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State of the Screens

Facebook Is Now Pitching Advertisers on TV-Style Upfront Buys for Premium Video

By March 5, 2019No Comments

Facebook is offering an “upfront” buy through a new program called Showcase.

The details:
1) Video ads bought at a fixed/negotiated price
2) Verified by Nielsen
3) CPMs are ≈ $23–25
4) 43% of Facebook Watch audience is 18–34 vs. 28% for linear TV
5) ≈ 100M users in U.S. consume premium video content through Facebook

Video: Facebook Is Going After TV Ad Dollars with Brand-Safe Shows

U.S. share of digital time per day for Facebook:
1)
2017–9.0%
2)
2018–8.9%
3)
2019P — 8.9%
4)
2020P — 9.1%

Keep in mind: Facebook accounts for ≈ 20% of digital ad spend!

Facebook ad revenue per user hour (YoY growth):
1)
2017 — $0.45
2)
2018 — $0.60 (↑ 33%)
3) 2019P — $0.71 (↑ 18%)
4) 2020P — $0.82 (↑ 15%)

Quick math on linear TV ad revenue per hour assuming:
1) 12
minutes of ads/hour
2) 24 spots/hour
3) $25 CPM
4) $0.60/hour of viewing time

If we assume both figures above, then 1 hour spent in the Facebook news feed is delivering more ad revenue than 1 hour watching linear TV (100% video).

More #1: ‘Decent learning curve for them’: Facebook will need to adapt its pitch to crack TV upfront market

More #2: Facebook Watch has a new program to fund publisher shows starring influencers

More #3: Social Video Also Needs A Measurement Standard. Fortunately, Help Is On The Way

Michael Beach

Michael Beach

Michael Beach is the Chief Executive Officer of Cross Screen Media, a media analytics and software company that enables marketers to plan, activate, and measure CTV and linear TV at the local level. Michael is also the founder and editor of State of the Screens, a weekly newsletter focused on video advertising that is a must-read for thought leaders in the advertising industry. He has appeared in such publications as PBS Frontline, The Wall Street Journal, The New York Times, Axios, CNBC and Bloomberg, and on NPR’s Planet Money podcast.

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