How YouTube built the creator economy and how brands are still missing out - Pedro Pina, YouTube

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0:38All right, without further ado, let's go on with the show. Ladies and gentlemen, welcome back to Uncensored CMO. This is recorded all the way from YouTube Creator Club in Cannes. I'm joined by the incredible Pedro Pina. He runs YouTube for Europe. So I'm testing him out on all the things he knows about how to be a success on YouTube, what brands don't know about being successful, how to work with creators. And we've got a new report here from Little Dot Studios called the YouTube Confidence Gap, full of really interesting insight and information about how to win on YouTube. So if you want to be a success on YouTube, and most of you do because I know that from the report, this is the episode for you.

1:17Now, one tip Pedro gave me in this episode is get people to subscribe. So, ladies and gentlemen, here we go. Please hit the subscribe button and never miss an episode again. Thank you, and let's go.

1:35Welcome to the show, Pedro.

1:36Pedro Pina:Thank you for having me. Delighted to be here. We've got to talk about this set, man, because this is like we are inside YouTube now. I know. We built this for the first time at CanLions because we wanted to bring to a physical space the evidence that creators are now becoming a major force in media. We have about 600 creators roaming through CanLions, so we wanted to give them a home. We wanted to give them a physical home at CanLions the same way we are giving them a home in the digital space. And this is a trend that is becoming bigger and bigger. Last year when we were here, we did not have this setup.

2:13Pedro Pina:And we had so many YouTubers reaching out to us saying, hey, where can we hang out? Can we have time to sit down? Can we have time to meet each other? Can we have time to meet advertisers? And we have the Google Beach setup, which was amazing. But it was too expensive, too big, too dispersed. So we just said, okay, let's find a corner and give them a proper home. and we're delighted. It's the first year we're going to do this. It's going really well. I mean, this is day one and a half. And so far it's going great. And I've already seen lots of content out there. Yeah, yeah, yeah. This is the thing, of course, creators don't wait seven days to produce something.

2:53I know, I know. It's like done in the next few minutes, isn't it? Like you, you're a YouTuber.

2:56Pedro Pina:You are producing on the look of this. Exactly, I know. Well, this is a dream for me because me and producer James can turn up and use your studio. Okay, you need to leave now. Yes, exactly. Now, how long have you been coming to Cannes? Because one of the interesting things about... You're going to age me, aren't you? I've been coming for about 20 years, maybe. And Cannes has changed dramatically, has gone through phases. So when I started coming to Cannes, I was working on the advertising industry. And it was all about the creative agencies. Creative agencies were the heroes of the place. They came here to just celebrate their creativity.

3:37Pedro Pina:It was all about winning lions and who won more lions and the ranking of lions and who got the best campaigns and the best. And at a time was traditional media format led prizes. So it was the TV, the 60 seconds, the 30 seconds, and then the outdoor and then the radio. And then things evolved, but it was all about the creative directors, the creative teams, and the best ideas. Then there was a second phase, which was about media. And as digital exploded, it turned out that it was not anymore about interrupting your life with advertising, but it was all about media. So as the attention of consumers started diverting and changing, so did the beach and so did CanLion.

4:31Pedro Pina:So all of a sudden, the media companies started arriving. You could see first the traditional media rising, and then so the media agencies rising. And then you could see the digital players arriving. So at that time, Facebook, today Meta, then Google, and many others started arriving and they became the talk of the town. And then the big question is, how are you present in the digital space? So how are you at Google or YouTube or at a time, Facebook or Instagram? There was the heydays of that moment. And then it diverted into a data craze. So I remember when it was all about data. So there was a phase where the Accentures and the BBMs and the EYs and all this, the consulting companies were moving in and they were taking over the whole media space.

5:21Pedro Pina:That was at that phase. And funny enough, this is now a coming back home kind of moment, I feel, with back to creativity. It turns out that you can have the best media strategy in the world and you can and you do because today technology allows you to do that. So when you figure that out, at the end, what matters is creativity. But now it comes from the hands of creators. So this is now the new phase. So it's back to the creativity, but it comes back to Ken Lyons through the hands and the eyes and the work of YouTubers and influencers, which really are now the new talk of the town. Hence this.

