According to a publication by The Wall Street Journal, approximately 80% of YouTube’s advertisements violate the platform’s terms of service, potentially leading advertisers to demand refunds from Google, the parent company of YouTube.
The crux of the issue lies in the advertising model YouTube employs. Advertisers pay YouTube to display their ads either before or after videos on the platform. However, research by Adalytics suggests that about half of these ads are not actually shown on YouTube. Instead, they are displayed within Google’s “Google Video Partners” (GVP) program, which includes third-party sites other than YouTube.
Google’s terms of service specify that some ads may be shown within the GVP program, promising advertisers a similar experience to that on YouTube, including audio components and the ability for users to skip the ad if they wish. However, Adalytics found that ads on these partner sites are disabled 80% of the time, often play automatically on the side of the screen, are frequently muted, and cannot be skipped. This contradicts Google’s promise of a similar user experience off-platform.
This discrepancy could have significant financial implications. Advertisers typically pay around $100 for every 1,000 views of their ads on third-party sites, expecting high-quality ad placements. However, Adalytics discovered that lower-quality ads, usually sold for just $5 per 1,000 impressions, were often displayed instead. This means that more than half of their advertising budget is spent on displaying lower-quality ads on properties other than YouTube.
Major brands such as Johnson & Johnson, American Express, Samsung, Sephora, Macy’s, Disney, and even government organizations like Medicare, the U.S. Army, the Social Security Administration, and New York municipal agencies have reportedly fallen victim to this poor ad exposure. Their ads have also ended up on websites spreading misinformation and hosting pirated content, contradicting Google’s commitment to display ads only on high-quality, carefully selected sites.
Google has responded to these allegations, stating that the “vast majority” of video advertising campaigns are run on YouTube, not GVP. They also defended the quality and visibility of GVP ads, claiming that over 90% of GVP ads are of higher quality than the industry average. However, this issue remains a thorny one for Google, potentially damaging its reputation among advertisers and causing some to lose faith in Google’s promise of high-quality ad spots.
