YouTube fills ad revenue gap with new shopping feature

YouTube is reportedly increasing the ways consumers can shop via its videos to increase revenue streams following a slump in digital advertising.

In October, Alphabet – which owns YouTube and Google – saw profits drop by nearly 30 per cent to $13.9 billion as ad revenue from the video-sharing platform declined.

YouTube has introduced a new feature to Shorts which will allow customers to buy products as they watch videos, according to a report by the Financial Times.

The newspaper said that users will be offered different services depending on their geographical location, with users in India, Brazil, Canada and Australia able to shop through Shorts and users in South Korea sold goods through live shopping videos where the service is popular.

Michael Martin, YouTube Shopping’s general manager told the publication that creators will be paid 45 per cent of the revenue made by displaying adverts between videos on Shorts next year. Additionally, the company is piloting affiliate marketing schemes in the US, where creators are given commission when selling products.

YouTube also announced plans to partner with content creators to launch gift guides and special deals.

On its website the company posted a list of over 30 creators who would participate in a series of live streams, shorts and videos throughout November.

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