Rise of YouTube Premium and Influencer Marketing.
Regarding pricing, what is the big difference between TV and Digital Marketing?
In TV, the pricing is content-based.
Content with a high TRP rating commands a higher premium.
Digital Marketing is value-based.
The high value & high margin category commands a high premium.
So today, close to 2% of YouTube users are on the premium.
There are of two types.
- YouTube power users
User with more daily and monthly watch time
- High-value users
Users who spend money frequently online and also buy high-value goods
Firstly, If the power user leaves the targeting bucket(YT premium users), we can't build frequency in the brand campaign. For brand campaigns, the average frequency per user is primarily driven by the power user who will get more ads. If they move to premium and stop seeing ads, brands can’t build frequency in their campaign.
Secondly, if you can't target high-value users, you can't have a good ROI campaign. In many developing countries, only some of the online users transact. In countries like India, this percentage is less than 15. If these users move to premium, they won’t see the ads. If they don’t see the ads, their campaign won’t get conversion.
When both happen, brands gravitate towards content creators instead of platforms to build frequency and acquire high-value users.
Probably, the next big platform in digital marketing will be a platform that aggregates content creators and provides an excellent demand side platform for the marketer.
