What Does the YouTube Ad Revenue Share Move Mean For Brands?
YouTube's recent announcement to share advertising revenue with short video creators could be good news for brands. Will it create healthy competition among content creators? Will this encourage creators to create quality content, and what brands will gain from engaging short videos?
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YouTube, the video-sharing platform owned by Google, recently announced that it would share advertising revenue with short video creators from 1 February. Content creators stand to earn a cut of revenue from the advertisements viewed in between the short video formats.
This recent announcement is in tandem with the search engine company’s earlier promise in September 2022 about considering more monetisation options. It is good news for brands as this will create healthy competition among content creators for quality content, and ultimately the brands will benefit from the wider product or service reach through this content. How should brands use this move to their benefit?
Are Video Platforms At War?
The recent announcement came through an update in YouTube’s Partner Program (YPP). Content creators with 4,000 valid public watch hours in the last 12 months for their non-short video content, or 10 million valid public shorts views over the previous 90 days, can sign up for this programme. For both types of content, creators should have a minimum of 1,000 subscribers.
YouTube and TikTok are strong competitors in the video-sharing space.YouTube has 2.6 billion active users as of 2023, whereas TikTok has 1 billion active users. This new announcement gives YouTube an edge as TikTok does not directly share advertising revenue with its content creators. On the other hand, YouTube has a history of sharing revenue with content creators through platforms like Super chats, shopping integration or facilities like Creator Fund.
This recent announcement has created a chance for short video creators to earn revenue through advertisements shown between the short videos. Last year, YouTube emulated TikTok by introducing a short video format in October 2021, while TikTok announced stretching its video upload limit up to three minutes, so it will be interesting to see how TikTok will react to this latest announcement.
Jacob Styler, Founder and Director of UK-based Infinity Digital, says, “Content that people can connect to is so important, and influencers do this well. If sharing revenue or a profit percentage is proven effective for influencers, then perhaps other platforms may follow suit.” Styler, however, adds that YouTube is part of the Google conglomerate and has the financial capacity to do this. In contrast, other platforms may not have the cash to do this effectively.
Incentivise Deeply Engaging Content
YouTube (Google) has a history of sharing revenues with content creators. With no such practice, the other platforms stand the threat of getting spammed with clickbait content because efforts to create high-quality content will not be rewarded. This may irk users who are likely to shift to platforms that guarantee them quality content.
“Unless content platforms fairly reward content creators, the quality of content is down because there is no economic incentive to create deeply engaging content,” says Maarten Ectors, Director at Profit Growing Innovator.
Elsie Bernaiche, Director of Sales at ThoughtLeaders, a company in the Influencer Market Place, supports YouTube’s decision to launch this programme to achieve long-term sustainability. “Creators will earn more for the valuable content they create – but brands will finally have the ability to pay amazing shorts creators for driving web traffic and sales to their brand, as they have long done on long-form video sponsorships on YouTube,” adds Bernaiche.
As an influencer marketing and branding expert, Bernaiche says since YouTube now allows non-Partner Programme creators to earn ad revenue from purchases, more brands will treat YouTube shorts on the same page as they treat Instagram or TikTok today as all brands strive to reach virality. Brands pick creators who best align with their intended audience and message.
“Brands have long seen the most predictable, stable performance for direct response campaigns via long-form content on YouTube. Still, with this new move, brands can essentially live within the YouTube ecosystem and touch on viral short-form content that was previously only accessible via Meta or TikTok platforms.”
Which Creators To Pick?
Sharing which creators stand a better chance to win integration opportunities with brands and how animation creators can make the most of this YouTube move, Bernaiche shares some advice.
“Influencers should recognise the type of content that’s gaining them traction and plan their monetisation around which brands can be the best fit for their content.” Influencers endorsing healthy lifestyle content will have more opportunities to enter into brand partnerships as many brands can fit into their content: clothing, supplements, meal kit services, skincare brands, and scented water brands, she adds.
On the other hand, creators of cute, thoughtful, animated content who can only produce weekly videos will find fewer opportunities to monetise through sponsorships, as many brands want a real face on-camera to lend authenticity to the product promo. Bernaiche advises this type of content creators should lean headfirst into short-form content. “Brands know their content is engaging, but it just doesn’t make sense to integrate their product – instead, they can pay for ads between shorts and take advantage of all the views they have drawn to your animations.”
Conclusion
The power-play between channels and creators has been ongoing, with the trophy shifting back and forth. For years together, creators have preferred platforms like Patreon (founded in 2013), Gumroad (founded in 2011) and Ko-fi (founded in 2012), offering one-click solutions to creators to fund their pages directly.
But as creators gain more traction, the ecosystem of companies facilitating them also grows. Content creator platforms help creators earn a monthly income by providing rewards and perks to their subscribers. In return, the platform charges a commission of 5 to 12 per cent of the creator’s monthly income, plus payment processing fees. Similarly, brands that directly engage with content creators can play their part in ensuring fair pay to influencers, as influencers knowing content worth may shift their loyalties to other brands giving them better monetisation opportunities. The bigger question is whether brands with skin in this competition are ready for this.
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