"Facebook Stories is currently crickets": It won't be easy for Facebook to sell advertisers on what it hopes is its next huge growth opportunity

facebook ceo mark zuckerberg gesture

Facebook sales reps have been aggressively selling Stories to advertisers, according to 10 media buyers whom Business Insider spoke to.
The move comes on the heels of its earnings call this week, where Facebook executives warned that its advertising growth rate slowing down.

Desperate times call for desperate measures.

With its News Feed nearly saturated and advertising growth rates slowing down, Facebook knows that it must look elsewhere to maximize profits.

That place increasingly appears to be Stories — the section that houses ephemeral photos and videos for 24 hours before they disappear.

While Stories are already hot on its sister platform Instagram, the format is yet to take off on Facebook itself. So it won't be an easy sell.

But the company is clearly making it a priority moving forward.

Not only did founder and CEO Mark Zuckerberg call Stories "a big part of the future of sharing" on the company's earnings call on Wednesday, Facebook has also been pushing the format to advertisers, according to 10 media buyers whom Business Insider spoke to.

"It seems as though Facebook is looking to replicate the success of Instagram stories by applying it to Facebook," said Brendan Gahan, founder at Epic Signal.

Every Facebook presentation starts with a slide on Stories

Facebook Stories launched in 2017, and the company just began testing ads on it in the US, Brazil and Mexico in May 2018. As a select few advertisers experiment with ads on Facebook Stories, its sales executives have been preparing for a much wider rollout.

In fact, Stories have been heavily emphasized at meetings and creative brainstorm sessions over the past few months, several media buyers said, encouraging them to test the format out. Facebook is even sharing tips and tricks with advertisers on how to crack the format, they said, like how Stories content should be modeled on memes, said one executive.

"In the last couple of creative workshops we've had with them, every presentation has started with a slide on Stories," said one media buyer.

Facebook wants to replicate Instagram Stories ads everywhere

It helps that marketers have tasted success with Instagram Stories ads. Online retailer Overstock, for example, saw an 18% increase in return on ad spend and a 20% decrease in cost per acquisition when it ran video ads in Instagram Stories with a shop now button, as COO Sheryl Sandberg pointed out in the call.

"Within the past few months it’s come up a lot more, with the theme being about Stories not just on Facebook, but also how it’ll play out in places like Messenger and WhatsApp,"said Noah Mallin, head of experience, content and sponsorship at Wavemaker.

The company is even providing free trials for Facebook Stories ads, said one buyer, handing over "several thousand dollars" in free media for Stories to incentivize buyers to test the feature.

"I haven't heard of specific metrics yet, but the general consensus is that it will be more of an awareness driving tool than something that will be used to drive conversion," the buyer said.

Facebook wants to take Stories beyond Instagram, but it's not going to be easy

Since Instagram rolled it Stories in 2016 (largely copying the format from Snapchat), the product has attracted 400 million daily users. Several brands have run successful campaigns in the format.

So naturally, Facebook sees an opportunity to replicate this success on its core app. But it's not going to be easy feat.

In comparison to Instagram Stories, Facebook Stories has just about 150 million daily active users as of May. And on the brand side, the ads currently being tested on Facebook Stories have no click-through or call-to-action, even though Facebook has plans to add that as well as additional metrics in the coming months.

"Facebook Stories is currently crickets," said Ryan Kovach, paid social specialist at Social Outlier. "It typically takes a while between when a format is rolled out to when it gains critical mass."

Plus, Stories aren't really as lucrative as ads on Facebook and Instagram's feeds, as the Wall Street Journal reported. Ads in Stories generate about $1 per daily user compared with $9 from ads in users' Instagram feeds and $27 for ads in the Facebook feed, according to Wells Fargo analysts.

Facebook is working around that by making it easier for both brands and users to post on Stories. Users, who are already habitually posting to Instagram Stories, can share the same clips on Facebook Stories with the click of a button.

Advertisers on the other hand, can either directly port their clips over from Instagram Stories or reformat them from their News Feed ads. And Facebook also has plans to add direct-response features as well as additional metrics to Facebook Stories in the coming months, according to a company rep.

All of this should contribute to Facebook Stories ultimately gaining momentum, buyers said.

"Facebook's core feed is eroding and users are veering toward the Stories format," said Jon Morganstern, vp of paid media at VaynerMedia. "As soon as they have succeeded in getting enough daily users and time spent, they will swiftly monetize it."

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