YouTube’s updated ad policy gives it the power to place ads on any content of its choice, and not just the more popular channels covered by YouTube’s partner program (YPP). The platform will also not share the revenue it makes from such ads with content creators.
Digital marketing experts said YouTube’s revised terms of services will affect advertisers, content creators, as well as viewers. Advertisers, for instance, will have the flexibility to choose creators on whose content they would like to place an ad.
“Advertisers can, therefore, micro-target audiences through particular creators. For instance, if an advertiser wants to publish ads on humorous content, they can do so even if the creators are not a part of YPP. With a wider selection of YouTube channels, advertisers can further refine their marketing strategies,” said Kunal Kishore Sinha, co-founder, and chief operating officer at influencer marketing platform ClanConnect.
However, brands will have to be cautious while running ads on smaller channels. To be sure, YouTube places ads on video content based on viewer demographic (such as internet brands targeting young consumers), viewer interests/affinity (such as food brands targeting cooking enthusiasts), and channel-based ads (brands targeting audiences of particular YouTube channel).
“Majority of campaigns are run on affinity-based advertising, and now that YouTube has opened ads on all kinds of channels, an ad can go anywhere. Brands will be at risk if their ads are run on small channels, which are running content that can be sensitive, irrelevant, or low-quality. Having said that, since more ad inventory will be available on YouTube, advertising can become cheaper,” said Shradha Agarwal, strategy head and chief operating officer, Grapes Digital, a digital-first agency.
However, small creators are concerned because the revenue generated from the ads placed on their videos will not be shared with them. Moreover, placing ads on their channel may impact their growth as advertising can act as an irritant for viewers who have not yet become loyal followers of that channel.
“Many content creators, including artistes and influencers, choose not to put ads on their content so that their fans and followers can view their content disruption-free. However, now they won’t have a choice,” said Ambika Sharma, founder and managing director of digital marketing agency Pulp Strategy.
Even for bigger, more popular creators, who are part of the YPP program (which only includes creators who have 4,000 total hours of watch time over the past one year and more than 1,000 subscribers), there could be a drop in revenue as YouTube might prefer to exhaust ad inventories on non-partner channel videos and save on commission.