
I believe that publishers are going to have to prove their value to their partners—advertisers and readers—more than they ever have before.
With advertisers, that means you have to prove you’re driving business. Business publications have grown very comfortable doing this, but for consumer brands, it’s more uncharted territory.
The big brand budgets may one day return, but I think what we’ll find is the publishers that figure out how to tie their revenue more closely to the consumer dollar will wind up having the most success post-COVID.
It had to happen. At some point, advertisers were going to look at all the money they were spending and try to determine if any of it actually mattered to their business. It seems that day has come.
According to Digiday:
As 2021 has worn on, more advertisers are asking that ad deals typically measured using upper-funnel metrics such as brand awareness or social lift — branded content campaigns, for example, or event sponsorships — be measured using lower-funnel metrics like sales, or deliver guaranteed numbers of sales leads.
But for those that can deliver, it might also provide some stability to a revenue stream that, like most creative services, can be a bit lumpy and unpredictable. Josh Stinchcomb, the chief revenue officer of the Wall Street Journal, said the shift toward a performance mindset should improve renewal rates among advertisers, and consequently, more recurring advertising revenue.
Does this mean that we’re going exclusively performance-based? No. One goal of advertising is to drive awareness. It’s hard to imagine Ford trying to get people to buy a car thanks to a 300×250 advertisement. However, it’s going to be a part of the puzzle. If a hotel brand, for example, does a big ad campaign to make itself well known, it might also include actual booked nights as a metric it uses when further evaluating partners.
I think this is a great thing for premium publishers that actually have a direct relationship with their audience. Scale is no longer the end all be all. Instead, it’s about quality scale that is actually able to drive business for the advertiser. That’s the position we should want to be in because it separates us from lower-quality publishers. Compare that to how any programmatic ad impression was created equal so long as the cookie existed.
Smart publishers will look at building integrated plans for partners. And I think this is true for both B2B and B2C. We need to do a better job on the B2B side of helping our advertisers build their brands while also driving targeted business. What we’ll find is that it can’t be all performance and it can’t be all fluffy awareness. It needs to be both.
John Wanamaker reportedly said, “half the money I spend on advertising is wasted; the trouble is I don’t know which half.” The pivot to some performance spend is to better help marketers understand which half is wasted. This is a good thing for publishers even if it seems scary.
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