Google and YouTube are simply too big for advertisers to boycott

YouTube’s recent spate of bad headlines won’t hurt its bottom line.

The video site is facing yet another advertiser exodus after the Times of London revealed that big-brand commercials were appearing alongside content that sexualizes children. The news comes months after ads on terrorist and hate group videos spurred a similar boycott spanning hundreds of major businesses.

And that's not all. YouTube has also been under fire for hosting disturbing content that found its way into the YouTube Kids platform, as well as videos that show child abuse.

This all might sound like a disaster for YouTube-parent Google, and, public-relations-wise, it is. But like the earlier advertiser flight, it will have negligible financial impact on the company.

In that respect, Google and YouTube are simply too big to fail.

Consider a few of the biggest brands that opted to freeze ad spending on YouTube this week: Mars candy, Adidas, and Hewlitt-Packard. They’ve spent $6.9 million, $7.9 million, and $1.7 million respectively on the platform in the past year, according to data from research firm Pathmatics reported in AdAge.

That’s peanuts to the $252 million Google netted from YouTube’s desktop site since September alone, the firm says.

The search giant had a much bigger backlash on its hands this spring. That boycott encompassed some of the world’s biggest consumer advertisers like Procter & Gamble, Verizon, and Johnson & Johnson. More than 250 companies joined, all told.

Even that crisis failed to make a dent on the company’s balance sheet, though. Many of those businesses are back now and revenue from the platform continues to power Google’s growth.

Google has nevertheless deleted 150,000 of the offending videos this week and removed ads from 2 million more. It once again promised to double down on policing the billions of hours of user video that pours onto its site every day.

“Content that endangers children is abhorrent and unacceptable to us,” a Google spokesperson told Vice News.

The company has indeed cracked down on questionable ad placements in the months since the first boycott, though some video creators have complained that its policies haven’t been applied even-handedly.

It would also seem that YouTube hasn't been terribly proactive on this. The company has been developing artificial intelligence that has helped crack down on extremist videos on the platform, but other issues are only addressed once they make headlines.

The whole debacle has fed mounting fears among marketers that big digital platforms have grown too powerful for their liking. Tensions between Google and Facebook, which hold a duopoly over the digital ad industry, and the advertisers that patronize them have come to a head in recent months. Marketers have become more vocal over a variety issues including the black-box means by which their ads are measured, rampant fraud, and failures to guarantee ads will appear in a respectable environment.

Brands have come to the conclusion that the only way to hold any sort of leverage is to join forces.

"The days of giving digital a pass are over," Marc Pritchard, marketing chief of the world’s biggest advertiser, P&G, said in January. "It's time to grow up. It's time for action."

Pritchard also issued an ultimatum: Digital ad sellers must accredit their measurement techniques with the third-party Media Ratings Council by the end of the year or face a loss of business.

With one month remaining, though, the biggest platforms haven’t done much to meet those demands. And no other marketers have followed Pritchard’s lead on the deadline.

Still, Pritchard claims that his threat has had an effect. He blames the lack of action on the accreditation agency’s limited capacity to audit companies.

“We’ve already voted with our dollars and we’ll continue to do so,” he said on stage at a recent industry conference. “We’ve made tremendous progress.”

But incidents like these show the limitations of those votes. Brand boycotts might be enough to push YouTube to take relatively painless steps to appease PR concerns. But it has much less financial incentive to act if anything more substantial is on the line.