The Cost Of Youtube Ads in 2020

How_Much_Do_Youtube_Ads_Cost
Youtube is one of the most influential search engines. If you want to succeed in improving your reach it is essential to utilize Youtube ads. But what exactly is the cost?

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YouTube is one of the most popular search engines, with over 2 billion logged-in monthly users, and processes more than 3 billion searches a month. YouTube is larger than Bing, Yahoo, Ask, and AOL combined.

Youtube.

A growing number of individuals turn to YouTube to find information on products and services. As the largest video hosting platform in the world and the second most visited website, YouTube primarily influences consumer behavior and forms the way people purchase products.

YouTube is a truly influential platform for people to share their content with the online community. The platform needs to be an essential component of your paid advertising strategy from a business perspective.

Wondering how much ads on YouTube costs? If you want to learn more about YouTube as a strong advertising channel and how much it costs to advertise on the platform, stay tuned.

Why Use Youtube To Advertise?

Let’s take a peek at the reasons you should choose YouTube before we discuss how much YouTube advertising costs.

Over one billion hours of content is watched every day by millions of users.

gif of youtube ads.

YouTube is one of the ideal platforms for companies to market their products/services, with such a large number of users spending a huge amount of time on a single site.

The following 3 features make YouTube a great video advertisement platform.

1. Enormous Reach

YouTube is both a social media network and a search engine that serves an immensely large variety of users of the internet. You will advertise your company to individuals who seek information and to those who want social interaction. Most other channels of advertisement do not offer such diversity and reach.

YouTube is, therefore, the right place to convey your business message to the widest variety of prospects possible.

2. Influence On Purchasing Behavior 

Studies have shown that YouTube has a big effect on buying actions. A Youtube insight report says that 72% of auto-vehicle buyers, 62% of smartphone buyers, and 66% of beauty product buyers reported that Youtube affected their purchases. 

The great thing about the app is that it allows customers to see how a brand can work into their lifestyle. Your content will directly impact your customers’ buying decisions.

3. Share Your Story To The Right Audience At The Right Time

All you have to do is show the right message to the right person and at the right time to achieve the best results for your brand.

When you make super attractive content for your target audience, the targeting features and analytics help you share your story with your audience at the right time.

How Much Does It Cost To Advertise On Youtube?

Since Google owns YouTube, companies use Google Ads networks to advertise on the largest video-sharing site. Like other Google Ads promotions, the expense of your YouTube ad involves bidding for ad placement.

So, when it comes to YouTube advertising costs, it’s difficult to come up with an exact figure.

On average, YouTube ads cost anywhere from $0.03-$0.30 USD per view.

There are a variety of factors that can affect your advertising cost.

Quality Of Your Content

In determining the total cost, the quality of your video ads plays a key role. If your content is not enticing, viewers are going to hurry to hit the ‘skip’ button, and your money is going down the drain.

To stand out from your competitors, the key is to create memorable advertisements. If your content is good enough to push your viewers to re-watch and share, compared to what you get in return, your Youtube advertisement cost would be nothing.

Google rates video advertisements based on how relevant it is to the target audience of an advertiser. It determines this by how many people actually interact with an ad.

Timing Of Your Ads

Be sure to offer content to individuals at each point of their buyer’s journey, regardless of the industry or company objectives. Tracking will help you find out when the time to get your message across is right.

Messaging Of Your Ads

If your messaging is off, your Youtube advertisement costs will be higher. It’s no surprise that the success of your digital marketing campaigns is largely dependent on messaging, especially YouTube advertising.

Testing different forms of messaging to see what works for you is probably a good idea.

Ad Format

There are four key formats for YouTube advertising. Each format has various mechanics, lengths, and periods at which it appears in the video viewing experience of users.

Be sure to explore format options before you begin creating ads. Some are more costly than others. Your audience may respond differently to different ad formats, so make sure you select the one your audience likes the most. We will go through the options in detail later.

Biding

YouTube’s ad placements work through a bidding method. The cost would be influenced by how much your competitors pay for the same ad placement.

You’ll be bidding on a cost-per-thousand (CPM) or a cost-per-view basis for video advertising. Each time anyone interacts with the ad or watches it for more than 30 seconds, you are paid.

Targeting

YouTube advertising campaigns should be designed in such a way that those who care about the brand or products are involved. Since advertising to certain audiences is more costly, targeting may have an impact on your cost.

To help them find the right audience, Google allows marketers to use plenty of targeting choices. You may decide, for instance, which YouTube channel your videos should appear on. To achieve a full return, you can also hand-pick specific videos.

You can search for and add channels in the ‘Placements’ when you create a campaign. For your campaign, it’s suggested to pick high-performance channels. We will talk about targeting options in the next section.

