Kids Content on YouTube – Where are we now?

Big Picture Takeaways for Brands

YouTube’s recommendation algorithm has had some major shifts since the implementation of the FTC settlement terms on January 7th. As with any algorithmic change, there are winners and losers among the creator community. Over the past six weeks, Clamour has conducted interviews with the creators of over 200 YouTube channels who make content for kids (ranging in size from 50,000 – 10,000,000+ subscribers), as well as many influencer marketing agencies and multi-channel networks. A number of patterns have emerged that we are happy to share.

Channel to channel traffic flow which was previously predictable (viewers of Channel A would typically have Channel B recommended to watch next) has been significantly disrupted. The recommendation algorithm appears more likely to refer audiences to content on larger channels with substantial back catalogs of videos. As a result, traffic is steadily shifting towards mid-sized channels and larger (200k+ subscriber), causing smaller channels to see a significant decrease in growth and overall viewership, experiencing drops in revenue of over 90%.  Much of the anecdotal feedback we received was consistent with this report produced by the data analytics platform Social Blade: https://socialblade.com/blog/made-for-kids-initial-look-at-the-data/

YouTube influencers’ advertising revenue is directly impacted by changes in viewership.  We’ve heard directly from many smaller channels in our network that they are being forced to pivot away from kids content or exit online video creation entirely, due to the lack of sustainability in their businesses.  Most mid to large channels have seen a more modest drop in revenue, 20-30%, in part due to an increase in viewership as traffic consolidates around the top channels. They’ve also reported that their CPMs are steadily improving week over week.

Micro-influencers have been devastated by the drop in viewership and ad revenue

  • Pros:
    • Smaller influencers may be willing to work for lower cost due to the drop in other revenue.
  • Cons:
    • They are harder to find as the algorithm drives search results to larger channels.
    • They are not likely to be able to predict or deliver the viewership or engagement they have in the past.
    • Their business model may be unsustainable and they may not be a long-term business partner. Many small and micro content creators plan to close their businesses in the next few months.
  • Net result: Working with micro and small creators in the past was time intensive, but a good value.  Going forward, they may no longer be worth the time investment needed.  Be sure to look at their viewership trends over time using sites like socialblade.com before committing to a partnership.

Partnerships with Mid to Large Kids Content Creators are a great value

  • Slight drop in AdSense revenue may increase mid- to large creators’ willingness to partner on branded content
  • Due to decreased competition, mid- to large channels are likely to grow quickly resulting in higher rates in the future (by Q4)
  • Influencers are most responsive and flexible with brands they know and like.  As viewership consolidates among the top creators, it’s never been more important to build directly relationships with influencers to develop long-term brand partnerships.

Is it safe for my brand to partner with YouTube Kids-Content Influencers?

The simple answer is “yes”. A broad survey of influencer marketing agencies and influencers shows that brands’ spend and the volume of brand deals have both increased since January’s implementation.  The FTC has stated it will not pursue enforcement against individual creators as a result of this COPPA investigation.  Clamour continues to recommend that brands request proper advertising disclosures in branded content, which have not changed, and review previous content to ensure the channel is a good fit for their brand.

The public response to the FTC’s proposed expansion of the scope of COPPA was overwhelmingly negative, and unmatched by anything in the past 40 years. The last time the FTC received such a response was a reaction to proposed cereal advertising regulation, forcing them to abandon their regulatory efforts. Similarly, in this current case, the over-whelming backlash (close to 1 million comments when typically receiving under 5,000) has resulted in the FTC drastically changing their public messaging from pursuing expansion themselves to calling on Congress to update existing legislation with the input of all stakeholders, including parents, content creators, brands, tech platforms and advocacy groups.

In the past four months, we’ve seen considerable fear mongering and panic among kids content creators and organisations that partner with them. Now that implementation had taken place, it seems that many of these were overstated and the kids influencer marketing ecosystem is stronger than ever.

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