ARF - Advertising Research Foundation

09/06/2018 | News release | Distributed by Public on 09/06/2018 16:24

The Mating Rituals of Brands and Online Stars

Deals between big brands and viral online video performers, once an informal alternative to traditional celebrity sponsorships, are quickly maturing into a business estimated to reach $10 billion in 2020. As the attention and money paid to stars on sites like YouTube and Instagram balloon, the stakes for both them and the brands to find the right match are rising.

Many popular online personalities built a huge audience by pushing the envelope, providing an edgy contrast to carefully managed mainstream celebrities. They want deals that allow them to keep their style. But when those creators go too far, companies that work with them risk being guilty by association. Felix Kjellberg, better known as PewDiePie, is YouTube's biggest star, with 63 million subscribers to his channel. When he made a series of anti-Semitic jokes in his videos, some companies that had worked with him, like Nissan, severed their relationship.

On the other hand, the video creators cannot do anything that betrays what their fans have come to expect. 'Some creators have viewership that rivals TV networks and a direct connection with viewers that is unlike anything the advertising or entertainment world has ever seen,' said Zach Blume, partner at Portal A, a San Francisco firm making videos for creators and advertisers.

One challenge, both creators and brands say, is that sponsored videos can't appear to be what they are: advertisements. The YouTube generation has learned to tune out ads - when they don't skip them altogether - so anything that carries the whiff of a traditional commercial often falls flat.

The Federal Trade Commission requires that creators disclose when a piece of content is paid for. For YouTube videos, many creators overlay text with 'sponsored by' at the beginning of the video and then use '#ad' in the description to eliminate ambiguity.

Source: Wakabayashi, D. (2018, July 15). Inside the Mating Rituals of Brands and Online Stars. The New York Times.