The average American is spending more and more time watching digital video, and the projected increase in digital video ad spend suggests marketers are taking note.
But there’s something that might be preventing advertisers from getting the biggest bang for their buck—so far, video has predominantly been used for brand marketing. Are performance marketers missing out? Nicky Rettke of YouTube’s direct response ads team thinks so. We spoke with her to find out why performance video ads should be a part of every marketer’s toolbox.
Ekaterina Petrova: Many performance marketers have yet to use video in their marketing. Why is that?
Nicky Rettke: One thing we used to hear from performance marketers was that, with video, it was difficult to align budgets with business goals. Historically, video advertising hasn’t been actionable, optimizable, or measurable against direct response objectives. The only way someone could “act” on a video was to watch it. Marketers could only optimize for reach (with TV) or views (with digital video). And tracking hard ROI back to video was just about impossible. That meant performance marketers very rarely considered video as an acquisition tool.
We’ve tracked 100% more conversions globally on YouTube in the past 12 months than the previous 12 months.
What’s changed to make you believe performance video ads can be an effective tool for direct response goals?
The biggest change is in the video formats available. We used to think that when people watched a video, they wanted to lean back and passively consume the content. But our UX research revealed many viewers want a more active experience, so the YouTube platform now provides one, with interactive functionality that allows you to do things like vote on a poll or sign up for something.
That’s great for marketers looking to optimize performance video ads beyond the view. Now, new video formats, like TrueView for action, mean marketers can optimize for a specific user action, like signing up for a service or buying a product.
The second change is that the measurement technology has become much more sophisticated. With cross-device conversion measurement, marketers can not only track conversions from digital video, they can also track them across different screens.
For instance, if someone is watching a video ad on their tablet, and later converts on their mobile, that can be measured. Thanks to this new technology and the fact that consumers are increasingly using video to help make purchase decisions, we’ve tracked 100% more conversions globally on YouTube in the past 12 months than the previous 12 months.1
The beauty of digital video is that marketers can dip their toes in the water before fully committing.
Which brands are doing performance video ads really well?
One that comes straight to mind is Kayak, a travel tool that helps people plan and manage trips.
Each of its direct-response TrueView ads has a prominent call to action next to and at the end of the video, inviting users to “Search Now” and making it easy for them to convert. It pairs that format with target cost-per-acquisition bidding, which has helped cut its cost per incremental travel query by 80%.
It’s also started to use custom intent audience targeting, which basically means it can target its video ads at people who have already been carrying out travel-related searches on Google—a good indication that they're ready to book a trip.
What’s your advice for marketers looking to venture into performance video for the first time?
The beauty of digital video is that marketers can dip their toes in the water before fully committing. They don’t need to invest in an entire video team or a production studio to get started.
If they have TV creative, for example, they can repurpose that for digital with a few tweaks, like mentioning their brand in the first five seconds and appending a call-to-action. Or if they have print ads, they could transform them into six-second bumper ads just by adding motion graphics, like Clinique did recently.
Even if they don’t have existing content to repurpose, there are tools that make producing video ads a relatively light lift. For example, we have a service that connects small businesses with filmmakers to help them develop a 30-second video ad. Another product we’ve rolled out allows you to auto-generate app-install video ads.
Video might look like a complicated and expensive format to pull off, but it doesn’t have to be. Set a budget and a target cost-per-acquisition, and just experiment.