Youtube has just announced the arrival of the shopping function in Shorts, its short video format launched in 2021 to compete TikTok.
Last June, YouTube Shorts already claimed 1.5 billion monthly users, exceeding the billion present on the Chinese application. Despite this, YouTube saw its advertising revenue decline in the third quarter of 2022; the company is therefore looking for other ways to generate profits.
Buy items directly from the Shorts
The platform relies on e-commerce to compensate. From 2023, it will test a shopping feature with pre-selected designers in the United States, with users located in Uncle Sam’s country, Brazil, India, Canada and Australia. Influencers will be able to tag their own products in the Shorts and their viewers will then be able to purchase them.
Revenue from sales will go to creators, YouTube, and product brands. ” It is very much an endorsement model, as opposed to a more traditional advertising model or paid placement model. Our goal is to focus on the best monetization opportunities for creators in the market says Michael Martin, head of YouTube Shopping.
This announcement, in addition to representing a new source of income for YouTube, allows it to push the Shorts even further. As a reminder, the company declared in September that 45% of advertising revenue from short videos would be paid to creators. YouTube clearly does not hesitate to spend in order to stand up to the Chinese application, which has experienced a meteoric rise since its launch.
E-commerce is increasingly interfering with social networks
YouTube is not the only platform to bet on online shopping. Last week, TikTok started testing a similar feature, while a shopping feature has been present on Instagram since 2018. This is an evolving industry, as younger generations develop different consumption habits and switch via social networks to obtain products or discover new ones. The Covid-19 pandemic has amplified this trend.
The phenomenon is such that TikTok is preparing to build order processing centers across the Atlantic, where it would take care of customer service, warehousing and returns itself.
Sources: Engadget, The Verge
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