Next Big Thing for YouTube: E-Commerce Links

YouTube today announced it has added the option to incorporate e-commerce links from videos on its site to relevant iTunes and Amazon products. The move was expected, as YouTube CEO Chad Hurley described doing exactly that at a talk in June and such links have been out in the wild for a while now.

Honestly this seems like a tiny feature addition, especially since more and more YouTube producers are using its annotations tools to add links to other videos and pages on YouTube directly within a video at the time and place they feel is most relevant. But YouTube is under widespread scrutiny for any shred of evidence that there is indeed money to be made in online video.

At launch, the new click-to-buy retail links are being used by EMI and Universal Music Group for their music videos (see example) and Electronic Arts for its Spore videos (see example). For now the links are extremely unobtrusive (they’re the very bottom thing in the screenshot above), appearing way down below a video’s rating and viewcount and options to share it on MySpace, Facebook, or Digg. That placement is subject to change after testing, according to Bakari Brock, YouTube’s business affairs counsel, who also mentioned further integration such as the ability to click to buy sunglasses that someone was wearing in a video. Off of YouTube, that expanded clickable in-video functionality is already available from lots of people, including TicTacTi, OverlayTV, Asterpix and Delivery Agent.

The click-to-buy product will only be available to select YouTube partners, who must already have their own accounts on iTunes and/or Amazon. It will also be available for those partners to use on videos uploaded by regular users and then claimed for advertising (rather than taken down) as part of YouTube’s Video ID copyright service. However, it won’t be available to regular users to incorporate their affiliate relationships with Amazon, or recommend other products they like. And it will only be available in the U.S.

Alongside the announcement, YouTube shared some details on its other ad formats, which include homepage video ads, InVideo overlay ads, and contests. The company said that overlay ads — which appear at the beginning of a video for 10-15 seconds over the bottom 20 percent of the player window — have click-through rates of eight to 10 times their display ads. Less than 10 percent of users close the overlay ads (though they do go away if you don’t interact with them).