Targeting Options For Youtube Ads

For each one of your video campaigns, you will find a Target tab. To narrow down the types of individuals to whom YouTube can deliver your video ad, you use the Targets tab. The following are targeting methods you can choose:

  • Demographics: On YouTube, billions of individuals consume content. You do not want to target every single user. You need to display ads to individuals that are likely to do business with you. Based on demographics, you need to shortlist users by age, gender, income, etc.
  • Interests: Do you know the preferences and interests of your audience? If yes, based on their interests or preferences, you can select which audience you want to expose your content to.
  • Life Events: Often people go through big life changes, and they start searching for something that they weren’t interested in before. Marriage will, for instance, completely change a person’s goals and needs. You will only show advertisements to freshly married individuals for your travel service.
  • In-Market Audiences: When a user is searching for items close to yours and ready to purchase them, Google can tell. Target in-market audiences to find individuals who are most likely to buy from you.
  • Video Remarketing: Video remarketing is a way to reach customers who have already been in communication with your business. You can show ads to those who have already watched your advertisements or videos.
  • Placements: As previously mentioned, it’s possible to handpick Youtube channels or videos that you would like to advertise on. For example, you can advertise on tech channels if you are selling tech accessories.
  • Keyword: Select related search terms for a YouTube channel or video that might be of interest to your audience. Using negative keywords will help you display advertisements on related videos. Compared to Google ads, keywords are less costly to target on YouTube.

To keep the cost of your YouTube advertising down, but at the same time to make sure you get enough views, to make your campaign worthwhile, you need to target the right people.

Youtube Ads Formats

You can use a variety of video ad formats to create compelling video campaigns to reach consumers on YouTube. The following are six Youtube ad formats available:

Skippable In-Stream Ads

Skippable in-stream ads on Youtube Ads.
Source: Google

When should I use this ad format?

Use skippable in-stream ads if you have video content you would like to promote on YouTube and through websites and applications running on Google video partners before, during, or after other videos.

How does the ad format work?

Skippable in-stream ads play before, during, or after other videos. After 5 seconds, the viewer has an option to skip the ad.

Where does the ad format appear?

They appear on YouTube watch pages and across websites and applications running on video partners for Google.

How will I be charged?

With CPV bidding, you pay when a user watches your video for 30 seconds (or the full duration of the video if it’s shorter than 30 seconds) or engages with your video, whichever comes first.

With Target CPM, Target CPA, and Maximize conversions bidding, you pay based on impressions.

Which campaign goal(s) should I select to use this ad format?

  • Sales
  • Leads
  • Website Traffic
  • Reach and Brand Awareness
  • Brand and Product Consideration

Non-Skippable In-Stream Ads

Non-skippable in-stream ads.
Source: Google

When should I use this ad format?

Use non-skippable in-stream ads when you have video content you’d like to promote before, during, or after other videos on YouTube; and across websites and apps running on Google video partners; and you want viewers to see the entire message without skipping your video.

How does the ad format work?

Non-skippable in-stream ads are 15 seconds (or shorter) and play before, during, or after other videos. Viewers don’t have the option to skip the ad.

Where does the ad format appear?

Non-skippable in-stream ads appear on YouTube videos and across websites and apps running on Google video partners.

How will I be charged?

Non-skippable in-stream ads use Target CPM bidding, so you pay based on impressions.

Which campaign goal(s) should I select to use this ad format?

  • Brand awareness and reach

Video Discovery Ads

Video Discovery Ads on Youtube Ads.
Source: Google

When should I use this ad format?

Use video discovery ads to advertise video content as part of a YouTube search result, on the YouTube mobile homepage, in places of discovery, or next to related YouTube videos.

How does the ad format work?

Video Discovery Ads consist of a thumbnail picture from your video with text. Although the exact size and appearance of the ad vary, video discovery ads often invite individuals to click to watch the video, depending on where it appears. The video is then played on the watch or channel page of YouTube.

Where does the ad format appear?

Video discovery ads appear:

  • On YouTube search results
  • Alongside related YouTube videos
  • On the YouTube mobile homepage

How will I be charged?

You will only be charged when viewers choose to watch your ad by clicking the thumbnail.

Which campaign goal(s) should I select to use this ad format?

  • Brand and Product consideration

Bumper Ads

Bumper Advertisement.
Source: Google

When should I use this ad format?

When you want to broadly reach audiences with a brief, unforgettable post, use bumper ads.

How does the ad format work?

Bumper ads are 6 seconds (or shorter) and play before, during, or after another video. There is no option given to viewers to skip the ad.

Where does the ad format appear?

Bumper ads appear on YouTube videos, websites, and apps running on Google video partners.

