Channel 4 pounces on Google furore with claim that TV VOD is 20% cheaper than ads on YouTube

Channel 4 pounces on YouTube furore with claim that TV VOD yields better ROI than social video ads.

Channel 4 is the latest industry player to question Google's viability as an advertising channel, with a report that claims advertisers are paying more per minute for completed views on YouTube and Facebook despite the viewer being less inclined to watch them compared to broadcaster VOD.

The study concluded that the true cost per thousand (or minute) for broadcaster VOD services such as All 4 is 20% cheaper on YouTube and a third of the cost of Facebook – “even when including organic views”, which make up most of Facebook’s engagement. The higher price point for social video was despite that advertising on broadcaster VOD generates 3.5 times more attention then those on YouTube.

Indeed, it would seem people are noticeably more passive when it comes to ads on social networks compared to VOD, with just half (52%) of YouTube ads being viewed in what researchers called an “attentive state”, compared to over 85% of viewing time of ads on broadcaster VOD. So much so that a large number of people don’t watch the full ad when its on a social network; completed advertising video views are 62% lower for YouTube and over five times lower for Facebook than All 4 ads, the report claimed.

What’s more, for almost half of the time Facebook users were observed they were constantly scrolling with just enough time to scan posts, the study noted. Seven in 10 of those respondents said they actively scroll past video ads.

Amid the current debate round viewbality, the broadcaster’s report suggested that those ads on YouTube and Facebook are less likely to be seen. Three quarters (73%) of minutes spent watching YouTube on tracked devices revealed that the ads and videos were hidden from view due to people using them as “background music play-listing behind other tasks”.

Jonathan Allan, sales director at Channel 4, said: “These research results are compelling and support what we already know to be true – that BVOD is a far more effective and efficient use of brand marketing spend than social media platforms. It’s particularly timely as Google and Facebook face further calls to take responsibility for brand safety and viewing measurement and should give advertisers and agencies much to consider as they evaluate their marketing mix and media investment decisions.”

Allan is referring to the industry’s growing dissatisfaction with YouTube’s attempts to curb ad misplacement that has already seen advertisers including Channel 4 and agencies pull ad spend. It’s created somewhat of a hostile environment for Google since the turn of the year and media owners such as Channel 4 and News Corp have been quick to try and capialitse on those advertiser concerns in order to further their own goals.

The findings are unlikely to surprise many industry observers given how Google’s YouTube has struggled to make a dent in the video ad market for some time. A Thinkbox report from earlier this month found the average person in the UK watched 20 minutes of video advertising a day last year. TV - either live, playback or on a broadcaster’s VOD service - accounted for 93.8% (18 minutes, 53 seconds) of this time spent daily, compared with 94.4% in 2015. YouTube, on the flip side, hosted 0.7% of the video advertising that was viewed. While this was up from 0.5% posted in 2015, it shows how tough the online behemoth has found breaking into the TV ad market.

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