YouTube Launches AdWords For Video

Video production is getting cheaper, so Google is creating a self-service option for pre-roll advertisements aimed at small- and medium-sized businesses.

Google's AdWords program has long been an easy way for businesses of all shapes and sizes to post their ads on Google Search results. Now the company is expanding those capabilities to YouTube with its launch Monday of AdWords for Video.

As with the Search product, AdWords for Video is self-service. It allows small- and medium-sized businesses to bid on keywords and categories and have their video ads appear in front of some of the 3 billion YouTube videos that get viewed every day.

The move, though, signifies a larger shift. It used to be that only larger companies could afford to place video ads (or, more specifically, TV ads). They were simply too expensive--to produce as well as to air--for the average mom-and-pop.

But the cost of producing video has plummeted (this company made their first ad for $500), finally putting "TV" ads within reach of the masses.

That's good news for small businesses, because video can be a powerful tool for drumming up interest from potential customers.

RevZilla, a motorcycle gear company based in Philadelphia, has long been placing video ads in YouTube search results. Founder Anthony Bucci tells Fast Company that video will become increasingly common for smaller businesses like his. "Depending on the business and how it reaches consumers, every business is going to potentially shine with video in different ways," he says.

The new AdWords for Video product introduces a level of standardization with Google's other services that will make it easier to buy pre-roll. "The way we set up a new video ad feels the same as if we were setting up a banner or search ad [in AdWords]," Bucci says.

EMarketer says video is the fastest growing online ad format. It projects that the share of online ad spending going toward video will double this year, from 7.9% to 15%. And according to Google, 50% of online ad campaigns will include video by 2015.

The service also allows users to place ads on mobile devices. Baljeet Singh, Group Product Manager for YouTube, tells Fast Company the company is planning to expand the service to other platforms, like connected TVs and game boxes.

AdWords for Video will also use YouTube's "TrueView" system which only charges advertisers when users actually watch the video, Singh says. That's a shift from the classic CPM charge model, which charges per impression. Small businesses need to stretch their ad budgets as far as possible, so providing a service that only charges them when viewers actually watch the ad makes the service increasingly attractive to those buyers.

The introduction of AdWords for Video is part of a larger emphasis at Google on small and medium-sized businesses. (See: "Google Goes After Your Local Small Business.") "This allows them to play big with bigger advertisers," Singh says.

A beta program for the service began last year. Google won't reveal the number of advertisers participating, but Singh does say that the number of advertisers using AdWords for Video increased 10x from the end of last year's Q4.

[Image: Flickr user Mehdi]

E.B. Boyd is FastCompany.com's Silicon Valley reporter. Twitter | Google+ | Email

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3 Comments

  • Anita Loomba

    Considering that Video was listed as an upcoming marketing trend in 2012, this isn't very surprising. I like that Google is offering free advertising for brands looking to test it first. It will be interesting to see how companies embrace this platform.

  • Sean Murphy

    Small and medium sized businesses who are serious about making making money with video should check out a hip new startup called Vidstore. Instead of ads, they help companies build their own Netflix.

    Check them out and give them some media love on Fast Company!

    http://vidstore.com