According to a report by Alphabet inc. (the parent company of Google, Youtube), YouTube Shorts, one of the new features under the YouTube video sharing platform, has reached a staggering 30 billion views per day since its first three months in 2022. This is four times higher than the same period last year. As a result, YouTube’s Q1 2022 earnings conference indicated that they will be adding an advertising system to YouTube Shorts. What details will there be? What should marketers or brands know? Let’s take a look together.
Marketers, Prepare for Ads in Shorts
YouTube has confirmed that it is currently testing an advertising system in YouTube Shorts, which will allow creators or channel owners to generate additional income. This decision may be due to profits not meeting the company’s expectations, coupled with the increasing popularity of the Shorts feature as short-form videos trend. Therefore, the company must decide to add an advertising system to YouTube Shorts to appease shareholders.
Ruth Porat, CFO of Alphabet inc., confirmed that “We are facing slight revenue growth as users increasingly watch short-form videos in Shorts. We are therefore starting to test an advertising system to align with business performance, and the results of the advertising system tests in Shorts have been well received.” Advertising on Shorts will allow creators in the YouTube Partner Program to generate additional income. Previously, the only way to earn money from the Shorts feature was through the YouTube Shorts Fund, where the fund allocated approximately $100 million to creators who created short video clips and gained popularity or went viral, without limiting whether creators had to be in the YouTube Partner Program. It remains to be seen whether this fund will still exist if a full-scale advertising system is launched.
YouTube Shorts Vs TikTok
Excluding sponsorships and additional product sales, earning income solely through the payment system of a short video clip platform is quite difficult at present. As mentioned above, YouTube Shorts pays creators through a grant system, which is not very high. In contrast, TikTok, which has the highest user downloads at present, pays much less. According to a tweet by @SuperSaf, a popular creator on TikTok with over 400,000 followers, he posted a picture of his income from all 25 million views of his channel, but only received 112.04 euros from TikTok.
Therefore, the adjustment of strategy to add an advertising system to YouTube Shorts, which YouTube has confirmed will help generate additional income, is interesting to see whether it can attract new and old creators to use YouTube Shorts more and reclaim the throne of the video sharing platform from TikTok. Let’s watch together.
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