Investors needed one day to get caught up in the potential vicissitudes of Facebook’s newly released reels products for Instagram.
The day after the launch of the new short-video product, they shipped Facebook stock (ticker: FB), up 6.5% on Thursday to $ 265.28. It has the 11th largest percentage in the last five years. The S&P 500 index ended the day up 0.6% and the Tech-Heavy Nasdaq Composite Index gained 1%.
According to Stifel analyst John Egbert, short-form videos made by them form the backbone of Tickcock’s attraction, and many producers are enjoying early success.
“Most of the top Tektok creators already had Instagram accounts but were not necessarily posting the same type of content – now many of them are porting content and seeing strong engagement with their posts,” Egbert told Baron’s In an email, “Instagram carved out some prime profile real estate for these TikTok-style videos, and it’s been doing great so far. But it is day 2. ”
Egbert reported that Zach King, the third-most followed producer on Tickcock with 46.8 million users, posted his most recent TickTalk video to Reels on Wednesday. (He has 23.5 million followers on Instagram.) As of late Wednesday night, Reels Post had garnered around 7.2 million views, while Ticktock had 4.5 million views, and his significantly smaller Instagram audience made more likes and comments than expected. Tiktok version.
“Granted, this is a single data point, but I think it’s this type of response that could win over more tick creators,” Egbert wrote.
The popular short-form video by Tick-Talk, which is owned by Beijing-based BuyDance, has garnered the company millions of users worldwide. One reason that people are turning to Internet-connected apps to socialize is because the Kovid-19 epidemic has ordered governments around the world to shelter-in-order.
Tiktok is also threatened beyond Facebook. The Trump administration has indicated that it plans to block the company from the US because of concerns about near-term byadens, possibly handing over US data to the Chinese government. In response, TikTok has negotiated with Microsoft to sell the American portion of its business to the venerable tech company. In a rare move, Microsoft acknowledged that the acquisition was under discussion and said it would fully complete them by 15 September.
For Reels to succeed, Egbert says, it will be important for them to catch the long-tail of the so-called creators, a huge group of people who like the audience, which will add width to the user base .
“The biggest challenge for Instagram will be whether it can attract the creators of long-tailed content because it’s a lot of the magic of Ticktock – anyone can create something that goes viral,” Egbert said. Wrote “In this area, it may take a while for TicketTalk to capture Instagram’s algorithms (identifying potential viral content from creators with little following), but Instagram has some very powerful personalization algorithms.”
It can also be seen whether Instagram can offer enough upside for creators to post on both platforms.
Write Max A. Cherney at [email protected]