As Facebook makes a bold move into video, Facebook Australia and New Zealand chief Stephen Scheeler is keeping focused on being useful to business.
Stephen Scheeler has seen enough of the digital world to know that the next new thing is always about to vie for his audience’s attention. The managing director of Facebook and Instagram in Australia and New Zealand is – for want of a better expression – a jack of all trades, changing and adapting as circumstances dictate.
Scheeler, 51, was just 17 when he left his home state of New York to travel the world. He grabbed an opportunity for time in Japan as an exchange student and learnt the language over several years. “I’m from a small town in upstate New York,” he says. “I was one of those kids who got small-town fever. I was bored and I wanted to see the world.” Why not go straight to New York City? “It wasn’t far enough away.”
Then he came to Australia on a whim and stayed. “It was like America but had none of the problems.” Describing himself as half American and half Australian, he’s a kind of everyman. “I feel Australian when I’m in the US and American when I’m here,” he laughs.
"TV reaches a big audience, but a TV doesn't know who it's talking to."
In the 1990s and 2000s, his management consultancy work took him to companies as diverse as shopping centre giant Westfield, automotive services business Inchcape and drinks company Lion Nathan. That consulting experience, he says, still underlies his thinking. Indeed, his antipodean Facebook outpost is intent on helping businesses develop brands and run customer strategies.
Facebook itself is run the same way – Scheeler has developed a team not of digital magicians (although he has a fair share of those as well) but of more the all-rounder, old-world types – men and women who know how to deal and work with businesses large and small. It remains business-led, not technology-led.
Marketing’s personal touch
At the heart of Facebook Australia is business and brand positioning, and not just for the big end of town. Scheeler wants to educate and persuade businesses of all sizes that they can be as close to their followers as the local cafe that knows all its customers by sight. He calls it “personal marketing at scale”. It’s about allowing advertisers big and small to pinpoint their audience and drip-feed messages sequentially at their own pace.
Facebook builds such services in steps. “We build things for users and focus on what makes a great user experience,” says Scheeler. “We see how people use those products we build. First, there are the smaller beta tests, then bigger and bigger roll-outs. Then we start to iterate and make that experience better. That’s step one and step two.”
Step three, he says, is about building tools for business – and this includes tools for other media. “Instant Articles”, rolled out in February in conjunction with Buzzfeed and The Guardian, pipes other publishers’ news onto Facebook, where Scheeler says it can be loaded “more natively and instantly”. “It’s a much smoother experience than the user being offloaded to another site,” he adds.
Monetising is further down the list. “This happens way down the path after we have built for people and businesses and seen what they want,” says Scheeler. “Even then, we’re still modifying and working on that to improve it all.”
Traditional media has failed to pinpoint its customers, he says. “TV reaches a big audience, but a TV doesn’t know who it’s talking to. With Facebook, an advertiser like Toyota knows when a 45-year-old mother [a potential customer] is in the room, and when her 18-year-old son [not a customer] has left.”
Leadership essentials – leading innovation: learn practical techniques for cultivating and leading innovation.
It’s worth noting that Scheeler has some form here. Before he was promoted to run Facebook and Instagram in Australia and New Zealand last August, he headed its retail and automotive division.
“So,” he continues, “Toyota knows the mum is seeing its ads, so what does it do next? It could be the same ad or maybe it’ll show a few variations of models – then we show her a different ad with a different aspect. That’s what we call sequential messaging.”
His enthusiasm is palpable. “If every TV in the country could change as the audience changed,” he says, “wouldn’t it be the most powerful medium in your marketing arsenal and wouldn’t it change how and with whom you communicate?”
What does Toyota Australia think? No company wants to give away its digital marketing strategy, but Toyota’s statement sounds positive: “In our experience, campaigns delivered in this manner have resulted in significant increases in response/engagement. This is even more pronounced when messages are remarketed to those who have engaged with an initial piece of content.”
Mike Zeederberg, who runs digital strategy consultancy Zuni, says Facebook has moved from simply being a place where companies build brands to being actively engaged in moving product. The segmentation tools really do work, he adds. “If you as a business want to send a message to people you sent an email to last week, Facebook says ‘send us your email list and we’ll send an aligned message in their feed’.”
Delivered by handset
While Scheeler integrates Facebook deeper into advertisers’ businesses, he is also dealing with a huge change in consumer behaviour from PC-centred interactions to mobile-centred ones. His challenge is to marry the two together, moving businesses to advertising and promoting via mobile handsets.
