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Mangesh Chaudhari
MKT5600: YouTube for Brands
create content for their product. With this case shows examples of different brands such as Red
Bull, CoverGirl, L’Oreal and Lego’s strategy of using YouTube.
2) What options are available for brand advertisers to use YouTube to engage with
consumers? What are the pros and cons of each option?
YouTube originally began by organizing their content in channels or streams of programming
that were bundled according to personal preferences, genre or brands. In 2014, there were three
types of channels available for brands such as standard user channels, brand channels and custom
brand channels.
Standard User Channels: By registering on the website everyone (individual or company) was
given a standard YouTube user channel. This type of channel was free of charge. In this type of
account, users were able to upload videos, make playlists of favorite videos, mark them in a
watch later list, share them on social media sites and subscribe to YouTube channels.
Pros:
- Free channel
- No strings attached
- Store any type of video content (as far as it was within guidelines)
Cons:
- Not many features
- Everyone can get this one.
Brand Channel: This type of channel was free and similar to standard user channels but offered
only to brands for the purpose of corporate branding. These could be used by brands to house
media such as how-to videos, tutorials, commercials, behind-the-scenes videos and other relevant
content for their customers. Statistics showed that only 7.5% of YouTube videos hosted by
world’s top-500 brands were repurposed TV commercials.
Pros:
- Exclusive for corporate branding
- Free account
- Unique to store brand content
Cons:
- Similar to standard user account.
- No unique features compared to standard account
- Minimal to no customization
Custom Brand Channels: Custom brand channels compared to previous two types is not a free
channel. Based on different websites, it was reported that it cost a minimum of $200,000 per year
to maintain this channel. With a purchase of this type of channel, companies gained access to
Mangesh Chaudhari
MKT5600: YouTube for Brands
customized features such as unique channel layout and add-on features such as gadgets-
interactive web apps that created a distinctive experience for their subscribers. Uploading live
streaming of video content or extensive user generated content was required to have a custom
channel. Due to high price point, most brands opted not to choose this option.
Pros:
- Exclusive feel
- Opportunities to add/remove add-ons as required.
- Opportunities to customize.
- Allowed to created unique experience to subscribers compared to standard and brand
channel
- Allowed live stream activities
Cons:
- Very high price point
Exhibit 1 below also shows comparison between the three account types available.
There was a fourth type of channel introduced as the “original channels”. Through this
approximately $150 million in funding was advanced to well-known celebrities ranging from
rapper Jay-Z and comedian Any Poehler. By 2013, YouTube still had original-content channels
but stopped financially supporting and referring to them in that manner.
Mangesh Chaudhari
MKT5600: YouTube for Brands
3) As a brand marketer, what recent YouTube initiatives are you excited about? Are there
any you do not like? Make sure to elaborate on why.
There are primarily three types of advertising formats on YouTube.
i. Non-video formats:
Non-video advertising format consisted of display ads, also known as banner ads, which
appeared to the right of the selected video or directly above it. These ads were bought using
Google AdWords, a keyword based auction platform. This works similar to Google's paid
search results. These are also transparent overlay ads, which were text ads that appeared at
the bottom of the video.
There is high traffic of people accessing YouTube. As per case, about 20% of all internet
traffic in North America, Europe and Latin America is observed. There is not much pricing
information provided in the case study. Assuming these are the cheapest form of
advertisement google offers, it is a very good platform for smaller firms or startups to
advertise or it could be for companies who do not wish to invest big dollars in advertising
their product. With the amount of traffic seen and keywords unique to their product will
provide easy advertisement along with the video content being viewed by the user.
ii. Video Format – Non-skippable Ads:
As mentioned earlier this is similar to TV commercial format. These ads were available
before, during and/or after the video content was played. Purchasing this type of ad was also
similar to TV commercial format i.e. CPM basis.
When comparing this format to TV commercial, there was one major advantage. These
commercials were interactive. At any point in the commercial, if the user clicks on it, it will
go to the product or service video or to its webpage. Conversion rate for inquiry for this was
very high. During a TV commercial a user would see it and think that he or she will reach out
after a certain activity. After this said activity, there is also a possibility that the user will not
follow through or just move to a different product/service based on their other interactions.
With a clickable ad, depending on the user’s interest, he or she may follow through and either
research more information or even purchase the product or service being advertised.
iii. Video Format – Skippable Ads:
Skippable ads were also known as TrueView ads. This type of advertisement always played
at the beginning of the video. After five seconds of play time, a button would appear that
allowed the user to skip the ad and proceed towards the content he or she intended to watch.
TrueView ads could be placed in-search, appearing as a result of YouTube search, in display,
appearing a suggested video next to a selected video or in-stream, appearing before, during or
after a video was watch.
This will be a cheaper form of the video ad as it will not charge the advertiser until at least 30
seconds or entire ad whichever is shorter is played by the user. Also there was no maximum
Mangesh Chaudhari
MKT5600: YouTube for Brands
length for this type of video. As per Google's statistics, somewhere between 15% and 45%
YouTube viewers let the entire ad play.
Based on the pricing strategy, this is could be a go-to advertising format that most of the
brands may experiment with.
Mangesh Chaudhari