YouTube ad rates head south

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The Coronavirus pandemic that has turned the global business scenario topsy-turvy, has deeply impacted the advertisement rates on YouTube.

The irony is that this drastic fall in ad rates has come on the back of the surge in viewership on the platform by around 15%.

"Both have been, in a sense, predictable turn of events," says Radhika Bhavesh, a  Mumbai-based digital media advisor. "With people confined to their places, YouTube viewership, like it has for OTT platforms and television, was always going to see a high during the lockdown. But with companies and media buyers pausing their advertising budgets the ad rates were always going to take hit. All campaigns are being held over."

The word from the industry is that the rates have fallen as much as by 50% from the start of March and around 70% of the ad buyers have stopped or paused their plans in the same period. 

Another media advisor, on conditions of anonymity, says these are only ball-park figures as collating information has been difficult. "Our fear is that the fall in ad rates would be even more drastic," he adds.

YouTubers are already seeking a higher cut of revenue temporarily. The cost per mille (CPM), which is basically the money YouTube receives for every 1,000 views of an advertisement in a video, is said to have come down as high as by 50%. The way it works is: YouTube keeps 45% of the money for itself, and gives 55% to creators, who are now demanding a higher share at least for the time being.

The pandemic has had a major impact on all kinds of media. But media insiders confirm that it is the print publications that have suffered the most, both in terms of readership and ad revenues. As mobility and delivery have been hit, the print has borne the brunt of the problem.

The general belief is that TV media may be slightly better off than platforms like YouTube as advertisers are known to play safe in times of crisis and TV is seen as a more trusted and bankable vehicle for ads in these troubled times.