What do Netflix, Hulu and now, YouTube, all have in common? An ad-free video experience, possibly foreshadowing the end might be near for online video advertisements, especially with the major streaming players.
YouTube is getting ready to launch the next ad-free video subscription service, and this is big news. YouTube tried and failed in the past to get users to pay for its content. Its first attempt was with paid channels in 2013, and then “Fan Funding” in 2014. Google and YouTube are trying again in 2015, and while not all details are official, YouTube Red will be an ad-free service with a few other unique qualities.
Introducing YouTube Red
For a $ 9.99 per month, subscribers will have access to the YouTube they know and love, with a few extra features thrown in. YouTube Red will launch in the United States on October 28th, and starting that day, users will have the chance to try the service completely free of charge for 30 days. After that, it’s time to pay up.
Video Ads Only Impact 1% of Millennials
YouTube Red will offer its videos ad-free. Currently, Disney has yet to agree to participate in YouTube’s new service. This ad-free experience will aim to deliver users a more enjoyable viewing experience without the distraction or annoyance caused by pre-roll and annotated advertising.
Millennials and individuals under 35 years are the primary users of YouTube, and it’s no wonder that the media industry is shifting more and more towards ad-free services, ad-blockers, and instant content experiences. Millennials aren’t influenced by advertising, especially not commercials. Only 1% of millennials are swayed by advertisements, and the rest? They’re using DVR and ad-blocking applications.
Users will also be able to download content straight to their desktops and mobile devices. This is a great feature for users on the go, who don’t have time to watch right away, or those who want to save content for when they don’t have WiFi. YouTube says this is good news for content creators, as there will be more opportunities and capabilities for their content to be consumed, anywhere and anytime.
YouTube is taking a page out of Netflix’s book and creating its own original series, only available to YouTube Red subscribers. In an effort to appeal to current users, YouTube is enlisting some of their biggest content creators including PewDiePie, Lilly Singh, Joey Graceffa, MatPat, Harry Shum Jr., Kina Grannis, College Humor, and many more to help create this exclusive content.
This is a feature that avid YouTube consumers are going to buy into. Millennials and Gen-Z’ers are heavily influenced by YouTube creators, perhaps more than Hollywood celebrities, and digital media company, Defy Media, found in their survey that today’s younger individuals aspire to be digital superstars with YouTube stardom over Hollywood. This is half feasibility of reaching YouTube fame vs. Hollywood fame, but the other half is overall passion for digital celebrities that feel like long-distance best friends instead of buttoned-up, distant characters.
Background Play Multitasking
YouTube Red will help you multitask like never before. Paying subscribers will be able to check Facebook, browse Instagram, and perform other tasks while listening to a song, and switching to those other apps won’t interrupt your video too. This feature will be more useful for long-form content such as web series videos and interviews.
Bundling of YouTube Music and Google Play Music
What sets YouTube apart from the other video subscriptions is the bundling of YouTube Music and Google Play Music along with a YouTube Red subscription. Differentiating itself from the competition, YouTube Red is offering two services for the price of one.
How Does This Impact Video Advertisers?
With Hulu, Netflix and now YouTube offering ad-free services, it would seem that advertisers should be worried. However, advertisers don’t need to press the panic button quite yet. Youtube isn’t shutting down their free service, which billions of people use and love. Of course, not every YouTube user will convert to YouTube Red’s paying model, so everything you knew about the current version of YouTube will still be an option.
In the past year, YouTube’s advertiser roster grew by 40%, and its top 100 advertisers have increased spending by about 60% each year. All advertisers, especially video ones, should strive to reach audiences with valuable and entertaining content, and not disruptive messaging that is irrelevant or poorly timed. If you’re marketing to Millennials and Gen-Z members, this holds extra weight.
Selling to these demographics is more challenging than ever, and if you’re still using traditional methods, including YouTube, you will soon be forced to create content and reach individuals in more meaningful and welcoming ways. It’s a tough world for marketers and content creators, and YouTube Red is just one small piece of the industry’s massive puzzle.