6:07Pedro Pina:So it's very funny how there's a cycle closing, I think. And it's really, really interesting. And the difference, you mentioned 600 creators. I just wonder how many people are paid creators on YouTube because you're creating an entire economy. We did. So two years after we launched, we came up with this crazy idea at that time. People were finding it bizarre, which was to revenue share our revenue with creators. We said, all right, well, you clearly are producing. This is two years after launch. So we're talking about 20 years ago or 18 years ago in this case. We would say, okay, well, you produce an amazing, amazing video.

6:48Pedro Pina:If you have a ton of audience, you're going to attract advertisers. And guess what? You keep 55 % of what we make. And with 45%, we pay our platform, the costs of global reach, the costs of technology readiness, cybersecurity, the whole nine yards. And you keep 55%. And this was a novel idea. And no one ever did this. And this, by the way, this business model is a video by video kind of thing. It's not as if we keep the money and then we check it out and then we give you whatever we think you deserve. It was literally video by video that goes through your YouTube channel. So it started like that.

7:24Pedro Pina:And, you know, 20 years later, here we are. We have distributed already$100 billion to creators around the world. We have about$3 million making money out on YouTube. and this is to a point where a lot of people make full living out of it. They pay their own salaries to their own teams. They build their own studios. They become their own enterprises to a point where they're having impact on the economies where they operate. So in fact, we run pieces of research in lots of countries where we operate, where we actually can compute how much wealth is being created and impacted on local GDP, how much full-time employment is being created by the creator economy.

8:10Pedro Pina:So it's a full-blown new economy that was created out of, quite frankly, out of YouTube. And the crazy thing about that is anybody watching, listening to this with a phone can do this. And also the revenue share is absolutely, I mean, I do it on my channel as well. And it's a bit of a surprise you get this sort of predicted revenue graph that comes in each month. Oh, this is nice. We love this. Yeah, I know. I know. It's great. You get a little kick out of watching it. That's it. You just described the mission of YouTube, right? So what's amazing about YouTube is if you have something to say, you just need a camera.

8:41Pedro Pina:And the biggest barrier of entry into this industry is the courage to press that upload button. Because that takes, if you think about it, it takes a bit of like, I'm going to put this out. But the moment you go through that, then you have a global audience waiting for you. And if you're good at what you're saying and if you have something interesting, if you have an audience interested in what you have to say, the whole engine starts kicking in. And it's just it's just a beautiful story. I love that you said that because, you know, I'm probably one of the older creators on the platform. As in, I started doing this maybe seven years ago, so my mid 40s.

9:17Yeah. And I had to get over that as well. It's not like because I'm a bit older, I must be more confident. I'm like, will anyone listen? What if I say the wrong thing? Do I look good on camera? It's quite vain, but you start asking all these kind of questions. What if it's not perfect? But actually, it's the imperfections, I think, and the authenticity that matter.

9:37Pedro Pina:That's right. The secret of YouTube is always and has always been authenticity. So I always say that the YouTube cemetery is full of YouTubers who came to YouTube to make money. If that's your purpose, if that's why you're here, you're not going to succeed. And the reason why is because the content you're going to create is not really authentic. You just want to do it for the money and your audience will pick it up in a heartbeat. And they are not interested. So YouTube creators that are successful are the ones who have a point of view. They have a passion. They really, that passion and that authenticity comes across, which creates that bond of trust with their fans and with their audience, which is everlasting.

10:24Pedro Pina:So that's a community that they nurture and they grow over time. And they're there for their fans and vice versa. And that is what makes their living sustainable. Their financial sustainability comes from the fact that they have this reliable, as you said, predictable relationship with their fandom, which monetizes really well and can keep on going. but you cannot ever fail your fans. So you need to keep truth to your voice. And if you do that, you're fine. And consistency is important. Consistency is critical. It's a key bit that people forget about showing up every day consistently delivering what people like to do.

11:08Who are the biggest creators currently on the platform that people might be surprised?

11:13Pedro Pina:I mean, if you look at it from a viewership standpoint, um well first of all i have to say the biggest ones i'm not sure it matters because the the youtube is so big they have you have we have so many creators that when even when you are a big creator in the context of three million you can be as big as you want but but in the context of million creators, it doesn't really matter. So our ecosystem doesn't rely on five names or three names or 15 names or 20 names. It's actually hundreds and thousands. It varies a lot per country as well. But again, it's very fragmented. And I believe that's a good thing.

