Towards Understanding the Consumption of Video-Ads on YouTube

Abstract

Being the most popular online video platform nowadays, YouTube is a complex ecosystem that generates billions of dollars of revenue yearly. This revenue mostly stems from online advertisements that are shown on the website. Like other social media platforms, YouTube enables any user to create and upload content, create ad-campaigns that promote advertisement content, as well as monetize channels (i.e., YouTube video uploaders) by showing ads from other channels to viewers. More importantly, any individual can watch videos for free and, in consequence, be exposed to advertisements. The mediation of these different parties that interact through ads, as well as the YouTube platform itself is done by online ad auction algorithms. In this paper, we study the aforementioned ecosystem through the use of advertisements in the form of video (video-ads). Online video-ads are a novel medium that is gaining significant traction on social media platforms like YouTube. Our study presents insights on (1) the behavior of users when exposed to video-ads; (2) the popularity of the video-ads over time; (3) the relation between contextual advertising and the effectiveness of ads; (4) the success of ads in generating revenue; and, (5) the success of channels in attracting revenue as exposers of ads. The results here presented have practical implications for content providers, creators, channels, and YouTube viewers.