The times they are a-changin’: YouTube’s monopoly over kids content is finished

The Drum 19 Mar 2020 10:30
By Ramsey Marwan-19 March 2020 10:30am

The marketing sector can be a complicated place as new marketing tools and techniques are launched, almost on a weekly basis. Powered by The Drum Network, this regular column invites The Drum Network's members to demystify the marketing trade and offer expert insight and opinion on what is happening in the marketing industry today that can help your business tomorrow.

FX Digital question whether YouTube's time creating content for children is over.

In early January 2020, YouTube introduced the policy changes that every children's content creator had been dreading. The changes - which were announced back in September 2019 - aim to better comply with the US Federal Trade Commission (FTC) who found that YouTube was in violation of the Children’s Online Privacy Protection Act (COPPA).

YouTube has finally agreed to play ball and comply with the FTC’s regulations, however the new rules have left children’s content creators reeling, with many brands reporting that revenues are down by up to 50%.

The FTC:1; Youtube: 0

YouTube harvested information from child-directed channels on its platform and used this information to serve targeted adverts, violating the terms of COPPA.

This landmark rule change has been heralded for safe-guarding children’s data and parents everywhere will certainly be happy to know that there is more protection in place.

The knock-on impact is that kid’s brands and children’s content creators are losing revenue as personalised ads, comments, click-through info cards, end screens and other features have all been disabled on content aimed at children.

Children’s content brands are in greater need of new revenue streams now more than ever. Ultimately, many content creators are now looking to create their own OTT applications, to take control of how they serve their content to their audience.

The benefits of an AVOD OTT application

Not only do content creators with their own apps keep a lion’s share of ad revenue, but they also have much greater control over the adverts that are served to their customers. For brands serving up content aimed at children, this allows content creators to serve more relevant, contextualised ads and also ensure that no inappropriate adverts are served to their audience.

Brands utilising this option, of course, have to ensure they are not collecting children’s personal data and comply with the FTC and COPPA/the EU and GDPR-K.

Alternatively, brands can go ad-free with a subscription style service (like Netflix). SVOD is becoming more and more popular, with dedicated fan bases willing to pay a monthly fee to gain access to full content catalogues, bonus content and exclusive releases.

If a brand can tap into their key target audiences, they can stand to gain great financial benefits from this approach. SVOD platforms allow for branded experiences which are great for user retention and brand awareness, whereas brands that host their content on YouTube can find their brand overshadowed by the YouTube brand. This also leads to brand association with YouTube when things go wrong (see the FTC issue above!).

Is YouTube’s dominance coming to an end?

However, if brands really want to take control of how their content is delivered, they will need to look outside of YouTube for new revenue streams. The two are not mutually exclusive - brands can keep their content on YouTube Kids and still create their own branded OTT experience, as long as the branded OTT experience provides extra benefits (such as those mentioned above).

Ramsey Marwan, marketing manager at FX Digital.

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