11:59Pedro Pina:Now, historically, because we've been around for a long time, there are, you know, stuff like by far the most viewed video is Baby Shark, which everybody knows. Do you want me to do a demo here? Oh, can you? Yeah. You've got a shark kind of tip. So Baby Shark, Gunman Style. I mean, there are so many that became Susan Boyle. I mean, we have over and over again examples of that, but what really, really matters is that size has still to be proven to be the critical thing at it really isn't as a matter of fact so if you were to choose between subscribers views or engagement which one would you pick i would say views and watch time subscribers it's a interesting metric because it allows you to have a better relationship with your fans in the sense that they get notified every time you put a new video.

13:03Pedro Pina:It became an interesting vanity metric, which is, it gives you a sense of how people are committed to your channel. But the reality is we have plenty of evidence that people go to your channel and they don't necessarily subscribe to this. In fact, if you listen to Stephen Bartlett from Diary of SEO, every time, every single episode he asks, can you please subscribe to my channel? He asks for that. And the reason why he asks for that is because through that metrics, it improves a lot the algorithm response to the fans. So they make sure that the fans are fed with the latest information about the YouTuber, which is really important.

13:42But when it comes to engagement with your community, what really, really matters is

13:47Pedro Pina:views and watch time. Watch time is how much time people spend watching you. That determines pretty much their level of interest, depth of connection with you. It will determine the amount of inventory that is eventually served in your YouTube, which allows for higher monetization. So watch time really, really matters. That's really interesting. So if you build watch time, you'll benefit from then being served to a bigger audience because it's a good, so it's like, it's almost like a flywheel. It really is. So it's the, it's the biggest, now you have, so you have, you have leading indicators like engagements, comments, subscriptions, are ways that are leading indicators that people are really leaning in and really interested in your channel.

14:36Pedro Pina:Views gives you a sense that people really want to know more. Watch time is the ultimate predictor of your success. Yeah. And maybe a tricky question, but how do you get the sort of organic versus paid balance right as a creator as well, because obviously you can pay to achieve views. But then from what you've just said, you need to focus on great content, increasing watch time. So it's more about making sure the content to begin with is really good. It's 100 % about making sure that your content, it's a pull strategy. You need to make sure that people really want to see it. They really look for you.

15:10Pedro Pina:They really want to watch you. It's not anymore. This is something that I've been talking to a lot of legacy players who want to move to YouTube. You need to move away from I have something to say and I want to force it to put in front of someone, which is really the legacy tradition. And it's more about create content that people really want to see. They really look for it on an ongoing basis. It's a loyalty game. And that loyalty game has to do with the fact that people really, really want to see you. We will help. Our algorithm knows our audience, so delivers to the audience what they want.

15:45Pedro Pina:but it's at the end of the day it's about the quality of the content you produce and and therefore the quality of the content you produce it's a it's the marriage between number one your passion what you really want to say and how well you know your audience so this is a conversation i have with a lot of youtubers often they come to me and say well should i do shorts i'm not sure or i'm like do you know your audience i mean no there's no i get one of the questions i get more often is what does it take to have a successful YouTube channel? And the answer is very frustrating for most people because they expect a recipe or do this 15 things.

16:25Pedro Pina:Exactly. And it's not. It's do you know what you want to say? And do you know your audience very, very well? Because if you do, you will know what kind of formats they want. You will know for how long they want you to talk about, the things you talk about. And you will know how to deliver those. Do you have a voice? Have you found out your voice? And if you did, then you're going to be successful. Otherwise, not. Isn't it interesting that in marketing, the most fundamental question is, do you understand your customer? It doesn't change, does it? It doesn't go away. I know. So you're absolutely right.

16:58Pedro Pina:Being customer-centric. Remember that? I know. Put the customer at the center, which is the number one CMO thing. Like, oh, put the customer. But then do you really? It's the same as YouTube. Well, that's the gap, isn't it? It is. That's the gap. It is between what you say and what you do. And actually, what I find in interviews I do, what marks really successful CMOs is they found a way to remain very – I mean, Corey Marchisoto often quote on this. She's president of Elf Brands. She calls their strategy zero distance. Create zero distance between you and your customer and everything becomes easier.

17:31And then she adds to that, reduce the time from insight to action. and i love that and that is because also the further higher up an organization you go the more distance gets created yeah and your job is to reduce that distance it's funny you say that

17:44Pedro Pina:because if you think about it that distance is zero for youtube creators right if you think about it all youtube creators they spend an absurd amount of time daily daily looking at the data from their videos. I usually say that YouTubers, their public personas are beauty influencers, or they are travel adventure guys, or they are mental health experts, or you name it. We all know amazing YouTubers that we follow. When you shut down the camera and the lights, they are data scientists they can play back to you what the data profile is for their youtube channels who's watching them in which countries for how long in which formats they know exactly which content works for each one of the formats they know exactly how to shoot what they need to shoot and it's all data driven it's not in it's not like hunch and intuition it's all embedded in the data, which they study religiously every day.

