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Meta says it’s moving away from feeds that are dominated by content from accounts a user is following to an “AI recommending content that you’ll find interesting from across Facebook or Instagram, even if you don’t follow those creators,” said Zuckerberg. “Reels is one part of this trend that focuses on the growth of short-form video as a content format, but this overall AI trend is much broader and covers all types of content, including text, images, links, group content, and more. . Building a recommendation system across all these types of content is something we’re uniquely focused on.” The run rate on Reels has now reached $1 billion.
Meta blamed its sales decline on a slowdown in advertising revenue growth. The pivot to Reels is making it difficult for advertisers to advertise on Instagram, analysts say. “In order to monetise Reels, you’re asking advertisers to create new ones advertisements,” says Mark Shmulik, senior analyst at consultancy Bernstein, adding that advertisers will be slower to embrace Reels as it requires them to break away from old advertising habits and transform their original content into video content. The challenge becomes ensuring that “consumers engage with advertisements on that format the same way that consumers have already been on news feeds and stories”.
Video could be “where the world is going”
Instagram is facing fierce competition from TikTok. “TikTok has been the fastest growing social media platform that GWI has ever seen, not just in terms of user base but also in terms of users saying it’s their favorite platform,” says GWI’s Beer. Increasingly, watching “funny” content (which is more associated with short-form video) is the number one reason to visit social media across platforms like Instagram, TikTok and YouTube, he says.
Creators feel the Instagram changes are a tension between the old and the new guard of Instagram users, but Beer says that in fact there’s a lot of overlap: 72 percent of Instagram users who log on primarily to share photos also say they use Instagram to consume funny content (which is more associated with Reels), according to GWI. “More people go to Instagram for ‘trendy’ content than any other platform, but ‘funny’ content is still the most-desired.”
Whether its Instagram or TikTok, static content is no longer the priority as creative marketing agencies like Billion Dollar Boy, which produces between 4,000 and 6,000 branded content ads a month, are moving towards more motion-based content. “For a long time, Reels have been what we’ve been promoting as a business heavily because the success and performance is far better than other types of content,” says CEO and founder Edward East.
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