Marketing on YouTube: Does it really work?

A “Will It Blend?” YouTube clip from Blendtec.

A couple of fascinating essays have raised questions in my mind about the future influence of YouTube.

For those who’ve been living under a rock for the last few years, YouTube is a Web site that allows people — and companies — to post any videos they like for free, short of pornography.

A YouTube strategy has become standard procedure for every marketer: post a video on YouTube and try to get people to watch it. It’s free and sometimes it works great. With roughly 75 million unique visitors a month, YouTube ranks as the third most-trafficked site in the world. What’s not to like?

Very little, from the perspective of marketers. But investors in Google, which owns YouTube, might feel differently.

The problem is that YouTube is losing a lot of money — about $470 million in 2009, according to a report by the investment bank Credit Suisse. That’s not much compared with Google’s market cap of $134 billion, but nearly 500 million clams is still a lot.

In this widely cited article, tech executive Benjamin Wayne gets right to the point: YouTube is doomed unless it finds a way to successfully monetize its vast traffic.

As more people post videos to YouTube, the site has to pay for more bandwidth to transmit them. But the vast majority of YouTube videos are amateur productions that don’t garner big viewer numbers. Still, YouTube is paying for the privilege of hosting them all.

Some successes
I was already thinking about YouTube when I opened the New York Times Magazine yesterday and found this intriguing piece putting YouTube in perspective in light of the Susan Boyle phenomenon.

The “prime directive’ of online video is to be amazing, writes author Virginia Heffernan: “The great subjects of online video are stunts, pranks, violence, gotchas, virtuosity, upsets and transformations.”

There have been some signal successes in YouTube marketing. One that comes to mind is “Will It Blend?” The video series typically gets 3 million or more views for each installment as lab-coated geeks toss items like hockey pucks, iPhones and golf balls into a Blendtec blender. Blendtec credits these videos with helping boost sales 700 percent. They’re every marketer’s wildest dream; watch them here.

But what about marketers who can’t or don’t want to be part of the freak show? If you’re selling industrial pumps, a video may be the perfect way to show your products’ performance to prospective customers. But you shouldn’t expect to get a million YouTube viewers — unless, say, the video shows your pump sucking up and spewing out a cat.

There’s definitely a place for online video in marketing — an important and growing place. But as online marketing matures, it may be that YouTube isn’t that place — or, at least, isn’t the only place.

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