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In this complete guide, I will delve into everything there is to know about YouTube advertising costs to help you maximize your budget and achieve incredible results.
With its massive user base and unparalleled reach, YouTube is an awesome way you can connect with your target audience in a captivating and engaging way.
But how does YouTube advertising work? And is it worth it?
Let’s find out now!
Read more: Create Your Own YouTube Ad Campaign.
Quick Summary
- YouTube advertising varies in price depending on your budget, target audience, industry, ad type, and video quality.
- Generally speaking, ads can have a cost-per-view from $0.010 to $0.030, typically costing around $2,000 per 100,000 views.
- YouTube Ads use the same bidding strategy as Google Ads, where the cost is determined by others bidding for the same ad placement.
What Is YouTube Advertising?
YouTube advertising is when businesses promote their products or services through video content or advertisements on YouTube.
There are many types of video and static YouTube ads (more on this soon), and the type of ad you choose depends on your campaign goals, budget, and payment preferences.
YouTube offers two pricing models:
- Cost-per-view (CPV): You pay when users watch non-skippable ads.
- Cost-per-engagement (CPE): Requires payment when users interact with an ad. The fee depends on your chosen advertising format.
YouTube ads can appear before or during a video, in search results, as a pop-up, or in the bottom line of the video. The placement of the ad depends on the chosen format.
This may seem daunting at first….especially if you’re a complete beginner. But I promise that YouTube ads offer significant benefits, so stick with me!
Read more: How Much Is SEO For Small Business?
How Much Does YouTube Advertising Cost?
Google owns YouTube, so if you want to advertise on YouTube, you’ll need to use Google Ads.
So, like other Google Ad campaigns, the cost of YouTube Ads is run through a bidding process for ad placement.
Therefore, it’s difficult to determine the exact cost of YouTube ads.
The cost of your YouTube ad will vary based on factors such as:
- The production quality of your video.
- Your target audience.
- Goals you’ve set for your campaign.
- And ad format type.
However, on average, YouTube ads have a cost-per-view ranging from $0.010 to $0.030, with each view contributing to your overall YouTube viewer count.
To give you a better idea, reaching 100,000 viewers typically amounts to an average cost of around $2,000.
Read more: What Is A Good CTR For Google Ads?
YouTube Ad Format Costs
YouTube has various advertising options, each with different pricing. Typically, larger ad spaces and increased exposure come at a higher cost.
There are several YouTube ad formats available, including:
- Display ads: These are integrated into the YouTube page, often positioned to the right of the video and above the ‘suggested videos’ section.
- Overlay ads: You’ll see these at the bottom of the screen, covering 20% of the video. They can be image or text-based and can be closed by clicking the ‘X’ in the corner.
- Skippable in-stream ads: These are the most popular YouTube ad formats and can be seen before, during, or after a video. Viewers can skip these ads after 5 seconds.
- Non-skippable in-stream ads: Viewers must watch these ads all the way through before accessing the main video. Typically, they last for 15-20 seconds.
- Bumper ads: Bumper ads have a maximum duration of six seconds and must be watched before watching the video.
- Video discovery ads: You’ll find these within the search results, appearing in the right-hand sidebar or on the YouTube homepage.
- Sponsored cards: These ‘cards’ provide additional information about your videos and appear as teaser cards for a few seconds.
- Masthead ads: Masthead ads are 24-hour digital billboards that appear on YouTube’s homepage (often used by larger companies with bigger budgets).
With this wide range of ad formats, you can choose the most suitable option based on your goals, budget, and target audience!
Read more: How Does PPC Advertising Work?
Ad Placement Bidding
The cost of your YouTube advertising also depends on your bidding strategy for specific ad placements.
YouTube Ads operate on a bidding system (like Google Ads) where the cost of placing your ad is influenced by other advertisers bidding for the same ad space.
Before setting your bidding options, it’s important to define your targeting parameters, as this will further impact the cost of your YouTube ad.
In most cases, you’ll be bidding on either cost-per-view (CPV) or cost-per-mile (CPM).
Under CPV, you only pay when someone views your ad for over 30 seconds or interacts with it (whichever comes first).
If your ad is less than 30 seconds long and the viewer watches it all, it also counts as a view.
For certain ad types, pay-per-click (PPC) advertising is also available.
You’ll also need to set a maximum daily budget so you don’t exceed your spending limit if your ads receive more views than anticipated.
YouTube will prompt you to bid a maximum cost per view, providing an average bidding range based on your narrowed-down target audience.
Read more: Which Is Better, PPC or CPC?
Why Advertise on YouTube?
With over 2.7 billion active users, you’d be silly not to advertise on YouTube!
And as the popularity of YouTube continues to soar, you need to understand the benefits advertising on YouTube can have for your business.
Here are just some of the advantages of YouTube Advertising campaigns:
Wide Digital Reach:
YouTube is the second largest search engine (after Google), available in 100 countries and 80 languages!
Regardless of your industry or product, YouTube allows you to connect with your target audience effectively, making it an ideal platform for boosting brand awareness.
Cost-effectiveness:
Running a YouTube campaign is actually quite affordable, as you’ll only pay when consumers engage with your ads.
Plus, with an average cost-per-view ranging from $0.010 to $0.030, YouTube ads are pretty affordable compared to other ad types.
Precise targeting:
YouTube offers advanced targeting options beyond basic demographics and preferences.
You can specify the ad’s topic and relevant keywords or even choose specific pages for ad placement – how impressive is that!
This level of targeting precision allows you to showcase your ads to the right people at the right time.
Comprehensive analytics
YouTube’s robust analytics help evaluate your ad’s performance, consumer behavior, content, and more.
These insights enable you to optimize your campaigns to boost your brand online!
Read more: My Top Recommended Business Tools For Small Business.
Stews Final Thoughts
And that wraps up this YouTube Advertising Costs Guide!
As you can see, the cost of YouTube advertising isn’t so clear-cut.
Many factors, including your budget and industry, the ad format, bidding strategy, and ad placement, determine how much you’ll pay for YouTube advertising.
But the good news is that you have complete control over how much you spend on YouTube ads, so you can factor this into your budget when planning your digital marketing strategy.
Thanks so much for reading all the way to the end!
