Facebook doesn’t expect its video auto-play News Feed ads to make a “material contribution” to ad revenues this year, COO Sheryl Sandberg said on Wednesday.
In a call with analysts following Facebook’s first-quarter earnings announcement, Sandberg said the company is waiting for users to get used to seeing auto-play video in their News Feed before making auto-play ads more common. “In terms of expectations for that, we really want to see auto-play video ads be something that’s pretty common in the News Feed experience based on consumer usage before we push very hard on the ad business. So we remain long term very excited, we do expect that product to [remain] a premium product, but as I said in my remarks, we won’t see a material contribution from it this year.”
The social networking giant has been showing advertisers a video ad unit since early 2013. After pushing the launch back a few times that year, Facebook officially announced video ads last December with a limited number of brands. In March, the company said 15-second Premium Video Ads would roll out with a “select group of advertisers” over the next few months.
Facebook’s desire to maintain the News Feed experience is one factor prompting the company to slow the video ad rollout. Media execs have pointed out that the ads are relatively expensive and lack the fine-tuned targeting of standard Facebook ads. In addition, it’s difficult to craft ads that are meant to be silent yet eye-catching enough to prompt users to click.
Sandberg also acknowledged that Facebook is working on a mobile ad network, another initiative that has been rumored for some time. The network would be a mechanism through which marketers can buy ads on mobile that will appear on Facebook, but also on other, unrelated sites and apps. Like video ads, she said she doesn’t expect the mobile ad network to make a material contribution to revenues this year.