In brief: Google and YouTube are continuing to push forward with an approach designed to further capitalize on ad revenue associated with TVs and the general increase in the emergence of a streaming culture. As Gooogle today announced the launch of a new device type - TVs. Google made the announcement via its Marketing Platform and essentially confirmed that going forward marketers and developers will now be able to use “TV” as a screen device type and as a means to increase the level of ad targeting through the implementation of curated and platform-specific ad campaigns.
As a byproduct of the separation of TVs into its own device form option, this will also make it much easier for marketers to gauge the impact of ads that are run specifically on the TV platform compared to other platforms. Thereby the change is not only designed to build on the quality of the ways ads can be served to YouTube viewers based on the type of device they are using, but also the means of analyzing the strength of those served ads, which in itself will feed back into the ad campaign creation process. While the form is discussed within the parameters of TV, this should be understood as more of an umbrella term which will equally apply to most, if not all other TV-based devices and solutions, including but not limited to gaming consoles, set-top boxes and streaming devices, such as Chromecast.
Background: YouTube is an ad-based entity and like any service that now operates at a streaming level, the influx of more users to a streaming lifestyle of late has opened the door for potentially massive increases in the revenue associated with ads served via the platform. Something that is expected to exponentially grow as time goes on and more users move away from traditional means of TV consumption and to streaming-based solutions. To put this into perspective, during today's announcement Google cited its own data (collected June, 2018) which shows users are now consuming in excess of 180 million hours of YouTube each day on TV screens. In comparison, in another announcement made by YouTube in April of this year, data from Google (collected October, 2017) showed the level of YouTube consumption via TV screens equated to 150 million hours each day. Representing a significant increase in an eight-month period alone.
However, when it comes to YouTube, and specifically marketers who make use of Google Ads and Display & Video 360 -- previously known as Google AdWords and DoubleClick Bid Manager (DBM), respectively -- TV was not considered a platform in its own right. Instead, the platform fell under the “mobile” term, accompanied by the two other main product categories: computers and tablets. This essentially resulted in a situation where marketers using ads via YouTube on TV devices were resigned to serving those ads in the exact same way that they are served to smartphones. In other words, YouTube at the ad level did not distinguish between a TV and a phone, and this is now what has changed with Google introducing TV as a separate and dedicated device type of its own, affording marketers the option to utilize an ad campaign which targets ads on an equal footing to how they are targeted when it comes to a mobile phone - or for that matter, a computer or a tablet.
Impact: To be clear, this does not mean users should naturally expect to see more ads in the future when viewing YouTube content on a TV, but what it does mean is the ads a viewer does see are likely to be far more targeted for the platform in which they are being viewed on and the data obtained from ad viewership will now be far more obvious and useful at an analytics level. Likewise, this is not simply an aesthetic change, but one which is designed to ensure engagement with ads is also increased (the ultimate goal in the mind of Google, YouTube and marketers) and Google looked to highlight this point today by drawing on data from recent Ipsos Lab Experiments that have reportedly shown an uptick in engagement for ads shown on TVs, and specifically when it comes to ad recall (the effectiveness of an ad defined by a viewer’s ability to remember the ad after the fact), and purchase intent (the likelihood of a viewer to purchase based on exposure to an ad). Therefore, in principle the impact of this change is not only that viewers will be exposed to ads that are more custom-based for the platform, but also their level of engagement with an ad that is shown on a TV will equally be increased. Both in terms of the awareness of the ad and the actual viewer’s intention to purchase following exposure.
It’s worth noting that today’s announcement was in relation to the launch of the new device type and not the actual announcing of the expansion of device categories in general, as Google had already in the past few months made it clear this change was coming. This also follows on from an announcement made earlier in October (during New York’s Advertising Week event) where Google confirmed more wholesale changes were coming to YouTube in general, and across multiple platforms. In particular, how marketers will be able to soon offer richer ads with more actions that are also designed to increase the ways in which a user can engage with an ad when it's shown. In many ways, those more wholesale ad changes will now be much easier to implement for those marketing for TV thanks to the introduction of the new TV device type. As like the ads in general, the proposition now offered to marketers will be actions that lead to greater engagement can now be as customized to the TV platform as the ad itself. So there are multiple aspects in play here and numerous ways in which the introduction of the TV device type will impact on the viewer, although they all primarily boil down to the same single ambition - higher ad engagement.