Virtual monopoly gives YouTube giant sway over marketing strategies

There's no real alternative to YouTube.

It's a titan in the online video space, and it has a commanding role in the marketing strategies of automakers and dealers.

Its importance was magnified last month when the Google-owned video service temporarily shut down the accounts of nearly a dozen dealerships without much warning. Google reversed the action after a few days, citing a mistake. But those days of isolation and confusion left some dealers wondering if they could still trust the video giant.

The answer: They don't have much choice. After all, YouTube is the second-largest search engine on the web.

And the largest is Google itself.

YouTube's value as a consumer research tool is hard to duplicate. The site provides a central location where dealers can post their videos and distribute them throughout the web thanks to the site's versatile video format, which allows content to be easily shared anywhere -- including on social media rivals Facebook and Twitter, which are both stepping up their own video offerings.

YouTube's arcane terms of service can confound dealers at times, but that's the price they must pay to be in front of shoppers who are actively searching videos for vehicle information.

Does YouTube have a direct rival?

The answer isn't clear-cut, because YouTube now plays in a variety of areas, the company says. The site owns the video-search space and has bolstered its offerings to include interactive 360-degree videos and live streaming, which puts it on the turf of Facebook and Twitter.

Meanwhile, the debut of the YouTube TV streaming service in select markets challenges cable companies along with services such as Hulu and Netflix. YouTube TV streams a diverse mix of cable networks for $35 a month.

"I don't think YouTube fits in a gray box to be honest," Guy Schueller, Google's industry director for automotive, told Automotive News at the company's office in suburban Detroit. "We can find unique audiences for you with the signals we have, both across search and YouTube [and] we can help automotive brands locate shoppers. ... Video has been one of the highest-rising influencers in the shopping process."

YouTube's unique value proposition makes it appealing to dealers. People browse the site with a specific mindset, which gives YouTube an advantage over other platforms, says Brad Paschal, former e-commerce director of Street Auto Group in Amarillo, Texas. 

YouTube users come to the site with the intent to search for and view video content, Paschal said. Facebook users, by contrast, peruse the site to see what their friends are up to and just happen to run across a video that someone posted. 

Paschal says this difference makes it difficult to consider other social networks direct competitors in video. 

"The content only has so much space on Facebook," said Paschal, who's now a Texas dealer advocate for digital marketing company LotLinx. "If it doesn't show up in your [newsfeed], there's a low possibility you're going to see it." 

He added, "If they were direct competition, Facebook would build out a [search] platform similar to YouTube." Facebook's videos are "searchable now, but [the site would need to] have a better platform" to compete with YouTube. 

YouTube searches are increasingly becoming a window into dwindling brand loyalty among consumers, says Scott Fletcher, co-founder of agency Tier10, which handles regional work for the Northern Ohio Honda Dealers Association. 

Fletcher said more people are searching comparison videos, such as "Accord vs. Camry." He said his agency targets people who have searched for certain keywords on YouTube with preroll ads. 

But when it comes to targeting capabilities, Fletcher says Facebook has the edge. His agency can funnel ads on the network to consumers based on make, model, segment and model year. 

"They have all the Polk [registration] data in there. ... I can sit there and target, if I'm a Honda dealer, everyone [in an area] who drives a Honda sedan [that is] two and three years old. And I know that 75 percent of them are coming off lease. I can't do that on YouTube." 

Dealerships that run into issues on YouTube will often need a helping hand from their agencies. 

If a store is looking to get a suspended channel restored, for instance, its best bet is to have their agency reach out to the site to get problems rectified.

Meanwhile, stores -- if they have their AdWords account numbers handy -- can call 866-2GOOGLE on their own to handle "billing problems, one-time account questions or issues" with a live representative. 

Google recommends that stores work through their agencies. 

"We can pick up the phone and talk to our rep at Google, YouTube and Facebook and point out some things," said Alexi Venneri, CEO of the agency Digital Air Strike. "We've been able to get some accounts back." 

She added, "Because we do work with 3,000 dealers, they do listen to us and give us a little bit more attention. It's not necessarily fair, but just like anything, they're in the business to make money. They've only got so many people and resources." 

Kurt Schiele, owner of Toyota, BMW and Jaguar stores in suburban Chicago, said the YouTube accounts for his stores were shut down for a few days last month, and then turned back on with only the vaguest of explanations. Luckily, Toyota's agency Saatchi & Saatchi, in an effort to get things resolved, reached out to Google after being alerted by dealers about several shuttered accounts. 

The company is dealing with a perception among some dealers that it's hard to communicate with. 

"I don't think Google would ever apologize to anybody" for the shutdown, Schiele said. 

"It's a machine. I don't think machines apologize."