In 2015, BuzzFeed gave its employees a take of creating the perfect viral video on Facebook. The video had to be short less than forty seconds and enjoyable with or without the sound while people scrolled through their Facebook feed to ensure maximum share-ability. The BuzzFeed team found the solution in how to cooking videos and soon the videos made by the company’s sub brand Tasty became a viral sensation on the social media platform. The worldwide success of the Tasty videos did not go unnoticed and many media companies started investing in creating short videos to be shared across social media and watched, muted or with sound, on mobile devices. With brands expected to spend $22 billion on video ads in the U.S. by 2022 — a 68% jump from 2017, according to eMarketer — social media platforms will most likely be flooded with even more shorter video clips in the next couple of years.
But with the shift to video and increasing interments in social media platforms, this popular marketing strategy is proving you be less lucrative to publishers. Top Digital publications including Mashable, Uproxx Media Group, Fusion Media Group and Defy Media — all of which have invested heavily in video— either sold or are looking to sell ownership stakes in their companies, according to various media reports. In addition, Vice, Mic and BuzzFeed each announced layoffs this year after doubling down on video.
“I see digital video as little more than an iteration of the banner ad,” said Pivotal Research advertising analyst Brian Wieser, referring to the easily ignored advertisements atop web pages, which once were core to online publishing but since have yielded diminishing returns.
One issue that publishers are facing is the video marketplace which is becoming increasingly crowded. Moreover, Publishers are concerned that Facebook and Google — which together make up 63% of total U.S. advertising dollars spent online, according to eMarketer — eventually could extract an even larger share of the revenue generated from video ads, Wieser said.
“Google and Facebook are taking the vast majority of ad revenue and paying content creators far too little for the value they deliver to users,” BuzzFeed CEO Jonah Peretti wrote in a memo on the state of digital media.