Merchant Innovation

YouTube Open For eCommerce Business

YouTube — it’s not just for cat videos, pregnancy announcements and pirating music anymore. Now, it’s also about shopping.

Specifically, Google is pairing up some ads with videos based on its algorithms. The ads will be small and basically unobtrusive — a small box appearing in the upper righthand corner of the screen. Clicking that box will present consumers with a drop down menu with a series of items available for purchase.

The move is the latest in a series by the nation’s premiere video sharing service to find a way to better monetize the platform. In 2014, ad revenue on the site broke just about even (even though it managed to bag $4 billion in total funds brought in). A subscription service was also recently announced.

But YouTube itself is something of an advertisement, given one of the more common uses of the platform is as a clearing house of sorts for various types of product discovery, from reviews to walkthroughs to tutorials — people often come to YouTube to watch products in action.

Products that they are then going to buy elsewhere — often online. The U.S. Commerce Department noted that digital commerce in 2014 was worth over $300 billion for the first time and that is a piece of the pie Google is looking to get served.

“What we realized here was that there was a great opportunity for our users, our creators and our advertisers,” Diya Jolly, head of ads at YouTube, noted of the over 1 million channels on YouTube directed toward product discovery.

Merchants will be able to access the ads through the same process they use for regular shopping ads — auction. Content creators will also enjoy the same revenue split they do now with advertising.

“This is a native ad format. We’re doing a lot around native ad formats, and this is just one thing that we’re trying,” Jolly said.

The ads will begin appearing this week and will spend much of early 2016 rolling out.

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Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out the February 2019 PYMNTS Digital Fraud Tracker Report

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