YouTube has changed the way we watch content. Its impact on the internet is huge, and it’s also become an important tool for businesses to attract new customers through ads.
Year after year, YouTube’s advertising system has been perfected, becoming a powerful tool for marketers around the world. Let’s take a look at how it all evolved.
The Beginning and Early YouTube Achievements
The official launch of YouTube took place in 2005. The project was registered on February 14, 2005, by Steve Chen, Chad Hurley, and Jawed Karim, three former employees of the American e-commerce company PayPal.
The first video is generally considered to be “Me at the zoo“, which was uploaded to YouTube on April 23, 2005, at 20:31:52 PDT, or April 24, 2005, at 03:31:52 UTC. In the 19-second clip, YouTube co-founder Jawed Karim, who was 25 at the time, stands in front of two elephants at the San Diego Zoo (California) and draws attention to their long trunks.
In its first year, the platform crossed the threshold of 100 million video views per day. But it wasn’t until mid-2007 that YouTube started experimenting with new ad formats, introducing InVideo ads in August and the Partner Program in December, which was a kind of start to turn the platform into an advertising monster.
The first ad formats on YouTube were display ads, similar to those that could be found on many websites at the time.
In 2006, an important step forward was made: Participatory Video Ads (PVA) and Brand Channels appeared on the platform, providing a more engaging experience for users. However, the real breakthrough came in 2007 with the introduction of InVideo Ads, which allowed ads to be overlayed directly on the video.
Expanding the Advertising Arsenal
In 2008, YouTube introduced the Insight analytics tool and the Screening Room, which helped to expand its advertising capabilities. After partnering with CBS and MGM for full-length content, pre-roll ads, which played before the start of a video, were launched on YouTube.
That same year another feature appeared – Promoted Videos. The principle of advertising videos on YouTube resembles the mechanics of advertising on Google. These videos allow advertisers to attract viewers’ attention, increase the number of video views and channel subscribers, and ultimately – influence conversions. Promoted Videos are displayed based on the user’s search queries, appearing either at the top or to the right of the search results.
In 2009, YouTube allowed ads in seven different formats, providing advertisers with even more flexibility. The number of video views increased manifold, exceeding one billion views daily. This rapid growth positioned YouTube as an attractive platform for marketers around the world.
By 2010, YouTube had completely revamped its video pages and launched the YouTube Rentals movie rental service. The platform was already counting two billion video views per day by that time.
Integration with Google and Modern Advertising Strategies
Google’s acquisition of YouTube in 2006 for $1.65 billion provided the platform with the opportunity to leverage Google’s powerful advertising ecosystem. YouTube and Google’s advertising business were closely integrated, and by 2010, 94 of the top 100 advertisers according to AdAge were running campaigns on both platforms.
Today, YouTube employs several advertising formats that were developed taking into account how users interact with the platform. From ads on the home page and in search results (Promoted Videos) to InVideo ads and pre-rolls, YouTube has created an advertising ecosystem that caters to a variety of user experiences.
How Does YouTube Decide Which Ad to Show?
YouTube’s ad targeting system is based on a variety of factors, including video viewing history, web browsing history, video interaction, and demographic information, such as age, location, and gender. This data-driven approach ensures ad relevance to the viewer, benefiting both users and advertisers.
Have you used YouTube advertising in your campaigns? Tell us about it in the comments, and don’t forget to share if you found this interesting.
