YouTube rolls out new ad model, asks $62m for exclusive package

PanARMENIAN.Net - YouTube is rolling out a new advertising model looking for new ways to monetize the vast amounts of content hosted on the video sharing site.

As The Next Web reports citing a post on AdWeek, Google is offering channel sponsorships – consisting of display, overlay and pre-roll ads – giving advertisers looking for targeted marketing 96 original content channels in various categories to reach their preferred viewership.

Last June, Google revealed that 30% of YouTube’s viewers actually do watch the pre-roll ads, but more importantly than that, a study showed that the viewers who do choose to watch the ads are 75% more engaged on average than users who are subjected to standard ads. With these kinds of figures, it’s not surprising to find that YouTube’s asking price is more in-line with TV advertising prices.

According to AdWeek, the new model could bring in anywhere beween $4 to $6 million per year, per sponsorship of a single channel. Its pre-roll rate comes in higher than the industry average, at $20 CPM.

AdAge revealed pricing for entire packages, saying that YouTube is asking as much as $62 million for a one-year exclusive package in the music and pop culture categories. A package of sports channels would set advertisers back $40 million, and an automative package costs $16 million. A package consisting of ‘Moms’ channels costs $10 million.

YouTube is also offering smaller packages in categories including celebrity news, music and film, and geeks and gadgets, which will cost between $10 and $20 million per sponsor, while according to AdAge a single channel sponsorship would cost between $2 and $4 million per year.

YouTube has already signed on some heavy hitters including Unilever, which will be sponsoring the Young Hollywood Network channel for $10 million.