YouTube went to great lengths to ask (and even threaten video creators with reminders of their contractual obligations) to prevent stars doing sponsored videos. As I’ve addressed before, some advertisers were circumventing lucrative media spends by working directly with top stars. That’s especially smarmy when the Google folks pitched the star, and the agency or brand cut YouTube out (see my quotes in a MediaWeek article).
But YouTube recognized the desperation of YouTube stars — hoping to better monetize their content — and began to quietly relax that rule this summer… even inviting creators to choose whether ads should run, or indicate (voluntarily) that the video is sponsored, which automatically turns off ads.
Ironically, a recent Carls Junior campaign (in which stars were selected and paid via YouTube to endorse a $6 mushroom burger) shows that while most creators turned off InVideo ads, some are still allowing them… and now Wawa is snatching the inventory (see image below) with Hoagiefest ads. An oversight by the stars, YouTube or the agency?
Who wins here? Nobody. If I was Wawa, I wouldn’t want my ads appearing next to Carls Junior sponsored videos facilitated by YouTube. If I was Carls Junior, I’d be frustrated that a competitor is buying ads over the content I commission and funded via a fixed-fee sponsorship. If I fund the star videos, I’d want either my own ads, no overlay ads, or at least category exclusion for some period. And if I’m the star, I’m jeapardizing future deals by ticking off paying sponsors.
Here’s hoping this was a technical glitch or a temporary oversight. A creator loves to double monetize (run ads over sponsored/endorsement videos) but it’s really not fair to advertisers… Especially the sponsor that commissions the video.
For example, if I did a video for a Holiday Inn, and left ads running… Motel 6 could capitalize on that video. Holiday Inn would feel cheated, and that’s why you won’t find ads running on any of my sponsored videos.
Solution: Whoever brokers the deal (in this case, YouTube with some digital agency partners) needs to set up the rules upfront and enforce them. Some of the videos got millions of views, which would otherwise produce significant ad revenue for YouTube and the creators beyond the generous check creators got for making the video. Future ad deals should reward the stars that get top views by buying all the inventory for the commissioned videos for a certain period of time, so the creator (and YouTube) are financially rewarded for getting the videos seen (which is ultimately vital and in the control of the star and YouTube). If necessary, cap it. Alternatively, ensure the fixed sponsor payment is sufficient enough to make it worthwhile for the star to turn off ads, knowing there will be no additional upside for the star if the video goes wildly viral (and that YouTube loses its incentive to “microfeature” the video by spotlighting and other ways).
But we don’t want these blunders making advertisers nervous about what can be terrific programs that combine the entertainment value of the stars with the impact of paid media, which incents YouTube to get the videos a broader audience than the star’s organic one…. and the combination of a CarlsJr overlay ad with the sponsored video would certainly increase awareness, intent, and purchase far beyond sponsored videos or ads alone.