When brands boycotted Facebook, Instagram and Twitter in June, YouTube slipped by mostly unaffected. And although parent company Google faced a grilling on Capitol Hill last week, no one doubts their continued success.
All things considered, YouTube is doing well.
And why wouldn’t they be? The second most popular website in the world, YouTube generated $15 billion in advertising revenue in 2019 alone. That’s equal to 20% of advertising spend across all U.S. television networks.
As YouTube gains popularity, the battle with broadcast TV for advertising dollars grows more intense. YouTube promises targeted ads and measurable results. TV reminds companies it’s the top brand-building channel. The problem for brands arises when the hype distorts the true costs of both TV and YouTube—with unfortunate results. Too often, brands automatically turn to YouTube to solve their advertising woes when TV may be the better option. Here’s why.
Say your brand decides to advertise on YouTube. Producing the creative can be expensive, but you’re excited to reach your ideal audience, which YouTube lets you find by targeting people most interested in your offering based on multiple data points. That’s important, because at a 10- to 20-dollar CPM, every impression counts.
Instead, suppose you test TV with our model. You still target by demographics based on selected networks and shows, but TV’s broad reach connects with both primary and secondary audiences. You’re reaching more people—and at a CPM 5 to 10x less than you’d pay for YouTube.
Which scenario has a better return on your investment? Think of it like this: You’re on the basketball court. Each shot made is a new customer. For the same cost, you can shoot 100 basketballs or LeBron can shoot one for you. Who’s going to make more baskets? The answer’s a layup.
TV campaign measurement and attribution makes some brands nervous. YouTube makes it easy to track the response to each ad, especially for digital-native brands. TV has the opposite reputation.
The surprising truth is TV’s not the clunky, unmeasurable marketing channel it’s made out to be. Each time an ad airs, the impact on web traffic, call center activity or texts is trackable. In addition, research shows TV raises activity across channels for weeks after an ad airs. YouTube’s long-term effects aren’t nearly as clear.
YouTube has a problem guarding brand safety. Over the years, major brands have dropped their YouTube advertising to avoid association with undesirable content. YouTube’s done what they can to regulate uploaded videos and allow advertisers to manage where their ads are featured. But the nature of the platform means perfect monitoring is impossible, and those ad restrictions only further limit your reach.
Some brands simply aren’t fits for YouTube. Brands with audiences older than 35 will find better results connecting with this demographic on linear TV. Companies with complex products can’t clearly explain their business in 30 seconds—the maximum length for an unskippable ad (which also costs an additional fee). Of course, some brands suit YouTube well. Those with younger audiences or niche offerings might find YouTube is exactly what they need to succeed. Plus, YouTube doesn’t require a minimum, so you get out exactly what you’re willing to put in.
That’s the problem, though. With TV, many advertisers can get back much more than what they put in, if the media is purchased intelligently. TV is where brands have the time and reach to drive growth. And if more brands truly gave TV a chance, YouTube might find they have a bigger fight ahead than they think.
Read how over-targeting can limit growth in an article from Chief Client Officer Angela Voss.