Google’s move to further monetize its YouTube platform via the introduction of channel sponsorships for advertisers seeking select markets should be a great boon for sports teams as it will continue the evolution of the video sharing site into an established network for sports fans.
It seems like a no-brainer for companies that are developing products, sports related or not, that target the demographics that follow sports. It is obvious from recent events such as ESPN expanding its NFL coverage year round that football interest is now high all year. For New Balance or Under Armour grabbing a channel can mean a huge number of views at a fraction of the cost of an ad during an actual NFL game.
The use of YouTube as a de facto network is increasing and to be able to tack your name onto a channel can be a coup, especially if a rival is paying for the exclusive rights to the sports to a league that is related to that channel.
The basics of the program are simply. It will offer channel sponsorships to advertisers who can use display, overlay and pre-roll ads in the targeted markets. This enables them to have a very targeted approach for their efforts, and dollars, according to an article in Ad Week
Ad Age breaks down what the costs will be, and mentions a number of the types of channels that will be getting sponsorships, as well as some of the initial sponsors that have signed on. It claims that so far only minor deals in the $5 million to $10 million range have been signed, but that they are expected to reach $62 million for what it sees as premium content.
So far it has a few sponsors including Unilever, Toyota, and more interesting to sports fans is GM, which has signed on to sponsor Red Bull’s action sports channels, among others. It looks like YouTube will only place a percentage of the ads in a sponsored channel and the rest will be spread around its various channels.
Expect to see a growth in channels in an area like sports as YouTube appears to be breaking the major verticals down into smaller subcategories in order to maximize its ability to sell sponsorships. It is already offering a package of sports channels for $40 million with Music and pop culture being offered at $62 million apiece, per year.
This strikes me as smart thinking for a range of issues. Fans are increasingly filming short bits from events and the ability to see different angles than that which are broadcast is always interesting. Already using YouTube to follow a team or sport, you will probably be able to get push alerts in the future about new video from the sponsors when they are posted rather than constantly checking in to see what is new.
