Of course, BNET is on YouTube

(Episode 336; 12 minutes 14) YouTube is one of the world’s most popular websites. A lot of us spend a lot of time online watching videos there. Today it’s not just a tech-savvy audience. Faster internet speeds mean it’s a medium that is attracting a broad section of the community.

So how can a business benefit from YouTube? Today on BTalk, Jason Chuck, head of Marketing for Australia and New Zealand at Google, suggests ways that businesses can use it to build a stronger relationship with potential customers.

Does your business use YouTube to communicate with customers? Tell us your experience in the Talkback section at the end of this post.

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View all BTalk Australia podcasts here.

• Transcript

Phil Dobbie: Hello I’m Phil Dobbie. Welcome to BTalk Australia. Today YouTube. It’s one of our favourite places to watch videos. In fact we watch music videos, movie trailers, news clips and TV shows. So what does it all mean for a business wanting to reach such a vast proportion of the Australian population? That’s today on BTalk Australia.

YouTube is certainly a phenomenon isn’t it? Everyone uses it and it shows no signs of waning, but is it much of a tool for business? Well, Jason Chuck is the head of Marketing for Australia, New Zealand Google, and Google of course owns YouTube these days. They paid a handsome $1.6 billion for it, you might remember a few years back. So just how big is YouTube Jason, how many Australian’s are watching it?

Jason Chuck: Today there’s roughly about 6.3 million Aussie’s that are using it on a monthly basis and we see that over a million actually come to the home page on a daily basis.

Dobbie: On a daily basis?

Chuck: Yes

Dobbie: That’s incredible isn’t it?

Chuck: It is.

Dobbie: Is the age range changing? It used to be, I guess, a bit of a nerdy thing, but I guess those days are well behind it now. Now there’s a million people, I guess it must be across all age ranges, is it?

Chuck: Well it’s funny, yes there’s definitely that conception that YouTube is for the tech-savvy end of use. A lot of the Gen Y’s, but what our research has found out is that the YouTube demographic really mirrors Australian population, and you actually see that from people over the age of 60, are actually 10 percent of the YouTubers actually come from that range. Over 40 percent are over the age of 40, and it really mirrors the population and they’re just very engaged with the platform.

Dobbie: And are we spending a lot of time on it?

Chuck: Yes, definitely. Actually one of the very interesting things that we saw were that about 78 percent of people who come to YouTube actually come to watch one video, but in the end they actually on average spend an hour and nine minutes every week, on the platform.

Dobbie: Right. Which is a lot compared to other websites that’s an astronomical figure isn’t it? It’s a big chunk of your online time. So how many videos are there on YouTube now? I guess the answer to that’ll be different in a week’s time, but as we talk roughly how many are there?

Chuck: I think there is definitely millions and millions of videos, roughly about 20 hours of video get uploaded every minute on YouTube. So if you’re actually going to watch, for instance, all the videos that’s uploaded in a day, it would actually take a human like three and a half years of their life which is quite amazing.

Dobbie: So businesses are starting to use it a bit now aren’t they? A lot of companies I think release a TV campaign and they stick the ad up on YouTube, but we don’t normally like watching ads, so the idea of actually going to watch an ad voluntarily seems a bit strange, but for some ads it works and for some it doesn’t.

Chuck: We’ve actually found that the YouTube community is very engaged and the type of content really differs by the different demographics, but what was interesting to see was that almost a quarter of the users of YouTube actually do enjoy watching ads, but it really depends on the type of ads. So as you’re saying, if a TV commercial was built and it’s been on TV for a month already, and then somebody just puts it onto YouTube, then you know it’s probably hard to expect that that’s going to generate a lot of interest unless it was very funny, great phenomenon, but we are seeing a lot of advertisers who are building content specifically for YouTube and really trying to have a voice with the community and talk to them using the platform and we found that that’s actually a very successful way to reach the audience and engage in that sort of conversation.

Dobbie: So some of the successful made-for-YouTube ads, what sort of audiences are they getting?

Chuck: It really depends because the way that you advertise on YouTube really differs by what your goals are, so some people will use a traditional ad. For instance on the homepage, they may take over the masthead as if a new movie’s going to be launching, they really want to generate a lot of buzz and awareness about the movie trailer in the cinemas, but there’s a lot of companies out there that actually want to have an active user engagement so, for instance, the Sydney Opera House recently launched a campaign which is actually a dance competition called My Mutation, where they were wanting the YouTube community to actually solicit videos of them dancing and you could win a prize to actually fly to Sydney and perform live in the Opera House. So depending on your goals, if you really want to really engage and touch the community or you’re just trying to drive mass awareness, there’s a different solution for different groups.

Dobbie: That is the key though isn’t it? That sort of level of involvement from your potential customers cause that really does multiply the exposure you get, rather than producing one video yourself. Get people to produce videos for you for a competition or something like that, that’s got to be a magic formula isn’t it?

Chuck: Completely, one of the things we saw recently was McDonald’s, they actually took an ad that was found on YouTube user-generated content and they actually ended up using that as their television commercial on TV, so actually in reverse, they actually found these two fellows online who were doing this kind of Chicken McNugget rap, and they actually ended up just skiting it and putting it on TV, which actually worked out very successfully for them.

