YouTube Advertising Trends for 2023

January 3, 2024
YouTube symbol in the middle of a dark blue gradient background

YouTube advertising is a powerful tool for marketers to leverage as it continues to improve and evolve. In fact, research has shown that YouTube mobile ads are 84% more likely to grab consumers’ attention than regular TV ads.

YouTube advertising has become a popular and effective way for businesses to reach their target audience. Its presence is massive, reaching adult consumers on a global scale. Specifically, 2.065 billion people or 36.8% of all people in the world over the age of 18.

In addition, advertisers can use YouTube’s targeted advertising feature to show their ads to specific demographics, interests, behaviors, and locations. The platform also offers a variety of ad formats, including skippable ads, non-skippable ads, bumper ads, and sponsored ads, enabling businesses to choose the format that best suits their campaign goals.

People spend a lot of time on YouTube watching and engaging with videos, making it an ideal platform for businesses to create highly engaging ads. YouTube provides advertisers with data and metrics to measure the effectiveness of their ads, allowing them to make data-driven decisions and optimize their campaigns for better results. All of these factors make YouTube advertising a compelling choice for businesses looking to connect with their target audience in a meaningful way.

With that in mind, what are some of the developments and trends in advertising on YouTube? Let’s take a look at 3 trends that we think will be important drivers for running successful campaigns on YouTube.

YouTube advertising trends

1. Shoppable ads

YouTube is a huge source of inspiration for consumers, with 63% of viewers saying they bought from a brand because they saw it on YouTube. Shoppable videos can bridge the gap between discovery and purchase by providing a direct path to purchase. Overall, advertisers who added a product feed to make their ad ‘shoppable’ saw over 60% more conversions at a lower cost. Globally, the market for social commerce is expected to grow to more than $2tn by 2025 according to McKinsey.

Shoppable YouTube ads are a type of advertising format that allows advertisers to showcase their products or services within a YouTube video and enable viewers to purchase those products or services directly from the ad.

With shoppable ads, advertisers can add interactive elements to their YouTube ads, such as product images, descriptions, and prices. Viewers can then click on the products within the ad to learn more information and, if interested, purchase the product directly through the ad.

Shoppable ads provide a more seamless shopping experience for viewers, as they can make purchases without having to leave the YouTube platform. Additionally, shoppable ads give advertisers a new way to drive sales directly from their YouTube videos.

Image source: Google Ads & Commerce Blog

Image source: Google Ads & Commerce Blog

The goal of shoppable ads is to create a seamless shopping experience for viewers and drive more sales for advertisers. With shoppable YouTube ads, viewers can learn about and purchase products without leaving the platform, making the process more convenient and streamlined.

If your business is more reliant on lead generation, you can add lead forms to your videos instead. Without interrupting the viewing experience, lead forms help advertisers capture qualified leads while reducing costs. See the example below of the car brand Jeep.

Image source: Google Ads & Commerce Blog

Image source: Google Ads & Commerce Blog

With this campaign, Jeep saw a 13-fold increase in lead completions and an 84% reduction in cost per lead.

Overall, shoppable YouTube ads are a powerful tool for e-commerce businesses looking to showcase their products in an engaging way and drive sales or leads directly from their YouTube ads.

2. Connected TV ads

Connected TV is a popular trend on YouTube that is gaining users each year. In 2023, streaming YouTube videos on a TV screen is expected to grow even more, with 36.4% of 2022 views coming from connected TVs, and that number is expected to reach nearly 40% by 2024 as more people get TVs that can connect to the internet.

YouTube-connected TV refers to the ability to access the YouTube platform through Internet-enabled devices connected to a TV. This includes devices such as smart TVs, game consoles, streaming media players, and set-top boxes that allow users to browse and watch YouTube content on their TV screens.

YouTube Connected TV apps are designed to provide an experience optimized for larger screens, with features such as larger thumbnails and simplified navigation. Some devices may also support features like voice control or personalized recommendations.

In general, YouTube Connected TV allows users to access YouTube content on a larger screen with a more enjoyable viewing experience.

Image source: Adweek
Image source: Adweek

YouTube is taking advantage of this trend by allowing advertisers to track the devices on which their videos are being viewed, allowing for targeted ad campaigns. For example, you can create awareness campaigns for connected TV viewers and more conversion-oriented ads for mobile device users.

The interesting thing about YouTube on TV is that viewers are still exhibiting old-school TV behavior. Advertisements have a 20% higher completion rate than on other devices, the content watched is longer, and there are more co-viewers. Read more about this in our previous article here.

Inflation continues to affect the economy, with higher food and electricity prices. Marketers can no longer ignore the reality of a limited TV market, resulting in higher TV ad prices. The trend of high demand and limited supply will continue in 2023.

3. YouTube Shorts ads

YouTube Shorts are watched by a lot of people, 1,5 billion logged in people per month to be exact. What’s more, Shorts still seem to be growing. Google recently announced that it has surpassed more than 50 billion daily views, which is 66% more than the 30 billion daily views reported in February last year.

Shorts are still relatively new, but they have quickly become very important to the platform. YouTube knows it needs to offer a good alternative to TikTok, so it’s investing heavily in its own competitor: Shorts. The platform is trying to attract more creators by offering ad revenue and diversifying their content; many existing (old school) YouTubers have started producing shorts alongside their regular videos. With more creators producing quality content, viewership is expected to grow.

In May 2022, ads for Shorts were introduced, appearing between Shorts in the user’s feed and are instantly swipeable (skippable). Just like TikTok, Shorts are in a vertical video format, so the majority of viewers (70%) use mobile devices to watch Shorts.

This gives an interesting insight into the advertising possibilities for Shorts, you have to keep in mind that the majority of people will interact with your ad on a mobile device. For example, if you want to run a conversion-based strategy with shoppable ads, you need to focus heavily on a seamless mobile experience. Many brands will use this mobile audience to promote their smartphone apps that are easy to install via the shoppable ads feature and thus do not close the YouTube app.

YouTube shorts ad

So how effective is advertising on Youtube Shorts? Creatopy ran a test where it compared advertising the same campaign on different platforms, these included YouTube Short, Instagram Reels, TikTok and Pinterest.

The YouTube Shorts format proved to be a success, bringing the most traffic and emerging as the clear winner of the case study. Even though the quality of the traffic was not the highest, it was still one of the best performers in that area. You can find the full case study here.

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