The ongoing advertiser boycotts of Google properties, specifically YouTube, have captured media attention in a way few industry controversies have in recent memory and raised the question of whether there will be a ripple effect on how marketers think about social spending and platforms more broadly.
As the situation turns into a bit of a waiting game — many brands can't afford to miss out on the reach offered by Google, which likely wants the PR nightmare to end — early indications are that some brands are taking their budgets elsewhere. If YouTube is able to address the issue quickly, any impact on budgets is likely to be a small blip. But if the troubles drag on, there could be a number of beneficiaries as spend shifts, including Snapchat, Facebook, Twitter, mobile video advertising, in-app video and competing TV-like channels.
"Brands could definitely take this recent boycott as a charge to test some new options out," said Stephen Boidock, director of marketing and business development, Drumroll. "Mobile video advertising and in-app video advertising continue to see healthy increases in spend year-over-year, so this might be a chance for brands to test the waters."
The issue started when a number of U.K.-based brands and organizations, along with the French advertising giant Havas, pulled their spend on Google, citing the tech giant's failure to guarantee ads wouldn't appear next to content featuring material like hate speech and terrorism. This "brand safety" boycott quickly escalated to a global scale, with many U.S. companies including AT&T, PepsiCo, Wal-Mart and Johnson & Johnson joining the fray through varying degrees of budgetary freezes.
In response, Google has offered more transparency into YouTube inventory, along with entirely reconfiguring how advertisements are served on the platform's channels. Agencies, ad tech firms and content networks have stepped up in the meantime, offering sturdier whitelisting and guarantees of safer inventory.
The phrase being leveraged most against Google and YouTube, in particular, is "brand safety," but it's far from an issue limited to these platforms, experts said.
"Social platforms in general, including YouTube, should keep a close eye on the content that is shared on their platform because it will be, even if unfairly, perceived as a representation of the platform vs. the person posting,” said Boidock.
"I think that some things are unavoidable and the main takeaway for social platforms is to be hyper-responsive and action-oriented when situations like this arise to minimize the damage they may cause," he added.
Although YouTube is often grouped in with social platforms like Facebook or Snapchat, not all marketers view it as fitting into that category for advertising purposes. Jason Beckerman, CEO and co-founder, Unified, explained that the boycott won't necessarily affect social spend broadly because most advertisers place YouTube ads into their display budgets, given that ads on the video portal are frequently bought through Google's DoubleClick Exchange.
At the same time, Beckerman said he is already seeing a shift, with marketers taking YouTube ad spend to other platforms.
Google's woes are rivals' opportunity
While YouTube is a digital video veteran having arrived so early on the scene, it's seen growing competition from other tech players like Snapchat and Facebook, the latter of which is investing in long-form, premium video more akin to YouTube's content model than something an over-the-top service like Netflix provides. Given that, YouTube's current vulnerability doubles as an opportunity for rivals.
Both Beckerman and Boidock cited upstart Snapchat as a beneficiary of YouTube's struggles; Beckerman also highlighted Facebook and Twitter, while Boidock pointed to Instagram. The common element here is that all of these platforms are rapidly proliferating video ad formats ready for purchase, and have healthy user bases that show a propensity to consume more video content.
Boidock mentioned that more publishers are producing original video content as well, so some YouTube ad dollars might end up on those non-social channels.
"Marketers who decide to reallocate YouTube dollars will focus them on platforms with similar visual/video mediums," said Boidock. "Most of the platforms with that type of content offering fall within social."
However, where video strategy fits into the individual marketer's goals overall will ultimately have the most influence on how any YouTube ad dollars are reallocated.
Boidock said that brands focused on passive consumption, where the user is just expected to watch the video, might turn to digital TV-like channels like AMC.com or Crackle. Marketers looking for active consumption, where users interact with and click on ads, might turn instead to social platforms since their users are accustomed to directly engaging with content.
How will YouTube fare?
In the short term, YouTube and Google are obviously losing a share of ad revenue, but neither Beckerman nor Boidock expect the boycott to be long-lived or especially damaging.
Beckerman sees YouTube addressing the issue through innovation — the company is apparently working on a Cloud Video Intelligence API that uses artificial intelligence to flag down inappropriate material — and marketers moving on to a new topic of discussion. Boidock thinks that, as soon as YouTube tightens up policies around offensive content, advertisers will come running back.
"Fortunately for Alphabet/YouTube/Google, the current situation is a result of other people’s negative content hosted on their site vs. something [Google is] proactively producing," he said.
"The only thing they’re guilty of is creating a platform that erred on the side of minimal censorship/right to free speech," he added. "This means users and advertisers should have a much easier time forgiving them when this is resolved."
One area where Google could find itself in trouble is if the YouTube content creators that capture huge audience attentions decide to switch platforms. Many are already taking a direct hit to their incomes, and some of the most prominent YouTube influencers have, in turn, started to produce content for rival services like Amazon's Twitch.
The controversy overall highlights how social platforms have evolved since they launched with priorities leaning toward the user through ease of access and free speech, according to Boidock. Now that many of these platforms, including Facebook, Snap and Twitter, are publicly traded, they have to meet both the increasingly watchful eye of brands and also shareholder expectation and preferences.
"A brand pulling its advertising can actually cause a ripple effect that influences social policies," Boidock said.
The broad view on social
YouTube’s current issue isn’t likely to impact social media ad spending, said Boidock, citing research that says spend in the category is expected to increase by 26% this year, and one that has doubled globally over the last two years. YouTube might even see a bounce back when marketers return, eager to make up for lost time, he added.
Beckerman took a more philosophical look at the big picture.
“In general, digital is a brave new world," he said. "This will not be the last bump in the road for digital marketers, but like all great pioneers who set a course — that journey is not a straight line.
"You recalibrate when you need to and keep walking forward because the benefit of getting to the end of the journey is much better than not taking the trip at all."