YouTube Is Right To Be Worried Over Yahoo’s Video Ambitions
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- June 2nd, 2014
We all know what the British miners were supposed to do back in the late 1890s when the canaries they’d brought with them into the coal mines stop chirping. Escape immediately or put on protective respirators. But what should YouTube do if a couple of people who don’t want to reveal their identities tell Tim Peterson of Advertising Age that “Yahoo is ramping up talks with video producers and plans to premiere a rival to Google’s video service later this summer”?
Yahoo’s More Generous Partnership Revenue-sharing Deal
First, YouTube should pay close attention to the chirping. YouTube Partners have long-chafed over the standard revenue split, where Google takes 45% of ad revenue, so chirping is normal background noise. If the video creator community suddenly gets quiet later this summer, then an awful lot of YouTube partners have probably signed non-disclosure agreements with Yahoo along with contracts that promise them more generous revenue-sharing deals, or fixed ad rates that are significantly higher than YouTube is currently delivering to partners. So, if the canaries stop chirping, that’s when YouTube needs to worry. In the meantime, it wouldn’t hurt YouTube to leak the rumor that the Google Preferred program for advertisers could be expanded to a total of 14 categories. Then, YouTube might be able keep more than its top 5 percent of YouTube partners happy.
YouTube Needs to Stay Focused
Second, YouTube needs to spend less time comparing itself to cable networks and more time comparing itself to other video content properties. If the only thing that top brands and their agencies look at is reach, then Google Sites, driven primarily by video viewing at YouTube.com, reaches 155.6 million unique viewers in the U.S., according to comScore Video Metrix (March 2014). This is 2.8 times more than Yahoo Sites, which reach 55.7 million viewers. However, if you look at video content views, then Google Sites had 11.1 billion that month, 19.1 times more than Yahoo Sites, which had 579.4 million. So, if you worked in YouTube marketing or Google’s PR department, which key message would you want top brands and their agencies to remember: YouTube reaches 2.8 times unique viewers than Yahoo, or YouTube gets 19.1 times more video views than Yahoo?
YouTube Need Its Own Sales Force – Now!
Third, Google will regret that it ignored my memo to Susan Wojcicki back in February and didn’t give YouTube its own sales force. Right now, Google’s brand advertising group is focused on getting top brands and their agencies to move some of the massive amounts of money they spend on TV ads into Google’s display ad network, its social network Google Plus, as well as YouTube. As Otter says in Animal House, “Now, we could fight ‘em with conventional weapons. That could take years and cost millions of lives. Oh no. No, in this case, I think we have to go all out.” But, in the coming battle with Yahoo, that’s not an option for YouTube. It would be helpful if Google’s ad sales force was structured, trained, and incentivized differently. But YouTube is going into hand-to-hand combat with too many sales reps who still think video ads are just another display ad format.
YouTube’s Smart Move in Acquiring Twitch
Fourth, YouTube should acquire Twitch. Yes, I realize that this is in the works. Todd Spangler of Variety broke the story, “YouTube to Acquire Videogame-Streaming Service Twitch for $1 Billion: Sources,” on May 18, 2014. He wrote, “Google’s YouTube has reached a preliminary deal to buy Twitch, a popular videogame-streaming company, for more than $1 billion, according to sources familiar with the pact. The deal, in an all-cash offer, is expected to be announced imminently, sources said.” That was two weeks ago. What’s holding things up? Spangler’s story also included this news nugget: “YouTube is preparing for U.S. regulators to challenge the Twitch deal, according to sources.” Well, tell the lawyers they’ve taken long enough to prepare. You’ve got a business to run and you’re going to announce the deal before the E3 trade show, which takes place June 10-12.
YouTube Should Take Its Own Advice
Fifth, Google and YouTube should take their own advice. Back in October 2013, YouTube Insights told brands that 63 percent of campaigns would benefit from shifting 18 percent of their TV budget to YouTube. So, what does Google, the world’s most valuable brand, do? In April 2014, Google launched a campaign to promote three YouTube creators: Michelle Phan, Bethany Mota and Rosanna Pansino. The campaign, which ran through mid-May, included TV ads, magazine ads, billboards, plus signs in subways and trains as well as YouTube homepage ads, Google search ads, and display banners across the company’s ad network. Do you think Google would have benefited from shifting 18 percent of its TV budget to YouTube? Do you think a copy of YouTube Insights should be sent to Co:Collective, the New York agency that developed Google’s campaign?
Hey, nothing personal. I’m just doing my job. ReelSEO’s videologists and columnists are supposed to offer expert advice, guidance, and commentary about the world of online video. Our goal is to guide internet marketers – including the ones at Google and YouTube – towards best practices and online video services that suit their needs. So, like a canary in a coal mine, my role is to detect risks and provide advance warning of danger. And believe it or not, I agree with the statement in the YouTube Creator Playbook for Brands: “Online video presents opportunities that television simply doesn’t. YouTube is patronized by a hyper-engaged, highly-connected younger audience who craves the two-way communication YouTube offers. And unlike TV, YouTube lives everywhere because it’s accessible on hundreds of millions of mobile devices globally.”