Top companies keen to use YouTube’s new ad opportunities

Google’s video platform YouTube makes big efforts to create its own entertainment program and become a real alternative to traditional TV. Funded with about 100 millions US dollars, YouTube’s project will include entertainment on about 20 channels. Channels will cover all relevant interests, such as sports, music and arts. Some shows are supposed to be hosted by celebrities like skater legend Tony Hawk or pop singer Shakira. YouTube will also buy professionally made content.

So YouTube’s ambitions are serious. And they are confident that the concept will work out and attract top companies. An exclusive one-year sponsorship in a package of music and pop culture channels will cost you 62 millions dollars. This hasn’t been paid yet. However,  top companies like Unilever and GM paid sums from five to ten millions US dollars to get their special advertising access to YouTube’s original content.

Putting money for advertising on YouTube’s channels also means that companies will have to slightly reduce their TV ad spendings. David Cohen, chief global digital officer of Interpublic’s group Universal McCann makes it clear: “ In a world of finite marketing budgets, you do this in place of doing something else“. But TV won’t disappear. GM spokesman Tom Henderson says: „We don’t think one medium will replace the other anytime soon.“

Sure there are still some open questions. While advertisers have a wide range of data that indicates the TV advertising impact on people’s actual buying patterns, this kind of data doesn’t exist for the web yet. And the consumers‘ attention for internet content is usually lower than for TV content. So Google will have to offer some more arguments for investing into YouTube’s new channels. Anyway, YouTube’s original content experiment will be exciting.

For more details, read the following article below.

http://adage.com/article/digital/toyota-gm-unilever-channel-big-bucks-youtube/232958/

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