Why YouTube will play a bigger role in some holiday marketing budgets this year
Connor MacDonald, CMO at wallet and accessories brand Ridge, said YouTube was a “top priority” for his brand heading into 2025.
“There are only so many channels that have enough users and powerful enough or effective enough ad engines where you actually can scale to the point where you’re spending tens of thousands of dollars a day,” he said. And for MacDonald, one of those channels was YouTube.
Ridge has upped its YouTube spend by 200% this year, MacDonald said. And, perhaps more importantly, McDonald said, “We had weeks in September where our YouTube spend was greater than our Meta spend, which is basically the first time we’ve ever done that.”
Not every brand is as bullish, but there are signs that more fast-growing, digitally-native brands like Ridge are making YouTube a bigger part of their advertising strategy, especially ahead of the holiday season. Media agency and consultancy January Digital, which has worked with brands like Amika and Kendra Scott, said the number of clients it works with who are actively spending on YouTube has doubled over the past 24 months.
Brand and agency sources said a variety of factors have resulted in more brands embracing YouTube. They include the platform’s improvements to creator monetization; its rollout of an AI-powered campaign type, similar to what Meta and other social platforms offer; decreased barriers to creative generation; and an increased interest in video and television advertising, more generally.
There’s also the desire among brands to diversify their advertising spending away from Meta. It’s an evergreen goal, but one that has taken on more urgency this holiday season as consumer sentiment remains dampened and, according to marketers, customers are taking longer to buy. Brands are hungry for channels where they can reach a lot of new customers cost-effectively, at a scale similar to Meta.
Although it is the second-most visited website in the world, YouTube has historically been a more challenging advertising platform for brands to invest in if they don’t have a firehouse of creative assets well-suited for YouTube videos. “For a long time, there was this mentality of, like, ‘OK, you’ve got to make creative specific for TikTok and creative specific for Meta,’” said Chris Berg, vp at January Digital.
While he said that is generally true, he added, “There are nuances for each [platform]. YouTube is a place where a lot of people spend time, and you have to be there. Even if it’s creative that you’re repurposing from other platforms because of cost limitations and things of that nature, it’s better than not being there.” The release of Shorts, YouTube’s feature designed for short-form vertical videos, has helped. Since Shorts was released in the U.S. in 2021, brands have been more easily able to test out YouTube by repurposing videos from Instagram Reels or TikTok.
But that hasn’t been enough for every brand to ramp up their YouTube spending. Katya Constantine, founder of the agency Digishopgirl Media, said the percentage of her clients that are spending on YouTube has remained roughly the same. Still, she added that, right now, she’s seeing cheaper CPMs on YouTube Shorts compared to Reels. “We’re taking advantage to build that in,” she said. “We’re definitely seeing more of a ramp up [in spending] in October going into November.”
Berg said a lot of his clients are “using September and October to go out and build buzz” through YouTube, as it’s an ideal channel to build brand awareness and use for top-of-funnel marketing.
Max Lishansky, CMO of the apparel and accessories brand Cuyana, said in an email that the company hasn’t advertised on YouTube in around three years, but that it is getting ready to launch YouTube advertising in time for the holidays.
“Our growth strategy is centered on new customer acquisition, particularly reaching out-of-market audiences,” Lishansky wrote. “YouTube gives us a scalable opportunity — especially in the video format, where we can connect with audiences in emotionally resonant, compelling and memorable ways.”
Still, it’s not just a channel that a brand like Cuyana can flip on overnight. “The formula for success on YouTube is quite different from other channels, so [developing] new creative, especially for this channel, is our approach,” Lishansky said. From his perspective, “YouTube requires storytelling that’s created for its unique pacing and audience behavior, so repurposing from other channels doesn’t work.”
There are also certain moments that lend better to storytelling on YouTube than others. Berg said he advises brands ramp up their organic YouTube content to go hand-in-hand with a paid campaign. He also advises brands to think of: “Do you truly have a brand campaign or a campaign that is more than, ‘We just want to be on YouTube’? Do we have a new innovation that we’re trying to launch as a product? Do we have a brand ethos or brand pillars that we’re trying to speak to?”
“I think, if you have those pieces, you can be really successful on YouTube,” he added.
For Ridge, one key piece of the puzzle that has enabled its success on YouTube is its partnership with YouTuber and tech reviewer Marques Brownlee. Ridge named Brownlee, who has more than 20 million subscribers on YouTube, as its chief creative partner last year. Brownlee also joined the board of Ridge.
“He’s extremely notable, and he’s extremely credible. That just naturally makes the ads [that feature him] work a bit better,” MacDonald said. “We [also] ran a sweepstakes in August and early September, where we gave away these crazy cars and $100,000, and that is just a great story to tell on YouTube.”
But like other brands, Ridge also had to spend a significant amount of time ramping up its content. Last year, Ridge spent most of its YouTube budget on Shorts, which allowed it to repurpose content from other short-form video platforms. But this year, Ridge is spending more on in-stream ads, so it had to shoot more horizontal video content.
According to MacDonald, many brands think about measurement incorrectly when they approach YouTube for the first time. They may be wooed by low CPMs and long view times, but, he said, brands also have to keep in mind that, because people are watching long-form videos more intently on YouTube, “they’re clicking at a much lower rate” because they don’t want to be taken away from their video.
“You have to be figuring out: ‘What is the impact of YouTube advertising on our brand search queries? Are we measuring it with geo lift studies? Or, how are we actually trying to figure out the total value we’re generating from the channel?’”
It highlights that the biggest potential in YouTube as a channel lies in its role as a source of television for more people.
“A lot of the conversation has been: ‘How do we treat YouTube like a TV spot?’” Berg said.