Live-streaming presents opportunities, challenges for advertisers

As video becomes an integral part of the social web, live-streaming has fast become one of the hottest trends.

Spurred by the early success of Meerkat and Periscope, in April, Facebook launched Live, its own live-streaming feature. Reportedly, Facebook CEO Mark Zuckerberg is “obsessed” with live-streaming and believes Live is critical to his company’s future.

With that in mind, it’s probably not a coincidence that he personally announced Live’s launch, writing, “Live is like having a TV camera in your pocket. Anyone with a phone now has the power to broadcast to anyone in the world. When you interact live, you feel connected in a more personal way. This is a big shift in how we communicate, and it’s going to create new opportunities for people to come together.”

While Facebook’s billion-user plus audience gives any new product it launches a good shot at success, Facebook didn’t want to leave anything to chance, and has reportedly. invested tens of millions of dollars luring publishers and celebrities to Live.

Now that it has some traction, it’s no surprise that Facebook has started testing mid-roll ads in Live streams. Per AdAge:

The ads are eligible to appear five minutes into a broadcast, and they last up to 15 seconds or shorter, according to one agency executive, who has discussed the ads with Facebook.

Facebook told advertisers that the video ads would be drawn from among promoted video campaigns already running on the platform, but some brands could opt out of having their ads appear during live broadcasts, the source said. “We wanted to opt out immediately, because there was no reporting on how well it does and you don’t have control over where the commercial shows up,” the agency executive said.

Facebook isn’t alone in trying to capitalize on live-streaming. Its rival, Twitter, is taking a slightly different approach by purchasing the rights to live stream professional sporting events. Its deal with the NFL to stream Thursday night football games is said to have the potential to generate more than $50 million in ad revenue.

Real-time challenges

Live-streaming in all of its forms offers advertisers new ways to reach consumers through engaging, impactful video content that many consumers seem to be enamored by.

But there are numerous challenges to building a robust live-streaming ad ecosystem.

The nature of live-streaming means that advertisers won’t necessarily have as much control over the type of content their brands are being associated with. Recently, Facebook Live made headlines when it was used to broadcast high-profile police shootings.

To prevent advertisers from finding their ads on live-streams like this, Facebook can limit Live ads to specific streams created by specific publishers and individuals, but there’s still an element of unpredictability that will always exist with live-streaming and it will be difficult for advertisers to scale their use of Live for marketing purposes if Facebook severely restricts where ads are displayed.

Furthermore, as Twitter’s NFL ad packages demonstrate, advertisers are probably going to be asked to pay a premium for live-streaming ads, particularly those that are associated with professional sporting events and the like.

So advertisers will have to determine if live-streaming’s television-like ad prices deliver, at a minimum, television-like reach and results.