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Facebook has shifted focus to short-form video after the stock market loss

Spire News Team by Spire News Team
February 7, 2022
Reading Time: 3 mins read
0
Facebook Has Shifted Focus To Short-Form Video After The Stock Market Loss

Facebook’s video strategy is a way to regain momentum after a dramatic drop in stock prices.

ADVERTISEMENT

After the biggest stock market drop in recorded history, Facebook CEO Mark Zuckerberg plans to shift the company’s focus to short-form video.

This plan was communicated by Zuckerberg to Facebook employees via a virtual meeting.

After reporting significant losses in its quarterly earnings report, Meta Platforms Inc. saw its stock price drop by more than 200 billion dollars.

Facebook experienced its first-ever decline in daily active users, not only did its expenses exceed its revenues but also the expense of Facebook.

Fast half a million Facebook users stopped using Facebook daily between the third and fourth quarters of 2021.

After learning details about Facebook’s quarterly report, investors panicked and the stock crashed.

The reason behind shifting focus to short-form video?

Zuckerberg explains that TikTok is the reason for the decline in daily active users. Zuckerberg blames TikTok for the company’s poor performance.

Meta’s vision for the future is the reason for the high-priced expenses it incurred in the past quarter. Meta is in a spending frenzy, trying to make the Metaverse the next big deal — an investment that has yet to pay off.

Meta is not only incurring more expenses but also bringing in less revenue from advertising. Apple’s App Tracking Transparency feature may be reducing ad revenue.

This feature was added last year and limits the ability of iPhone applications to track user data. This decreases the targeting capabilities for Facebook ads and leads to lower engagement from users.

Advertisers will spend less if they don’t get a satisfactory return on their advertising spend. Combining higher expenses, lower revenues, and the loss of users, led to a massive plunge in stock prices.

What does this mean for Facebook?

Facebook has decided to tackle the TikTok problem instead of attempting to solve its advertising problems. Facebook will compete with TikTok, by promoting short-form video as its main draw.

According to reports, the company now prioritizes Reels, a TikTok-inspired video feature that is available on Instagram and Facebook.

Zuckerberg stated this in a conference call with investors:

People have many options for how they spend their time. Apps like TikTok and others are rapidly growing. This is why Reels is so important in the long-term.”

Since 2020, Instagram has been moving in the right direction to become a video-sharing platform. Now it seems like Facebook is following their lead.

What does this mean for Facebook marketers?

Video is the future of social media marketing, according to the signs on the walls.

TikTok is flourishing, Instagram has prioritized video for more than a year, and Facebook now pivots to video.

Based on Snapchat’s recent earnings report, Snapchat has turned a profit for only the second time.

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Social media users are expressing their desire to be super-served by video content.

It’s now up to social media marketers, to fulfill the demand. Video editing and production should be a part of your skillset. You need to keep up with the latest video trends if you don’t already.

Social media was once dominated by text and images. Video is almost an absolute necessity. Production is not difficult, thankfully. 

Reels and TikTok are both built around vertical video, and anyone can create them with their smartphone.

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