Can YouTube Make Money From YouTubers Advertising on YouTube?

Google generated $36.531 billion (with a “b”) in advertising revenue in 2012. The majority of that advertising revenue came from Google Adwords, the company’s main advertising product that allows any individual with an internet connection, a Google account, a means of payment, and a few minutes to spare the opportunity to advertise his or her product or services in a variety of ways across Google search results and targeted sites within the Adwords program.

Adwords is obviously an incredibly successful product. And Google hopes to make it more successful (and up that $36.531 billion figure) with the introduction of AdWords for Video.

The new advertising platform takes advantage of the current technological environment, in which all the tools of content production are democratized and small and medium-sized businesses have a substantial aggregate appetite to market themselves by way of new, effective, efficient, and innovative methods.

AdWords for Video lets individuals with a video to share, an internet connection, a Google account, a means of payment, and a few minutes to spare the opportunity to advertise his or her video to a variety of highly targeted audiences on YouTube. The advertised video will appear as a TrueView in-display ad on YouTube pages with related content and a TrueView in-stream ad before related videos. And, in accordance with the TrueView system, AdWords will only charge the advertiser when a viewer actually watches (and doesn’t skip) the video.

But that’s old news. Google and YouTube launched AdWords for Video back in April of this year. What isn’t old news is YouTube released a new feature that will make it stupid easy for anyone to promote his or her videos by way of the two-month-old product.

Now, YouTube users can turn any of their uploaded video into an advertisement in literally a matter of seconds through  their YouTube Video Manager. The YouTube Creators blog goes through the step-by-step process of how it’s done (as well as gives an example of how Mike Chang built up a subscriber base 500,000 people strong by way of AdWords for Video and washboard abs).

The feature may seem like a minor tweak to how individuals can employ AdWords for Video, but the results could ad up to some not-so-insignificant revenues.

Let’s use YouTube Partners as a sample set (because they get a cut of YouTube ad revenue and are the ones most incentivized to explore different ways to up their viewcounts). There are currently over 30,000 YouTubers in the program. If each of those Partners spends an average of $10 per month on advertising thanks to YouTube making it so simple to do so, that factors out to somewhere in the ballpark of $3.6 million.

That’s a moderate chunk of extra change! Of course it’s only 0.01% of Google’s total advertising revenue (and around 0.36% of one YouTube’s revenue in 2012 according to one financier’s projections), but it’s also just the beginning.

If you plan to use Google AdWords for video, let us know! We’d love to hear how you do.