Of Course You Can Trust Us— We’re Google!

What, exactly, is YouTube selling? That’s the question on every buyer’s mind in the wake of the company’s “brandcast” presentation in New York a few weeks ago. It wants advertisers to commit to yearlong, all-inclusive sponsorships of its fledgling channels for prices in the $5 million range, as well as a high $20 cost per thousand viewers for pre-roll. But it’s using proprietary numbers from parent company Google to guarantee audiences, and some buyers are balking. The entire proposition behind the digital NewFronts was that ad buyers could confidently move TV dollars to digital, where they would find similar or greater penetration for less money while associating with top-tier content. There are even rumors that YouTube has a subscription-based service like Hulu in the works. But measurement is a sticking point. Imperfect as Nielsen is (and complaining about measurement is a team sport in the TV world), it provides a universal currency in a way that isn’t yet duplicated in the online world. ComScore and Nielsen’s Online Campaign Ratings (OCR) and Cross-Platform Campaign Ratings (XCR) are still duking it out for supremacy in that marketplace, and while buyers have expressed reservations about those systems, they’re even less enthusiastic about buying YouTube audience guarantees measured by the company selling the ads. “It’s too early to tell the quality of that offering,” said one digital buyer at a large agency who asked not to be named. “The guarantee products from Nielsen and comScore are the ones we’re putting more weight and priority in, given that they are third parties, and Google is a proprietary source.” There’s also YouTube’s pledge of $200 million in promotion and marketing for its new 100-channel lineup. “There is a question about how YouTube will promote the programming beyond Google Network. And how do they determine certain programming to be ‘winners’ or ‘hits’?” the source asked. “That is still not clear as well.” These frustrations may in part be a function of the ad industry running up against Google’s rule-the-world ambitions; the tech company, much like Apple, wants to be in command no matter where it is. In advertising—particularly TV advertising, where networks provide solid guarantees—third-party measurements are essential proof of your business model’s viability. Buyers also worried that YouTube could spread itself too thin with 100 channels. The mantra at the NewFronts has been “If you build it, they will come,” said GroupM’s Tom Dempsey. “But will they return?” YouTube contends that spread across 100 channels its 25 hours per day of new programming should satisfy anyone. “We have plenty of content for advertisers to buy across demos,” said a spokeswoman. “We’ve been conservative in our forecasting, and we’re completely comfortable that we can deliver the inventory that we have sold to advertisers.” Sources close to the company point out that comScore measures the same data Google is selling. The real test will come if there’s a discrepancy between the two. More generally, there’s a feeling among digital advertisers that the NewFronts may be barking up the wrong tree by going after TV. “There’s this assumption that all this online advertising is going to be paid with television advertising dollars,” said Jason Krebs of Tremor Video. “Television has continued to grow. Would it have grown more if there hadn’t been that increase in digital? Well, who knows? We don’t just speak to television advertisers. We don’t care where the money comes from. If newspapers aren’t effective, we go to the newspaper budgets.”

Performance Marketing

Of Course You Can Trust Us— We’re Google!

Buyers are intrigued by YouTube’s 100-channel rollout. But the high CPMs? Not so much.

Sam Thielman

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Sam Thielman