YouTube “First Watch” Creates Massive Reach For Video Ads

A very long time ago Google was trying to find alternatives to pre-roll to monetize YouTube videos. Google-sponsored consumer research in 2007 found that users don’t like pre-roll. But that’s ancient history.

Today Google is trying to find more ways to generate and capture display and video ad revenue, which it views as a massive growth opportunity for the company. And YouTube is in the center of that opportunity.

According to the NY Times, Google is testing a new program for pre-roll on YouTube called “First Watch.”

[A]n advertiser can buy a preroll spot on most people’s first view of a YouTube video each day . . . The commercials on the youtube.com home page have been “highly successful,” Baljeet Singh, senior product manager for video monetization at YouTube . . . They have been so successful, he added, that they are “starting to sell out.”

Users see an ad — the same ad — the first time they watch (non-UGC) video on YouTube and not thereafter. The Times quotes Google product manager Baljeet Singh, who says that the tests of First Watch have “performed really well” (CTR of 1 percent apparently).

The program offers advertisers reach that far exceeds anything they can buy on traditional television. YouTube is by far the largest online video property. However it lags in terms of ad impressions. Hulu generates the greatest number of ad impressions of all online video sites.

On a related note video ad serving platform FreeWheel found that 80 percent of mobile video streams were on Apple devices in Q1.

Source: FreeWheel Q1 2011

Related Topics: Channel: Video | Google: YouTube & Video

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About The Author: is a Contributing Editor at Search Engine Land. He writes a personal blog Screenwerk, about SoLoMo issues and connecting the dots between online and offline. He also posts at Internet2Go, which is focused on the mobile Internet. Follow him @gsterling.

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  • http://noodleheadstudios.com N.H.

    While I am not to bothered by pre-roll ads, I definitely hate them when they play on short videos. To watch a 15 second or 30 second ad on a 50 second video seems silly. Hopefully they manage this as nba.com makes you watch an ad every single clip.

  • RGD

    “The program offers advertisers reach that far exceeds anything they can buy on traditional television”

    This is just plain wrong. Comscore reports about 25million daily US youtube users. Assuming 75% are watching non UGC on first watch comes to about 21 million first watch streams, or about the american idol audience and less than the nightly broadcast audience.

    for the month about 290 million US 2+ watched traditional television, compared to about 150-200 million monthly youtube uniques.

  • http://screenwerk.com Greg Sterling

    RGD:

    With the exception of the absolute top show on TV — American Idol — no individual show has more than about 14 million viewers at the very most. Most popular shows are under 10 million.

    The total monthly TV audience doesn’t matter for purposes of comparison here because no single advertiser can buy spots across networks and shows; it’s prohibitively expensive.

  • http://screenwerk.com Greg Sterling

    Final comment: the top rated US nightly newscast NBC has fewer than 12 million viewers. Again if you’re talking about audiences in the aggregate, no advertiser buys across all shows in a time slot.

  • RGD

    Again with the factually incorrect. According to the most recent Nielsen report there are at least 7 shows with over 14 million viewers

    http://finance.yahoo.com/news/Nielsens-top-programs-for-May-apf-2464625959.html?x=0&.v=1

    And I highly doubt there is ever 14 million simultaneous us viewers on YouTube so don’t get your other point either.

  • http://screenwerk.com Greg Sterling

    Thanks for the ratings data. I was speaking from memory.

    The point here is one you make yourself: YouTube advertisers can buy reach across YouTube’s premium/partner content audience without having to buy any particular “show.” That can’t be done on TV. Media buyers must buy DWTS or Idol or Big Bang, etc.

    Ad skipping, Netflix, Hulu and online TV viewing have further fragmented the traditional TV audience. So while the numbers look very large in the aggregate the actual number of people that advertisers are reaching on any given show is less than what the Nielsen numbers indicate (and those numbers are extrapolated from relatively small samples)

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