STEPHEN BACH: YouTube is Suddenly on Fire for Some Media Brands. What Changed?

How Youtube became a powerful tool for media brands

This post was originally published on Medium.

In my decade-plus years in the online video business, I haven’t paid a considerable amount of attention to YouTube. To me, it was the traffic behemoth — responsible for huge view counts for content owners — but more a gigantic marketing platform than a meaningful revenue driver for most of the premium content owners I’ve worked with.

Official music videos, toy unboxings and clips of other people playing video games have long dominated the rankings, appealing to users but not capturing the imagination (or budgets) of the agency world.

Big media companies hated the business terms of working with YouTube. Remember NBC refusing to monetize its massive YouTube audience for years? For the content owners, figuring out how to sell effectively, even if they wanted to, proved difficult.

This dynamic seems to have changed recently, and quite dramatically.

image of youtube logo and dollars

Image: digitaltrends.com

Youtube Applied Stricter Criteria for Advertising

I was meeting with a large, diverse media company earlier this week to talk about video monetization. The question: “it’s Q4… where are all the video ads you’ve sold?”

YouTube is sucking them all up, they told me. For this one company, their YouTube audience has doubled year over year, and revenue has grown by an even higher multiple.

What changed?

In the last couple years, reports of bad ad juxtapositions plagued YouTube. Ads appeared on hate videos and other unsavory content. In response, YouTube applied stricter criteria when considering which videos are eligible for advertising.

Earlier this week, GroupM — “the world’s largest ad buyer” — said YouTube has largely cleaned up its act. A “2.5 out of 5,” said the agency’s managing partner of brand safety in the Americas.

Some progress there, but hardly a resounding endorsement. So why the incredible boon for the large, diverse media company I mentioned earlier?

Here’s a theory that was shared with me: agencies are still a little gun-shy when it comes to trusting that Google will place their ads on safe content, so they’re increasing their YouTube investment but buying specific channels from the media companies directly. This ensures agencies know exactly what content they’ll be advertising on.

Great news for the big, brand-safe, media guys, and YouTube still benefits as they share revenue with content owners selling the ads.

Good for Big Brands, Bad for Smaller Creators

Who suffers? I imagine it’s the smaller, independent creators. They’re already grumbling about the new monetization landscape on YouTube… and some are getting, er, creative when it comes to attracting advertisers .

The trend here suggests agencies will continue to flock to the safety of more premium brands, which means the creators will get less of a look from the big buyers.

Who could blame a creator for looking at the revenue opportunities on Facebook, Instagram, Snap, OTT, and everywhere else?

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