YouTube must scale mobile business as digital video views take off
By Chantal Tode
March 22, 2013
While YouTube has done a good job so far of addressing its growing mobile user base, the revelation that the total number of active users recently reached one billion for the first time points to the need for the company to quickly scale up its mobile efforts or risk getting left behind in this fast moving segment.
While desktop users are still the biggest users of digital video on YouTube, mobile accounts 25 percent of YouTube’s user base and continues to grow. In fact, YouTube said this week that the amount time spent watching YouTube via smartphone by Gen C users – those who have grown up accessing content across multiple channels – increased 74 percent in the past year.
“Mobile users make up approximately 25 percent of YouTube's one billion users, mobile has played an enormous role in YouTube's growth to date,” said Jason Stein, president of social media agency Laundry Service, New York.
“Going forward, YouTube's desktop video viewing continues to decrease while mobile grows, so mobile will play an even more critical role going forward,” he said.
“YouTube videos are perfectly optimized for all mobile devices, and its TrueView ads work nicely on mobile as well. So they've done a great job to date, but what it needs to do moving forward is figure out how to turn this into a scalable business.”
YouTube faces several challenges in continuing to build its mobile business, including creating better opportunities for marketers.
For example, advertisers do not know what third-party party pre-roll ads will be layered on their content.
Also, the ability to drive call-to-actions outside the YouTube site is not as strong as it should be.
Perhaps the biggest challenge for marketers is creating great content and then figuring out how to distribute it efficiently within the YouTube ecosystem and outside of it so that they are showing the right content to the right people at the right time.
“YouTube has done a solid job of monetizing pre-roll advertising in only charging the advertiser for the instances that consumers don't skip through the spot,” said David Hewitt, Atlanta-based vice president and global mobile practice lead at SapientNitro. “They need to do a better job of filtering spam comments and finding better ways to curate collections of spots that could be strung together for longer session viewing.”
YouTube recognizes the need to support marketers and this week introduced new research into how Gen C is using YouTube.
Gen C is a powerful demographic, Google advertising research director Gunnard Johnson wrote in a post on the Google blog this week. These consumers are cultural tastemakers and influence $500 billion of spending a year in the United States.
However, Gen C can be hard for brands to reach because they are 45 percent more likely to be light TV viewers and often consume content across multiple screens.
YouTube says it is one of the primary daily destinations for this group. Its research shows that in 2012 the number of Gen C viewers who regularly watch YouTube on smartphones caught up to the number of viewers tuning in on their PCs. Additionally, 67 percent of Gen C watch YouTube on two devices or more, compared to 53 percent of the general population.
Gen C tunes in to YouTube throughout every part of their day, according to YouTube, and peaks during primetime hours, just as on PCs.
The research also shows that Gen C watches YouTube on their smartphones as a complementary activity to their lives, with 41 percent tuning in to YouTube on their smartphone while waiting for something or someone, 18 percent while commuting from work or school and 15 percent while commercials are running on TV.
YouTube is a destination for Gen C smartphone users, with 47 percent actively searching for videos on YouTube.
Gen C smarpthone users also discover videos socially, with 9 percent of respondents saying they watched a video on their smartphone because it was shared by friends in an email, while 18 percent watched a video because it was shared on a social network.
“YouTube has dominated the mobile video space by capitalizing on user-generated content and optimizing access and presentation across such a wide range if devices and form factors,” SapientNitro’s Mr. Hewitt said. “YouTube will continue to try and 'channelize' their content as they aim for the big screen, tailor to individual consumer taste, and balance short form with longer form content.”
Chantal Tode is associate editor on Mobile Marketer, New York
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