Last year popular content creating network and online TV for youth, The Viral Fever had launched a five episode drama series Permanent Roomates in association with CommonFloor. Almost every episode fetched a million views on YouTube and accolades to TVF for the fresh concept. CommonFloor gained from the content and the in-video promotions TVF did on its YouTube channel which is now subscribed by a million subscribers.
While all that was fine with both parties being happy but such an alliance won’t be possible in the future, as YouTube isn’t happy. Mid last month Digiday broke a vital story that got the content creators on YouTube really worried – ” YouTube is clamping down on video creators who work directly with brands, nudging them instead to rely on Google’s sales team for deals.”
YouTube has quietly amended its ad policies to block “graphical title cards” from sponsors aiming to promote their brands and products on YouTube channels, according to a revised FAQ document in YouTube’s help and support section. Video overlays of sponsor logos and product branding are no longer allowed — unless the sponsor pays Google to advertise on that channel. “In other words, YouTube is making it mandatory for content creators to include Google ad sales teams in each and every deal and buy media through them,” said a content creator to ET asking not to be named.
A YouTube representative called this revision a clarification of its existing policy, one that occurred late last year, intended to prevent advertiser conflicts and ensure viewers don’t feel bombarded by ads. YouTube, however, allows content creators to earn revenues from sponsorship like simple product placements, text banner ads embedded in the content and content solely created around a brand. “For such content, creators can make 100% revenues and we won’t charge anything,” said Google spokesperson to ET. “But for 30-second to one minute ad or full-fledged graphic banner ads embedded in their content they will have to share a percentage of revenue with YouTube.”
Broadly the guidelines state that you as a content creator can’t cheat the Google pre-roll anymore, informed Samir Bangara, Co-Founder & Managing Director at Qyuki Digital Media, while discussing the nuances of the latest policy change. “The crux of this changed policy is that you can’t have pre-rolls or post-rolls into your content. But product placement integrated into the content is still fair game. You cannot do blatant logo placement but if you do content marketing in a more tasteful fashion then there has been no change.”
The reason why YouTube has woken up suddenly according to the company is allowing such ads could create channel conflict. “For instance, we serve a Honda ad before the content starts playing, and they’re plugging ‘brought to you by Toyota’. It is a bad experience for the users seeing two ads back to back.”
However, YouTube later stated that it has decided not to actively look for offenders for the time being, according to a source close to the company. “YouTube is not policing this policy yet unless they receive a complaint about the video, [though] that may change,” said the source to DigiDay. “But basically, using a brand logo as part of a paid placement or paid integration is a no-no unless the brand buys 100 percent share of voice on the video.”
YouTube may justify that the sudden change of policies has been done keeping in mind user experience and prevent advertiser conflicts but it also indicates that it isn’t willing to let go money to product integration and sponsorship within video. It wants to join the party and make more money from its own platform. A step that was followed earlier by Facebook when it decreased its organic reach thereby forcing brands to pay more for ads. “I think it is a fair ask from YouTube; pre-rolls and post-rolls become more targeted by not having your competitor ads on your content. It also puts a big onus on the bigger content players to take content marketing more seriously,” he added.
YouTube takes 55 percent of the revenue when Google ads run on the content produced by an MCN or a content creator. With this new policy it definitely hits the bigger content producers or MCNs. While some may call it a diktat, content producers have no choice at the moment as they have built their entire revenue model on a platform that isn’t owned by them. “As content creators, we are looking at YouTube merely as a content delivery platform. Just like how a television channel will try their best to reach their audience across all competing DTH services, we will continue to use all platforms to reach our audience. Smart content creators are always going to figure out a way to create and distribute content in their own ways,” said Arunabh Kumar, Founder and Creative Experiment Officer, The Viral Fever Media Labs to Best Media Info.
Will this action force large content producers to look beyond YouTube? If it is true then what choices do we have – Vimeo, struggles before the reach of YouTube and Facebook is yet to grow at the same speed like YouTube is. Besides we are also aware how we need to invest money on Facebook for community building as well as to have our content reach to the same community.
As of now YouTube isn’t willing to let go money to product integration and sponsorship within video. However, it would be interesting to see if YouTube’s competitors (Facebook, Vine, Vessel, Snapchat) are successful enough to lure content creators in the coming future.