We live in a time when, thanks to TikTok, the short-video form factor is crazy popular and has extreme potential for monetization. Naturally, every social media platform wants a piece of that pie. We have Instagram and Facebook with their version — Reels — and we have YouTube with its Shorts.
As Bloomberg first reported, YouTube wants to increase its earnings from Shorts and has begun experimenting with ads on its short videos. Currently, the ads you will see in Shorts are mainly the app-install ones, but there may be other promotions sprinkled in as well.
It looks like the experiment is going well for the platform. Philipp Schindler, Google’s chief business officer, told investors, “While it’s still early days, we’re encouraged by initial advertiser feedback and results.”
But why now, Google? After all, the tech giant introduced YouTube Shorts in 2020 and needed two years to add advertisements to its short videos. A possible reason could be that, for the first quarter of 2022, YouTube’s ad revenue growth was 14%, which is lower than what was expected by the analysts. It received $6.87 billion in revenue, compared with an expected $7.4 billion.
Also, the tech giant has noticed a decrease in direct response ads, like app-install campaigns. And since Shorts now receives 30 billion daily views, Google is leveraging that to increase YouTube’s ad revenue and simultaneously the direct responses of its ads.
The tech giant has noticed a decrease in direct response ads, like app-install campaigns. That’s why it decided to leverage the 30 billion daily views that the Shorts platform gets to boost specifically those types of advertisements.
