At Rs 1.4 crore a day, YouTube pitches new eye-popping masthead rate

YouTube's current masthead ad rate of Rs 72 lakh is expected to be doubled as part of the latest revision

by Venkata Susmita Biswas
Published - Aug 28, 2018 9:00 AM Updated: Aug 28, 2018 9:00 AM

Displaying an ad on the YouTube masthead could cost as much as Rs 1.4 crore per day starting January 2019. Google’s video streaming site, YouTube, has approached several digital media planners with a revision of its ad rates. An ad that costs Rs 72 lakh today, might cost double from the beginning of the new year.

This is the second revision of the rate in the year. According to sources, YouTube revised rates around April this year, increasing the masthead ad cost from Rs 40-46 lakh to Rs 72 lakh. This latest revision might put the YouTube masthead ad in the league of an all-edition newspaper front-page ad.

Multiple digital media buyers confirmed to exchange4media that YouTube sent out official communication regarding the ad rate revision two weeks ago. However, when exchange4media reached out to Google India for a comment, the company said it does not comment on the pricing of its ad inventory.

Talking about the new rate, a digital media buyer said, “YouTube has initiated a revision in costing because of an increase in impressions driven by the cheap data revolution.”

A digital media agency executive noted that the YouTube masthead ad garners as much as 900+ million impressions (taking into account that one person may see it around seven times a day). “No other platform can come close to delivering that many impressions within 24 hours,” said another senior media executive.
Everyone who visits the YouTube homepage is served the masthead ad. “That means many might even click on it by default,” the executive added.

YouTube reaches as much as 80% of India’s internet population. In March, Rajan Anandan, Vice-President, South East Asia and India, Google, said YouTube India has 225 million MAUs (monthly active users).

While the revised ad rate seems huge, some digital media buyers say they would recommend their clients to go for the Rs 1.4 crore  masthead if the brand is looking for a high-impact campaign. An investment of this scale may not be for all brands. “If a mass brand is looking for a one-day burst, the YouTube masthead makes complete sense. But I would not recommend this to a niche brand,” said a media buyer.

One digital media buyer said that she would not mind YouTube doubling the rate. “The CPM for 900+ million impressions at Rs 1.4 crore comes to around Rs 15, which is still lower than other digital platforms,” she said. For the best use of ad monies, media buyers aim for CPMs of Rs 12-22 for a campaign.

However, not all digital media buyers are convinced by the upcoming revision. “When the masthead was priced around Rs 40 lakh, we thought it was high, but we accepted it because of the reach of YouTube,” said a digital media buyer. As of now, the masthead on YouTube is sold out until the end of the year.

Some media planners hinted that this could be the first quote and that following negotiations, YouTube may eventually settle on a lesser price.

The head of an independent digital media buying agency said Rs 50 lakh per day was a figure he could easily recommend to his clients, but he would not be asking them to shell out anything in the vicinity of Rs 1 crore per day.

He also noted that though a prime property, YouTube’s masthead is generally deeply discounted as well. “It is not necessary that the spot will be sold at such a high rate. They generally offer a discount,” he said.

But he is worried that even after a discount, the masthead may remain out of bounds for most advertisers. “Even if they offer a 30% discount, the cost would be around Rs 1 crore. And I will find it hard to recommend this spot to my clients,” he said.

Attributing the eye-popping figure to the digital revolution initiated by cheap data and high video consumption, one media buyer said, “This might also be a way to persuade media buyers to buy inventory in advance for next year at the current rate.”
He is hopeful that this preliminary figure might be discounted upon later.

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