How will I be charged?

Bumper ads use Target CPM bidding, meaning you pay based on impressions.

Which campaign goal(s) should I select to use this ad format?

  • Reach and Brand Awareness

Outstream Ads

Outstream Advertisement.
Source: Google

When should I use this ad format?

When you want to expand the reach of your mobile video ads, use out-stream ads, helping you reach more customers.

How does the ad format work?

Outstream ads begin playing with the sound off. By tapping the ad viewers can unmute the video. Outstream ads are designed to boost video reach at an efficient cost.

Where does the ad format appear?

Outstream ads are mobile-only ads and only appear on websites and apps running on Google video partners.

Outstream ads can run across a range of different mobile placements. For mobile web placements, out-stream ads show up in banners. On mobile apps, out-stream ads are displayed in banners, interstitials, in-feed, native, and both portrait and fullscreen modes.

How will I be charged?

You’re charged for out-stream ads based on viewable cost-per-thousand-impressions (CPM). This means you will only be charged when someone sees your video play for two seconds or more.

Which campaign goal(s) should I select to use this ad format?

  • Brand awareness and reach

Masthead Ads

Masthead Ads.
Source: Google

When should I use this ad format?

When you want to raise awareness about a new product or service or reach a large audience in a limited period of time (such as the event of a sale), use this format.

Masthead ads are only available on a reservation basis via a Google sales representative. If you want more information, go to about reserved media placements on YouTube.

How does the ad format work?

Desktop
  • A featured video at the top of the YouTube Home feed in a Masthead ad will autoplay without the sound for up to 30 seconds. In a widescreen or 16:9 aspect ratio format, the Masthead ad will appear and includes an information board to the right that incorporates assets from your channel automatically. In this board, you may optionally include up to 2 companion videos. If users want to hear the sound from the video, people can press the mute button.
  • The main video defaults to the video thumbnail after autoplay. Users are taken to the YouTube watch page for the video when they click on the video or the thumbnail.
Mobile
  • For the entire length of the video at the top of the YouTube app or m.youtube.com Home feed, a featured video in a Masthead ad can autoplay without the sound.
  • A video thumbnail, customizable headline, description text, as well as an additional call-to-action (CTA) are included in the mobile video Masthead ad. The Masthead mobile video ad also automatically pulls the name of the channel and the icon from the advertiser’s channel. When a user clicks on the Masthead mobile video ad, the featured video will go to the YouTube watch page.
TV Screens
  • In a Masthead ad, a featured video can autoplay (where supported) without the sound for the full length of the video at the top of the TV YouTube app. In a widescreen or 16:9 aspect ratio format, the Masthead ad can appear. To interact with the Masthead ad, users can use their TV remote. The main video defaults to the video thumbnail after autoplay. When people click on a video or thumbnail, they are taken to the full-screen watch page for the video.
  • It is not possible to include a CTA to a Masthead ad on TV screens.

How will I be charged?

Since Masthead ads are only available on a reservation basis, you’re charged on a fixed cost-per-day (CPD) or cost-per-thousand-impressions (CPM) basis. Google representatives can give you a cost estimate.

Note: Masthead ads can only be booked on a CPM basis on TV screens. All choices for targeting and ad serving are similar to other Masthead promotions booked on a CPM basis.

Optimize Youtube Campaigns

How much your YouTube Ad cost should not be your only concern. You should also care about what amount of return you will receive from your YouTube advertising cost. This means you ought to keep a close eye on your campaigns and then adjust them at regular intervals, to optimize their performance.

Reviewing your campaign statistics and knowing what they are indicating to you is the secret to maximizing your YouTube campaign. The View Rate of your ads and the Click-through Rate are the most significant stats. These figures show you what individuals find your ads convincing and whether they function as a campaign.

Youtube

The most common issue is that your videos are not very convincing. You need to revamp your videos to make them more compelling. Also, a lack of exposure might be your issue. This could be because you have been outbid by rival companies for the best advertising slots. You could experiment by bidding higher, and then watching how your ads work with higher exposure.

More than likely, you will find that by raising the amount you are willing to pay for your YouTube ads, you will obtain better results overall. Cutting corners may hurt your ROI and overall goal.

To Wrap Up

Advertising on YouTube is an immensely successful way to get your message out in front of the right people.

Since the cost of YouTube advertising depends on how you build your campaign, make sure that your campaign is more cost-effective and ROI-focused by building well-targeted and relevant advertisements.

If you want to learn more about Youtube, check out this article to learn tips on how to promote your Youtube channel.

If you’re ready to start advertising on YouTube and making the most of your YouTube advertising costs, contact our Youtube Ads Agency at SH1FT today! 😁

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