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Neon Tommy - Annenberg digital news

Facebook's Kay Madati On Getting Hollywood To Buy Into Zuck's Plan

Paresh Dave |
February 4, 2013 | 12:16 a.m. PST

Executive Director

This article is part of an ongoing partnership between Neon Tommy and L.A. Currents.

A bungled IPO left Facebook's relationship with Wall Street strained. But Facebook’s courtship with the entertainment industry seemed to be on solid ground, until recently. Last fall, Facebook founder Mark Zuckerberg railed against SOPA, the now-defunct entertainment industry-backed legislation designed to strengthen copyright laws. Zuckerburg then doubled-down, altering Facebook’s news feed algorithm. The change required film and TV studios to make more ad buys on Facebook, and now executives aren't sure the ads are worth the money.

On the front lines of California’s current "War of the Roses" is Facebook's Hollywood liason Kay Madati, who sat down with Paresh Dave to discuss the evolving relationship with the entertainment industry.

Based out of Facebook's office in Playa Vista, Madati leads a team that helps entertainment companies promote shows and films on Facebook. He's also serving this spring as the Media, Economics and Entrepreneurship Executive-in-Residence at USC's Annenberg School for Communication and Journalism.

Compared to Twitter, do you think that it’s an issue that Facebook’s news feed is too slow to have live conversations around certain forms of entertainment, such as award shows?

Madati: The reality is, amongst your friends, it’s already happening. It’s just the entire world can’t see that conversation. You and your 230 friends are probably updating, real-time in and around the show, posting moments, even going to the Golden Globes page and posting a picture. If you have no access to see that, you don’t believe it’s happening on the platform.

What we need to do is surface private data in an aggregated form -- in a non-user identified form -- so outside, people get a sense of what’s going on.

You’ve referenced a Nielsen study about how people watch TV shows just because they saw posts about it on Facebook. Will Facebook continue to have that kind of influence?

We’re the largest watercooler in the world. People on a regular basis leverage the platform to do what they do in the offline spaces, to talk to the people they care about, to follow the people and brands that influence them. And I don’t think that kind of behavior goes away. I think that kind of behavior is accelerating, if you believe Zuck’s law, which kind of says people share twice as much information every year, year over year. I think you’re going to see more of this discovery of information through your friends.

How much work do you do promoting shows exclusive to Hulu or Netflix or YouTube?

The business model’s a little bit different. A television network is very interested in inviting eyeballs to actually watch on television. Netflix or Hulu+ is more interested in acquiring more subscribers, (and) not as concerned about appointment viewing or how much you watch.

I imagine the goals there are to surface the fact that I’m using this service on Facebook with my friends, so that they might actually go and subscribe. It’s actually a heavier lift than saying, ‘This is on tonight, go and turn on your television.’ This one requires you to put in your credit card information. I wasn’t a Netflix user until 200 of my friends kept posting about Downton Abbey, and Netflix was the only that had season one and season two, so I joined. In the last 30 days, it’s changed a lot of things in my house.

...Even though they're dealing with entertainment content, Netflix wouldn’t fall under my responsibility day-to-day. We’re much much more interested in helping traditional business models leverage new ways to drive engagement and awareness for their content and drive back to their core monetization platform.

How do sponsors and advertisers leverage the social media pages of programs they're associated with?

If you’re Pepsi and you’re a sponsor of X-Factor on Fox, which is one of the most social shows on television, you’re investing a lot of money. You are branded integrated into the show. And you’re buying advertising in the parts of the show. You’re probably buying sponsorship on Fox’s digital platform around it and now you’re saying you want to be part of the social conversation around the show. So can Facebook help Fox extend the social reach of the show to include brand advertisers and pull them into the conversation in a relevant way?

What if there was a 10-minute recap brought to you by Pepsi, that was shared and distributed via social -- Twitter, Facebook, whatever it maybe -- that Pepsi could incrementally own as part of an investment around the content. We’re interested in those kinds of conversations.

Have you seen sponsorship and marketing deals that tie money to social engagement?

Can’t talk about the deals, but I will say most advertisers are going to be uniquely interested in being as close to the buzz and the social footprint around some of the most social content in the world. If I’m a marketer, I’m interested in associating myself around engaging entertainment content.

When working with shows and films, do you plan a coordinated social media strategy to sync up Facebook and Twitter presences?

We’ve been in rooms where we’ve both been around the table and included in in the ideation. We’re not suggesting Facebook is the only thing that anyone should do. I don’t think that’s the answer. But we do think Facebook should be part of everything you do....There’s room at the table for all of us, but structured in some strategic way that mirrors against the objective.

Can you develop a social media strategy that doesn’t include buying ads on Facebook?

Lots of people do that, lots of times. In some cases, you can be super successful. Our core proposition is not just about generating revenue from our partners, but it is when you get to a certain scale. With a billion people on the platform, where the average U.S. user has 230 friends, likes 80 pieces of content, that automatically means the velocity of the news feed is moving pretty quickly.

To break through in that, to actually get to the point where I stop whatever I’m doing, and I decide to care about (a post) and distribute it because I’m passionate about it can absolutely happen and does on a regular basis.... But a user is only going to see about 16 percent of content that’s served up to them, on average.

So if you have a million fans and want to keep all of them engaged, the best practice is a paid plus free strategy because it allows you to leverage our media ecosystem and move that 16 percent to 70, 75, 80, 90 percent. Especially at important moments, like tune it tonight or go buy it today. If you’re starting at ground zero, to scale to one million fans it’s not going to happen without paid media...unless you get lucky.

How do you think about mobile? Are we going to get to the point of varied content depending on consumption device -- desktop or mobile or tablet?

I think it should absolutely get to that point. It’s going to have to. There’s different user expectations between devices and platforms....I don’t do a lot of heavy things on this (points to iPhone). So why would a content publisher expect to publish to multiple destinations with the exact same thing and expect me to react the same way?

...Organic and paid posts are seeing much much more engagement on mobile because people are spending more of their time there.

What if I was at dinner on a Friday night and I check-in with four friends. Because I check-in, Paramount now knows that I am three blocks away from the closest movie theatre, and they all of a sudden surface up a movie.

There’s a future in this that when you tie geo-location to interest graph information to me checking-in to a location, that can serve up an entire relevant universe of things around me to do that might interest me. That’s got to be pretty compelling for movies, where 92 percent of people make the decision at the movie theater of what they want to watch. That’s an opportunity to think of mobile activation through interest graph data.

So you’re trying this stuff out?

We probably need to scale out check-ins. There ought to be more incentive. Search graph might create that reason. Search graph is only as good as me being able to check-in, so you know where I am, me being able to pull into an experience, that’s the fact that I’m near a movie theater, and being able to serve that up against a movie company that might want to say, ‘I want to find people who are eating in restaurants around movie theaters that might want to go watch my film.’

There’s a lot of data pieces that need to come together to make that happen. Nobody might’ve pulled it together quite yet, but the pieces are there to be ready to do it.

What’s going to be your biggest challenge this year?

This is a vastly changing, fast-moving space. What’s hard for us as well our partners in this space is keeping up pace with how technology is evolving, how consumer reaction to that technology is changing and how they incorporate that technology into their lives is changing.

...The reality is nobody is going to get 100 percent of it right, including us. But you have to have the fortitude and the curiosity to actually want to experiment and try different things in order to drive your strategy. I see that as an opportunity, and a lot of our partners do too.

As far as Instagram, Madati said plenty of brands are still yearning for custom filters.

Like reporter Paresh Dave on Facebook, follow him on Twitter, circle him on Google+ or send him an e-mail.



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