Understanding YouTube advertising fees is an essential consideration for anyone looking to create a video marketing campaign on the world’s second-largest search engine. While many small businesses are concerned that YouTube ads will be expensive, they can be a cost-effective way to increase their brand awareness and drive measurable ROI from their marketing budget.
YouTube ad costs are determined by a variety of factors including your bid strategy, targeting options, ad quality, and competition for ad placements. It is recommended to experiment with a variety of bidding strategies and make continuous optimizations based on key performance metrics like CTR, view rates, conversions, and return on ad spend (ROAS).
Breaking Down Fees: Understanding YouTube Advertising Costs
Depending on the type of advertisement you’re running, ad prices will vary. For example, bumper ads are short, non-skippable advertisements that are typically charged on a cost-per-thousand-impressions (CPM) basis. Bumper ads can range from $20 to $50 or more per thousand impressions. Display ads, which are banner advertisements that appear on the right-hand sidebar of a YouTube watch page or the homepage, are typically charged on a cost-per-thousand-impression as well. However, the average price of a YouTube ad can range from $0.20 to $2 per thousand impressions.
When you use a bid strategy like Target ROAS, you set a target return on ad spend and YouTube optimizes your bids to achieve that goal. However, you should keep in mind that the more specific you make your targeting, the higher your YouTube ad costs will be.