Since 2011, the speed of consumers’ move to mobile appears to have taken everyone by surprise. Scheeler admits that even Facebook has found it challenging, yet it has been the making of today’s Facebook. The company’s global mobile ad revenue has reached US$4.2 billion a quarter, up 75 per cent year-on-year as of the first quarter of 2016. Mobile now accounts for 82 per cent of Facebook’s total global ad revenue.
With 7.2 billion smartphones in the world, there’s still room for growth in many countries. Australia, on the other hand, has evolved perhaps further than anywhere else: 14 million Australians use Facebook at least once a month, about 11 million come back to Facebook every day and all of those who come back every day do so on their mobile. “That’s 100 per cent penetration and it is happening nowhere else,” exclaims Scheeler.
If mobile is the medium, what will it enable? Facebook Live, the company’s newest big bet, is a very simple feature: hit a button to live-stream video. It first came to Australian attention in April, when Delta Goodrem released her new single exclusively on Facebook. It echoes earlier live formats from firms such as Periscope and Snapchat, but set in the Facebook context, it looks powerful.
With Live, Facebook has begun taking on television – and reaching into politics. In Australia’s 2016 federal election campaign, 530,000 people tuned into the debate televised on the ABC from the National Press Club. By the end of it, only 100,000 were hanging on. The third debate between prime minister Malcolm Turnbull and Labor leader Bill Shorten was held live on Facebook. Turnbull said at the announcement that he aimed “to have as big an audience as possible – and to reach everyone, you have got to use the devices which I noticed you are all holding in your hands. That’s the modern world. That’s the smartphone era.” However, while delivering on immediacy, the Facebook debate failed to garner more than 12,400 viewers.
Both Shorten and Greens leader Richard Di Natale have used the Facebook Live studios in Sydney during the election campaign. And Canadian prime minister Justin Trudeau, says Scheeler, is unafraid to point the phone at his face and press the “live video” button at every politically advantageous opportunity.
A Western WeChat?
It is difficult to discern exactly how Facebook will evolve, but many pundits point to China’s WeChat as a model. Both WeChat and Tencent’s QQ messaging platforms have tied bank cards to their accounts. That means more and more people are using the platforms to pay for taxis, takeaway food and movie tickets.
Scheeler has his doubts, arguing that different markets call for different ways of doing things. “Platforms like WeChat, the South Korean messaging apps Line and KakaoTalk – they’ve all grown up at a time when the mobile phone has been the only computing device in that particular Asian culture. Every country has its own way of developing their mobile phones,” he says.
The shape of the Facebook to come won’t simply be about smart tricks and new apps. While Scheeler is enthusiastic about innovations on the horizon, he also embraces older techniques – such as asking businesses exactly what they want.
Facebook by the numbers
Source: Facebook; figures as of June 2016
- 1.09 billion daily active users
- 989 million mobile daily active users
- 1.65 billion monthly active users
- 1.51 billion mobile monthly active users
- About 84 per cent of daily active users are outside the US and Canada
- There are more than 400 million active users of Facebook’s Instagram photo-sharing platform
- 900 million people use Facebook’s Messenger every month
- One billion people use the Facebook-owned WhatsApp every month
- Between Messenger and WhatsApp, people send around 60 billion messages via Facebook properties every day – almost three times as many messages as SMS handled at its peak
- There are three million active advertisers on Facebook and more than 200,000 on Instagram
Who is your favourite business thinker and why?
Stephen Scheeler admits that it “really does sound like a home run”, but of all the people that have influenced him, nobody surpasses Facebook founder, Mark Zuckerberg.
Zuckerberg’s combination of the long-term view and his ability to set a vision and drive towards it is what Scheeler admires most.
“He wants to make the world more open and connected and give people the power to share. He has oriented the business towards that vision."
Zuckerberg’s second great asset is the philosophy of team-building, which brought the platform to life.
“He’s good enough to know that other people know more than he does about certain aspects of the business. It’s why he recruited Sheryl Sandberg as COO – some CEOs think they can do everything, but Sheryl knew more about building a business than he did.”
Beyond Zuckerberg, Scheeler is an admirer of anyone who has changed and disrupted the status quo. This includes Steve Jobs and Tesla’s Elon Musk.
“What Musk is doing to disrupt the auto industries is phenomenal,” he says.
What makes Facebook tick?