18:52Pedro Pina:Isn't that interesting? It is. So that distance. So they are the ultimate CMOs, if you think about it. Oh, look at that. You know, they really are the ultimate CMOs. They understand intimately, through data, their audience. And that's why they answer to them so well. To give you credit as well, YouTube Studio does make that accessible. That's right. Doesn't it? That's right. You know, so I would behave. And now powered by AI, by the way. Yeah. Yeah, yeah, yeah. So, you know, new episode. So our episode will come out and within a couple of hours, I'll be looking at, oh, how's the retention rate?

19:27Are views ahead of where they normally are? Yeah. You know, because you make the graphs very easy to digest.

19:33Pedro Pina:And in the case of this episode, it's going to be a huge success. A smashing success. Yeah, yeah. I can predict that already. We'll make sure of it. You have to do some paid media behind you. There we go. We just have to make it more interesting as we can. I wanted to ask you, you know, YouTube as a media, would you consider yourself to be a broadcaster competing with Netflix or competing with TikTok? Where do you see yourself? Because I find you sort of in the middle of things. You could be everything. It's never good to be in the middle. I think we are a category on our own, if you think about it, because if you take a step back, You can watch incredible content from original YouTube creators, but you can find amazing TV and movies and full broadcasting type, what people call premium content on YouTube.

20:24Pedro Pina:You find live sports, but you can play games. You find massive gaming. You have trillions of views on Minecraft. You have the biggest library of music. You have the biggest library of history. You have the biggest library of podcasts in the world. So what are we? We are also on long form, but you can find it on short form on feeds. You can find live transmissions all the time. You can find it on a tablet, but you can watch it on a big screen in your living room. What are we? My big question is, does it matter? I don't find the question particularly useful because, again, let's just be customer-centric.

21:03Pedro Pina:What we really, really want is to deliver. our mission is to make sure that you can find the content that you want anywhere, anytime, at any format, the moment you want to. I want to see this movie on my laptop while I'm in Cannes. You can. I want to see this clip from the prime minister yesterday. I find it on a YouTube feed. I want to see, you can find it in every format, any moment. And delivering this requires a lot of technology. It requires a lot of investment. But we are single-mindedly focused on that. Back to our founders at Google, follow the user. Everything else will just come after that.

21:51Pedro Pina:And we are single-mindedly focused on that. The other thing I think you do in addition to those things is you're an incredible search engine for problems. Oh, I know. so the boiler the boiler doesn't work i know i know literally i know you've just i know you've just told me my number one i know who doesn't have a boiler exactly like i've got this weird random boiler with a weird code i don't understand and i need to get it restarted i know the stuff that doesn't yeah yeah don't we all yeah yeah or i broke it you know my bike's got a mechanical fault and i'm 25 miles from home and i need to fix it it's got a weird kind of screw that well and now with the ai the best thing is you can actually do a video of it and you can actually pick up precisely the model precisely the issue and then get the answer so it's amazing and you mentioned a youtube shorts as well um how important is it if you're building your channel to also create content for shorts as well as longer form content yeah it's back to what i told you before um it depends on what do you want to say um what's your what's your passion what's your mission?

22:56Pedro Pina:Why do you have the YouTube channel that you have and what are you delivering? And what does your audience want? We have creators which are huge on YouTube that started on shorts and moved to long form. We have YouTubers who started on long form and now moved entirely to shorts. We have creators who are multi-format, so they produce all sorts of format. Some creators use shorts as a way to reach a wider audience, to bring them to long form. There are creators who almost have a double persona. They produce content for long form for certain types of viewers and fans of them, and they have a separate type of audience for their shorts.

23:43Pedro Pina:So again, what we want to do is to have a plethora of options for creators. That's why we like to call our ourselves the home of creators. You come home and here you have the options to express your creativity and to feed your audience. You can make it all a mix of all the format for the same content. You produce different content. You have different audiences, same audience, and you run them through your different formats and you build your own footprint depending on really your vision. We want to be the most creatively rewarding platform for creators, financially too, and emotionally because you have a deep engagement with your audience.