TV is dead. Or more accurately, it’s dying and not coming back.
According to Nielsen, over the last five years, traditional TV watching has declined 44% for viewers 18-24 years old and 32% for viewers 25-34 years old. Online video streaming paints a very different picture. In 2017, 59% of American households had a streaming video subscription, compared to just 38% in 2014. We haven’t seen this kind of shift since TV began eclipsing radio in the 1950s.
So we know that television is way down and video is way up. Unsurprisingly, the lion’s share of this growth has gone to YouTube. The online video giant gets more than 30 million visitors daily. That means almost 5 billion videos are watched on YouTube every single day.
Seeing where YouTube is today, it’s easy to overlook its humble origins. When three ex-PayPal employees launched YouTube in 2005, its “office” was located above a Japanese restaurant in San Mateo, California. But it didn’t stay that way for long. Just a year later, around mid 2006, the site was receiving millions of video views per day. By November of that same year, Google had made an offer to buy the company for $1.65 billion. Today, YouTube appears poised to overtake cable TV in its entirety.
But the implications aren’t just for home viewers. This shift has also sent major ripples through the advertising industry. And that’s a good thing.
Behold, the many benefits of YouTube advertising
YouTube provides a strong alternative to TV advertising, and it offers a number of distinct advantages over the older platform. With traditional ad buys, the process often goes like this: send RFPs to assorted stations, wait days for a response, and finally begin the tedious process of negotiating times and prices. With YouTube, the time spent on a buy is reduced substantially, even if you’re using an agency.
YouTube uses a far less manual form of negotiating pricing and views. Digiday describes it like this: “Programmatic ad buying typically refers to the use of software to purchase digital advertising, as opposed to the traditional process that involves RFPs, human negotiations and manual insertion orders.” YouTube’s programmatic system allows you to access available ad inventory in real time, and use highly qualified on-demand data to quickly make decisions that would take days or even weeks under television norms.
With YouTube, prices are determined using a bidding system. Advertisers compete to show their ad on videos based on the price they’re willing to spend per view. Bidding rules are set in advance along with a budget, and the system takes care of the auction process based on those pre-determined rules. If I wanted to show my ads to people in Coeur d’Alene at $0.08 per view, between 4 and 5 p.m., I can plug in that info, and YouTube handles the rest. Each time a video displays in my area, YouTube looks at everyone’s bidding rules, finds the top bidder and plays their ad.
Another key advantage of YouTube is that it lets you quickly act on insights gathered from incoming data. The Google-YouTube system allows our team at JEBCommerce to see who’s engaging with the ads—and implement changes to help the campaign better hit its target. Are men engaging with the ads more than women? No problem, let’s adjust it to show the ads more to men. Are the ads performing better with people in Seattle than people in Portland? Cool! Let’s have the ads display more in Seattle. These kinds of insights and actions add amazing dexterity to video ad campaigns when compared to traditional TV media buys.
A few thoughts on YouTube advertising strategies
YouTube offers many options that simply aren’t available in traditional TV advertising. Here are some of the main ways we organize YouTube advertising for our clients.
Keyword and Topic Based
Video ads can show on videos that contain specific words in their title or description. The ads also can be triggered based on specific content topics. For example, if we target the “politics” topic, your ad will show to people watching YouTube videos about politics.
A Prospecting strategy maximizes the number of YouTube videos that will display your ads. There are few restrictions, if any, as to where your video ads will appear.
Video ad retargeting works the same way as prospecting. However, your video ads will only appear in videos viewed by people who have visited your website before.
Google Analytics Based
Video ads can be used to retarget anyone who has visited your site, or subgroups like “visitors who stayed on the site for X minutes but did not make a purchase” or the elusive “cart abandoners.”
Video ads can target people based on their Google-compiled interests. A garden tool company, for instance, can opt to show video ads only to people whose online habits have indicated an interest in gardening and homemaking.
Any way you slice it, YouTube video advertising is a winning alternative to television advertising. If you’re considering a media buy in the near future for your own company or on behalf of your clients, drop us a line to learn more about YouTube’s distinct advantages.