How to scale an ecommerce business using YouTube advertising

YouTube—a perfect blend of social media engagement and Google's search engine features—provides a cost-effective platform for ecommerce brands to add value to every stage of the customer's shopping journey.
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Increased internet prevalence and technological awareness have revolutionised how new-age consumers shop.

Consumers are rapidly switching to online shopping due to the ease, wider choice, competitive pricing, and ad personalisation that tech-backed direct-to-consumer (D2C) ecommerce brands provide.

As per a recent industry report, India has over 800 D2C brands, with the market poised to reach $100 billion by 2025.

D2C marketing is a relatively new concept that has evolved in the past ten years. The major growth drivers of this sector were social media platforms like Facebook and Instagram, which made discovery easier for ecommerce brands to reach end-users directly, eliminating the need for intermediaries.

Brands transitioned to D2C as the cost of acquiring social media ad platforms would be less than what they would have paid to retailers or distributors. However, acquisition costs on Facebook and Instagram have risen dramatically as more brands jump on the D2C bandwagon.

This is where brands need to diversify, and one such heavily underutilised platform among D2C brands is YouTube. 

YouTube provides a cost-effective platform for brands to add value to every stage of the customer's shopping journey and improves their popularity. It is the perfect blend of social media engagement and Google's search engine features.

YouTube's popularity as an advertising platform

The COVID-19 pandemic and consequent lockdowns increased viewership numbers on YouTube.

With a constant thirst for creative content, nearly 25 percent of consumers spend seven or more hours per week watching online videos on YouTube. It has the second-highest monthly active user base among social platforms after Facebook.

According to Google, about 40 percent of viewers used YouTube to compare items, watch reviews, and get suggestions from their favourite influencers, making it a popular advertising channel for brands to reach their target consumers.

Video ads were a complex and tedious task about five to ten years ago, and only brands like ITC, Patanjali, and other FMCG companies were involved.

However, with user-generated content (UGC) and testimonials becoming popular, we no longer require studios to create ad videos. Instead, we can use a smartphone camera to make TikTok-style engaging videos.

Hence, several brands advertise on YouTube using the same ads that would run on television. According to studies, paid YouTube mobile advertising is 84 percent more likely to attract consumer attention than TV ads.

A game-changer for ecommerce

Ecommerce brands must stand out to compete in a constantly evolving consumer market. This is where YouTube advertising comes into the picture. YouTube Shorts captures consumers' attention, and many ecommerce brands use it to distribute attention-grabbing, bite-sized videos to their subscribers and other audiences.

Further, YouTube has rolled out innovative features, including YouTube for Action, discovery ads, and custom intent targeting, to help ecommerce brands reach out to potential customers.

Source: Shutterstock

YouTube for Action

YouTube for Action targets ecommerce brands looking for mid-and bottom-funnel solutions and helps increase sales and awareness.

With video action campaigns, you can convey your brand's story with longer headlines and access top-performing areas like YouTube's home feed, watch page, and Google video partners.

According to Google, video action campaigns can generate 20 percent more conversions (per dollar) than TrueView for Action, making it a cost-effective choice for most advertising budgets.

A shoppable ad feature

Brands can build shopping ads for their stores that allow users to buy the featured products from the video.

YouTube also rolled out feed ads, also called discovery ads, which appear as you scroll down the YouTube feed, similar to the newsfeed and carousel ads seen on the Facebook feed.

Brands like Puma, Urban Outfitters, and Nectar have leveraged YouTube's ad tool. According to industry sources, Urban Outfitters saw a 241 percent increase in click-through rates across campaigns, resulting in a 186 percent rise in sales. About 52 percent of the traffic comprised new customers.

Custom intent targeting

The real game-changer is YouTube's custom intent targeting, where brands can leverage the power of Google. They can capture the search intent from the Google search engine and use it for niche targeting on YouTube via their custom intent segments, helping ecommerce brands to deliver more relevant, useful ads across screens.

How can brands make YouTube ads effective to scale their ecommerce business?

Monitor the performance of YouTube campaigns

Consumers prefer video ads to learn more about brands or items that have piqued their interest. Hence, monitoring performance metrics is critical for measuring the efficacy of your ad campaign.

You can measure it by tracking the increase in the volume of brand search queries. You can also link Google Ads to your YouTube channel and run YouTube campaigns to gain helpful insights on who is watching the ads, how long they are watching, and where you can enhance ad performance.

Focus on creating the right content for YouTube ads

According to a report, consumers are 2.4 times more inclined to view user-generated content as authentic compared to content developed by brands. So, capture the vast user base of YouTube by incorporating influencer and user-generated or testimonial content in your YouTube advertising.

It facilitates interactions between a brand and a consumer, allowing brands to establish credibility and grow. People trust other people. Focus on using user-generated content and testimonials as modern-day word-of-mouth advertising.

Follow YouTube ad guidelines

YouTube ad sizes and specifications play a crucial role in creating effective ads and generating results. For example, landscape mode is perfect for creating YouTube video ads because it displays the largest on the desktop.

Further, mobile visitors can watch the landscape video advertisement in full-screen mode if they turn their phones.

Conclusion

With the increasing craze for video content, harnessing the power of video advertising has become the key to driving growth. YouTube combines the features of a search engine and a social network and offers ecommerce brands a unique platform to reach out to their target audience. So devise a strategy and use YouTube advertising to expand your business and thrive in this digital ecosystem.

Edited by Suman Singh

(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)

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