YouTube's 'Long Tail' Challenge

Did the Alphabet platform miss an opportunity to out-TikTok TikTok?

YouTube is firing on all cylinders, right? After all:

• The Google-owned property pulled in $8.66 billion during its most recent quarter - a jump of 13% year over year.

• It earned $50 billion over the past year.

• It has practically taken over the TV screen - accounting for 12+ percent of viewing

• The platform’s top creators dominate culture among multiple generations.

But…

Does YouTube have a blind spot when it comes to the vaunted ‘long tail’ of smaller advertisers, direct-to-consumer brands, etc. - the kind that fuel Instagram and other social platforms?

Put another way, did YouTube’s push into TV (and quest for TV money) cause it to blow it on social shopping - while ceding that territory to TikTok?

I recently chatted with Vayner Media boss John Terrana at Cannes, and he got me thinking.

When “you look at like the the run-rate of YouTube as an ad platform, it's still two-thirds the size of Instagram,” he said. “YouTube really needs to figure out how it connects to lower funnel and drives business outcomes. I think that's sort of what keeps like a real influx of dollars going from it and that's the advantage of social platforms.”

That surprised me to a degree, since I think of YouTube as a central hub for so much product research, unboxing, and all sorts of affiliate deals. In fact, YouTube was ranked as the top choice for product reviews and product information by all consumers, including millennials and GenZs, per a 2024 Traackr survey in the US,

But of course, the Instagram numbers do stand out in light of YouTube’s ad revenue:

As do TikTok Shop’s numbers, also from eMarketer, “TikTok's wide-ranging efforts to grow its eC_ommerce business drove social commerce gains in 2024. U.S. sales rose 26% this year to $71.62 billion.”

So what gives?

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The thing with YouTube is, it sort of is and isn’t a social network. Commenting, sharing, and interacting with fans are inherent to the platform. But its also largely centered on viewing - either entertainment or informational content. And its range of use cases is just so broad.

That being said, I do have some questions about how its unique nature impacts its business:

-Is it hard for brands to measure outcomes on YouTube compared to other platforms?

-Is it hard for consumers to shop on YouTube?

-Is the fact that so much viewing is happening on TV that makes it a hindrance?

-Should YouTube have pushed social shopping more over the past few years, given how vulnerable TikTok seemed to be politically?

Shamsul Chowdhury, Global EVP of Paid Social at Jellyfish, said that perhaps unintentionally, because Google’s search business has been so successful at catering to the long tail, it has inadvertently kept YouTube from doing the same.

“It boils down to how Google/Alphabet are set up,” he said. “Google is commerce. YouTube is not really viewed as an action platform. You are not looking to be driven off to another site. It sort of came with the territory - here’s where you view video.”

[So as a business] “they’ve been vying for eyeballs,” he added. “I don’t think they’ve ever thought about doing more than that…so let’s not muddy the waters.”

Darren D'Altorio Senior Vice President, Paid Media, Wpromote, agrees that the company divide, and the way execs talk about YouTube, has almost trained performance advertisers that the video site is not for them. “YouTube is an undervalued media property for performance,” he said. Google execs “don’t think about it that way and they should.”

YouTube may need to focus more on catering to performance advertisers with more applicable measurement and ad units. “YouTube has products in this area, but they haven’t centered them,” D'Altorio said. “Where I’ve seen the gap is that ‘branding’ is in their way.”

For example, a metrics tool designed to help some brands track the value of mid-funnel ad campaigns on purchases has been named ‘Demand Gen.’ “That signals to pefrormance brands that it’s not for them.” Yet in his experience, “it’s extremely performant. You just have to use it in the right way.”

Should that be pushing more social shopping experiences? After all, there is a big difference between a platforming directly driving or influencing lots of sales versus being the place those transactions are executed. Look at how many times Meta has tried to make fulfillment happen on Facebook and Instagram. Same for Pinterest.

“Even Meta can’t pull this off,” said Chowdhury. “TikTok has done really well in getting Shops to be a thing.”

In light of how aggressively YouTube responded to TikTok’s overall growth by launching Shorts, maybe the company should have pushed harder in shopping?

Terrana mentioned how crucial TikTok Shop has become for many brands -even if they don’t actually sell much via the vehicle. Just the exposure is huge.

“You see TikTok Shop driving real commercial outcomes for some really big brands,” he said. “And we have some legacy CPG brands who are talking to us about ‘let's be on TikTok Shop’ because…it's not just the commercial outcomes but it's almost like a branding play as well because the units the commerce units show up in feed. It’s just a place where it's almost like if you're not there [it stands out].”

“TikTok is really building a full funnel ecosystem with scaled attention plus integrated commerce and check outs,” he added. “Other platforms have part of this.”

The Ex X Factor

No matter what you thought of Linda Yaccarino’s two-year tenure at Twitter’s CEO, her legacy is secure. Consider that:

• One of her signature achievements was getting a non-profit focused on keeping brands away from hateful content completely shut down.

• After once selling the Olympics, she brought Cheech and Chong’s Gummies business to unforeseen heights

• She singlehandedly launched the industry’s first Sue-Fronts, during which platforms - even if they are sub-scale and toxic, and sue advertisers to get them to spend more annually