A Decade With Google: How YouTube Has Evolved From A User & Advertising Perspective
This year will mark the 10th anniversary of Google’s acquisition of YouTube for $1.65 billion in 2006. Consequently, we thought it would be fitting to take a step-back and look at how YouTube has developed – both from a user and an advertising solutions perspective – to what we know and love today.
Admittedly, the first video ever uploaded on YouTube is far from all the viral videos that circulate the web today. So what was the turning point?
‘THE PARTNER PROGRAM’ AND YOUTUBE’S FIRST ADS
In May 2007, seven months after Google acquired YouTube, they launched the ‘Partner Program’. This allowed everyday users to get paid for their viral content. Thereafter, the interest and engagement with the YouTube platform snowballed into the viral UGC platform it is now, with videos such as ‘Charlie Bit My Finger’ generating hundreds of millions of views. This UGC Partner Program proved to be the catalyst that launched YouTube into one of the most powerful online video platforms available today.
Aided by the Partnership Program and several strategic partnerships, such as the presidential debate for the 2008 election cycle with CNN, Google were now in a position to monitise YouTube through advertising. The first advertisements on YouTube were semi-transparent display banners. They appeared across the lower 20% of videos and ran for around 10-15 seconds, unless the user clicked-to-close. The available targeting during this time consisted of basic genre, demographic, geography and day part.
Fast forward to 2010 and the In-Stream and In-Display TrueView ads, as we know them today, were launched. As with Google Search’s advertising model, ad views were billed on a Cost-Per-View basis – eliminating any investment wastage from media budgets. Whilst these ad formats have remained relatively unchanged over the last six years, audience targeting has undoubtedly become significantly more granular for advertisers and we are now able to reach specific audiences that would previously have been impossible.
Advertisers can now target users from both an audience (i.e. what people are interested in) and contextual (i.e. what users are watching) way. The increasingly growing array of Interest based targeting models, Audience Remarketing Pools and Customer Match (CRM audience targeting) has vastly improved efficiencies for advertiser’s YouTube campaigns. In addition to this, YouTube as a platform has evolved to conform to user and advertiser requirements – having launched YouTube Gaming last year and, recently, YouTube for Kids in 2016.
CONTINUING TO EVOLVE
Although the vast majority of YouTube content is free for the user, Google have been testing new monetisation models for the platform. From Paid Content to YouTube Red, we can see Google positioning the platform to compete with other online video-streaming websites, such as Netflix and Amazon Prime. Although this is unlikely to drastically impact advertisers, it is interesting to observe how Google have developed YouTube to accommodate current trends.
It would be ignorant to believe that YouTube has reached its peak. In 10 short years we have witnessed its growth from a one-dimensional online video sharing platform, which delivered the occasional display banner, to market-leading advertising solution with innovative TrueView and Display ad formats. Having grasped YouTube’s growth over the last decade, one would only assume that as technology advances and online behaviour evolves that YouTube would, in-turn, do the same.