Now, streaming ads

If you thought “You can skip this ad in...” and “The video will play after...,” are bad, wait for the worst. YouTube is set to increase the frequency of advertisements in its snappy videos, betting that viewers, hooked to free content, won't mind. 

More advertisements, YouTube feels, will make the platform more attractive for advertisers looking to expand their reach.

And companies are too playing ball. 

By targeting YouTube users, they are cutting their advertisement and marketing budgets zeroing on their target audience.

“India is now both our biggest audience and one of our fastest growing audiences in the world. YouTube today has become the first stop for users to consume content, whether they are looking for entertainment or information. It is this incredible variety of content combined with the growing reach that makes YouTube a perfect platform for brands to drive personalised engagement,” said Susan Wojcicki, CEO, YouTube, during its India Brandcast 2019 earlier this week.

There are over 1,200 channels on YouTube in India with over a million subscribers. Five years ago, there were only 15 such channels.

“The future is even more robust. Keeping this in mind, brands will look at YouTube as a compulsory digital stop for the consumer. That makes it a great medium to use to tout brands,” said brand expert Harish Bijoor, adding that, “YouTube is the complete content medium. It has both width and depth to its credit it is not as fleeting as Instagram or as crisp as Twitter. It wins here.”

The popularity of YouTube among advertisers remains strong despite brands repeatedly pulling away from the platform due to “problematic” content. For example, in March 2017, Walmart and PepsiCo paused their spending after their commercials were found playing next to anti-Semitic videos. Similarly, Walt Disney, Nestle and others stopped engaging on the platform after a blogger showed how YouTube can be used to forge networks of people engaged in child exploitation.

However, the temptation is too much to resist for the brands. Also, YouTube has been quick to respond and Google parent has made major changes to it in the past in response to advertiser concerns.

“Brands that say they're cutting YouTube ads often find work-around to stay on the platform, such as striking deals directly with influential YouTube creators to include endorsements inside videos themselves,” an ad agency executive had told Bloomberg.

If you are still wondering about the kind of reach the brands can get in a short span through the platform, the streaming giant's YouTube Music surpassed three million users in the first week of India launch.

And to increase its ever-rising stream of revenues, YouTube is now looking at more original content. In 2018, it launched a musical reality show called Arrived. This year, it is working to come up with more originals for the Indian audience, giving competition to the likes of Amazon Prime and Netflix.

The only difference with YouTube will be that these originals “will be advertising supported”, Wojcicki told the participants at Brandcast 2019.

It is the personal approach that YouTube provides makes it an important partner for brands. This is why Pepsi turned to YouTube to extend the impact of the TV campaign and customise creative for specific audiences. With this approach, Pepsi saw three times returns on their ad spend.

Likewise, ICICI Prudential Life Insurance saw a 71% increase in the lead and a 33% decrease in cost per lead.

In order to drive its business further, two-wheeler maker Bajaj Auto, too, has gone the YouTube route. Rakesh Sharma, executive director, Bajaj Auto, said, “With the rich understanding of audience that YouTube provides, we were able to reach the audience effectively, thus releasing a lot of marketing time to do more.”

So be ready to see more commercials on your handheld screens because Wokcicki sees “an incredible potential in the next five years and there on.” Every year, there are 40 million new users coming online. By 2020, it is expected that there will be 500 million internet users in India who would be consuming online videos.

As a part of the bigger picture, Google has been wiring railway stations to provide free WiFi and reach out to untapped internet users in the country. This will only help in pushing up consumption of online content, including that available on YouTube. There are many more such avenues awaited with India further going 'Digital'.

NO PAUSE HERE

• 85% – Of YouTube videos in India are watched on mobile India
   
• 60% – Of the watch time is from areas other than big six Indian metros