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How Online Video Is Disrupting TV Advertising

How Online Video Is Disrupting TV Advertising

September 7, 2013 by Jake Larsen

Look guys, I’ve told you before. YouTube is changing TV forever. In this next part of my interview with Austin Craig, we talk about how it is changing and what you should do to take advantage of this revolution.

For decades TV has followed very specific rules. Your favorite program is on once a week and starts either on the hour or the half hour like every other show on TV. It either runs for 22 or 45 minutes with 8 or 15 minutes of commercials. The commercials are all 30-60 seconds a piece and all of them have to comply with FCC regulations. I know in the last segment we talked about how important consistency is, but what if these TV rules don’t fit what you’re producing? What if you want a 5 minute ad? Or a 5 second ad? You just can’t do that on TV.

YouTube has completely broken down the barriers set by TV. You can try out whatever format you want. Like I always say, it’s the Wild West. The land is cheap and there’s lots of it out there, but it won’t be that way for long. When Google AdWords first came out about 10 years ago the cost per click of an ad was as cheap as around 10-15¢. Today if you are promoting an ad for Insurance you can pay up to around $80 PER CLICK!

YouTube Advertising

Google has recently come out with AdWords for video and it is at that same point that AdWords was at 10 years ago. It isn’t that uncommon to pay 10-15¢ per view on an in-stream ad with TrueView. And if you can get your audience to click through to your site or skip the ad in the first 30 seconds (or before the end of the ad, whichever comes first) it costs you nothing, nada, zip. You’re getting for free what a company would pay $4 million for in the Super Bowl.

How much of what you watch is on TV vs online? Viewers are going online more and more often for their videos. Eventually companies are going to reach a point where it actually becomes more profitable for them to spend their dollars on online video. When that happens the billions of dollars being spent on TV advertising every year are going to flood into the online space. Things will get competitive and CPV will skyrocket. So get some cheap real estate in the Wild West while you still can.

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Another benefit of online advertising that seems like a complete no brainer for me is the the amount of details you get in analytics. I know who is watching my video for how long, where they’re from, what device they’re watching it on, if they clicked my ad, etc. Then I can select my ad to only play for 18-24 year old women from Chicago if I wanted to. The best broadcast advertising can do is say “Ok there were this many TV’s on when your commercial ran. We think there might have been 2 or maybe 5 people watching. Or maybe not.” They can’t know anything for sure!

Mass broadcasting is like a megaphone in a crowd; you can give one big fat message to everybody. What web advertising allows you to do is have a specific message for each individual’ -Austin Craig

Here’s a nice infographic that shows a little bit about how even online video ads may still be a much smaller chunk than TV ads, online ads are catching up fast:TV vs Online video

Filed Under: Why Video, YouTube Advertising

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