Dobbie: It’s interesting isn’t it, cause I think one thing that might be happening because of all of this, is that before we had a particular standard that we expected from TV commercials, you know that highly polished agency produced, hundreds of thousands of dollars production. Now we’ve got used to seeing the amateur stuff and we don’t seem to mind it too much, and maybe companies can learn a bit from that that actually it’s the content rather than the production values that really count at the end of the day.

Chuck: Completely, actually one of the really interesting stats that came out of the research was that we found that our users actually trust the user-generated content just as much as they trust the professionally developed content. And as you’re saying, with YouTube as a platform, it’s just built as a way to test and experiment your messaging, so you don’t need to spend months or weeks developing this one TV commercial and hoping that it’ll be a success. You can trial a lot of different types of videos and we have the tools onboard with our insights tool for YouTube where you can actually see when somebody’s watching a video, if for instance, they leave after 20 seconds you can see that you need to put your brand in the first 20 seconds in, and how to test and engage.

Dobbie: That’s such a great way of testing a TV commercial before you even run it on TV as well isn’t it? Sort of like an excellent piece of market research.

Chuck: Completely, especially if you’re looking to trial different calls to action, and if you think that different messaging may be turning off the audience, it’s probably better just to create the five different versions, if you’re in the studio, at once, throw them all up on YouTube and then see what sticks. And then usually the audience gravitates towards one and then that’s probably the one you want to send out to the masses.

Dobbie: Now I’d imagine the other big opportunity for businesses is in self-help type videos. Everybody in almost every industry is crushed with the huge costs of running call centres to provide customer support. If so, many people on YouTube demonstrating stuff visually is obviously a lot easier than trying to explain things over the phone, are we seeing a lot of businesses using it for that purpose?

Chuck: Completely. Actually one of the things that we did was, within part of this research, we actually asked within different industry segments what type of videos that people most like to engage and watch. And for instance, the very tech consumers when they’re looking to buy consumer electronics, the how-to videos were the number one type of videos, the demonstration type of videos that they flock towards as opposed to necessarily funny clips or things using telephones etcetera. Whereas for an auto buyer, the how-to DIY videos were still very popular but they weren’t as popular for instance compared to like car reviews or informational entertainment sort of “Top Gear”-type videos.

Dobbie: Right. Now we’re seeing a lot as well of course, a video explosion in a way, and part of that is being driven by the fact that it’s getting cheaper and cheaper to buy video cameras in particular high-definition video cameras. I mean, we’ve got cameras like the flip in the States selling for about US$150. The price is just spiralled downwards, that must be having a big impact on not just how many videos there are, but how many high-definition videos you’re finding on YouTube these days.

Chuck: Yes, it actually works both ways with the hardware technology prices coming down. We definitely see that every digital camera has a video mode, we’re seeing a lot of the high-end phones these days can record video directly there and upload it with one touch.

Dobbie: Yes

Chuck: And as you’re saying with the flip cams, it’s a very inexpensive way to be able to take a video, just plug it in through the USB and it immediately goes up.

Dobbie: Yes, I saw one of those the other day, I mean they’re not available in this country yet, but I think they will be in a month or two, and they’re phenomenal.

Chuck: Yes, they’re wonderful, we love playing with them and using them as well.

Dobbie: Now do you think we’ll soon be watching YouTube? I know some people do, but do you think it’s going to become the mainstream that we’re watching YouTube on our TV? Do you think IPTV will arrive in our living rooms soon in this country?

Chuck: Well it really depends on people’s choices. We are finding that people are spending more and more time on YouTube, and it is reaching more and more devices. Especially with things like the iPhone, and more and more powerful mobiles that people are watching on different, not just on their PC any more, so I wouldn’t be surprised to see it over the coming years more pervasive in different formats such as on television. And especially as the NBN rolls out and we have faster broadband rates, people will be able to watch longer form content and you have a great experience with longer sort of videos as well. So I definitely think that it is moving that direction.

Dobbie: Right, and YouTube sort of seems to be in a transposition, doesn’t it really? There’s no one really clipping at your heels trying to provide a credible alternative or at least succeeding?

Chuck: Well, I guess YouTube’s part of this whole idea of entertainment online, and there’s many different choices for people. And not everybody necessarily watches video, a lot of people like to consume their entertainment in different ways, and they’ll read and engage with formats in different ways, but at the same time we do get a lot of feedback, especially with the fact that technology is changing so quickly, we need to keep innovating by adding these features such as HD and the mobile features etcetera, etcetera. So the technology changing is actually definitely keeping us on our toes.

Dobbie: Yes, certainly. Final question which I’ve always found curious, and I know a lot of other people have asked exactly the same question, how do you guys make money from it?

Chuck: Well, it’s similar to Google, it’s primarily through advertising, so as we’re saying earlier there’s a number of different advertising models on YouTube, and we’re constantly experimenting to find out what is the best way that doesn’t intrude on our users’ user experience. So an advertiser can actually target specific demographics on YouTube to show their ads, whether it’s like a banner or a display ad at the top of the home page, or maybe an in-video ad that kind of overlays while people are watching videos. We have a number of different ways for people to experiment and test.

Dobbie: The old proven model of online advertising always seems to work, doesn’t it? Jason thanks so much for your time today.

Chuck: Thanks so much Phil.