A Complete Guide to YouTube Advertising

YouTube is currently the world’s second largest search engine, right after Google.  With over 1 billion active users i.e. 1/3rd of all Internet users, more than 30 million daily visitors, and 1 billion hours of video consumed per day. It also has 80% of all 18 to 49-year olds using it to learn or be entertained. Also worthy of note is that more than half of YouTube views occur on mobile devices.

According to a study, 96% of consumers surveyed found videos helpful for making online purchase decisions. As advertisers, that’s all you need to know.

What makes YouTube unique is that sound, sight, and motion elicit an emotional and physical involvement with content among users, this is not the case for most platforms. Also, YouTube ads help you connect with potential customers in a unique and memorable way, because you’re engaging users already tapping into all these senses.

YouTube’s unique combination of video access, sharing, and community creates enough opportunity for audience engagement — but more importantly, provide a gateway to conversions.

YouTube Ads, Way back When

YouTube ads development effort started in August 2006 when YouTube’s first ad concepts were launched: Participatory Video Ads and Brand Channels.

Late in 2007, YouTube launched InVideo Ads and the YouTube Partner Program, followed by several developments in 2008 which include: YouTube Insight (analytics), Click-To-Buy e-commerce platform, Promoted Videos, and Pre-Roll Ads.

In 2009, the DoubleClick acquisition had closed, this enabled Google to leverage DoubleClick. Early in 2009, Homepage Ads expanded from 1 to 7 formats. Later in the year, YouTube launched Individual Video Partnerships and Video Targeting along with enabled Skippable Pre-Roll Tests.

In March of 2010, YouTube launched mobile ads.

Ever since then, YouTube has been really focused on incorporating YouTube with Google’s display business, in order that advertisers have more control over where ads are shown and are able to build scalable campaigns that span both Google Content Network and YouTube.

And as you’ll guess, it’s been quite and upward climb in monetization efforts.

Campaign and Network Types

YouTube has three options for advertising campaigns:

Standard: This campaign type is for non-ecommerce, non-app-install advertisers (i.e. most YouTube advertisers, and most likely, you).

Mobile App Installs: As the name implies, this is for promoting an app and generating installs for it.

Shopping: This is for promoting products in ecommerce.

For the YouTube network delivery options, you have:

YouTube Search: This is used when you want your ads to show up within YouTube’s search results.

YouTube Videos: This is for if you want your ads to be viewed while videos are playing only.

Video Partners on the Display Network:  To use this, you must select the “YouTube Videos” option, allowing you to show your video ads on and outside YouTube i.e. on the regular AdWords Display Network (display ads with video).

For starters, I recommend selecting both “YouTube Search” and “YouTube Videos”, as we’ve found from experience that they carry a higher customer conversion intent compared to the Video Partners on Display. This is because you have less control over where your ad shows within the Video Partners and Display Network. This means you have less control over the quality of traffic.

Video Ad formats on YouTube

YouTube has six video ad formats you can choose from:

  1. True View: These are the most common YouTube ads, they come in two forms:
  2. In-Stream Ads: These ads are viewed before, during, or after a YouTube video has been played. They play either on YouTube.com itself or on other sites / apps via Google Partners. In-stream ads are the ads you can skip after the first 5 seconds of play time. Should they get skipped within the first 30 seconds, with no interaction, you don’t pay a penny. So, you can keep on building brand awareness for free, but don’t forget we’re after conversions, so the main goal is to have users click through and become customers.
  3. Video Discovery Ads: These types of ads can appear in multiple places across YouTube, and the web via partner sites and mobile apps. They may display as a clickable thumbnail of the actual video ad in the YouTube search results, just next to related videos, on YouTube’s home page, and finally partner sites and apps.
  4. Bumper Ads: These ad types are the short 6-second video clips that viewers cannot skip. You may find this ad format in the options when you create a new ad group. They are short, simple, and to the point.
  5. Non-Skippable Ads: These ads consist of ads that are 15 or 20 seconds long and are not allowed to be skipped, so that they’re always watched in their entirety. The hitch with these is that they require a minimum dollar investment to run, which is why you won’t see smaller brands/advertisers using these.
  6. Display Ads: Remember, we can use text ads and regular display image ads to advertise on YouTube as well (with pixel dimensions: 300×250 and 300×60). To target specific videos, or channels within YouTube, you can use their URL as placement targeting for this ad format where they would show to the right of a video our potential customer is watching. Note: This is a cheaper format to advertise compared to the skippable in-stream ad. Also, these ads only appear on desktop / laptops (i.e. no mobile).
  7. Overlay Ads: This is another type of display ad, but its location appears directly “over” the video being viewed. Below it, you’ll see examples of a horizontal ad above a video and the square display off to the right. The pixel dimensions for this type of ad are 468×60 or 728×90, they can also be a regular text ad.
  8. Sponsored Cards: This ad type does superbly well for ecommerce advertisers who want to showcase products that are seen in the video…Right beside the actual video itself. To create a YouTube card, enter your Creator Studio > Video Manager > Edit Dropdown of Video.

Add-Ons to Ad Formats

There are two different add-ons: Companion Banners and Call-to-Action (CTA) Overlays, that run alongside ads.

Companion Banners: These are optional ads. They can’t run as solo ads, as they must follow alongside a video ad. The benefit of this add-on is that they increase the overall clickable real estate on screen.

If you will be selecting your own media, stay at 300×60 pixels and a maximum file size of 150 kb. Should you choose to use these and do not have your own content, Google will create some automatically based on the visuals of your video ad.

Call-to-Action Overlay: This allows you to pair text and visuals (74×74) alongside your video ad. These are critical for taking maximum advantage of your YouTube ad.

Video Ad Targeting

YouTube ad targeting is similar to the Display Network, with some key differences.

Demographics: You may choose gender, age, household incomes or parental statuses of your audience. But be warned, like Search and Display, many of YouTube’s users are considered to be “unknown” for these segments.

Affinity Audiences: Essentially, these are the same for YouTube as they are for the Display Network. Here, you can target users based on the website they browse and videos they watch. Within this segment you have:

In-Market Audiences: According to Google, these are the users who are in the “researching phase” of their purchase cycle.

Custom Affinity Audiences: Where you can create your own audiences by layering different interests/domains.

Video Ad Bidding

It’s standard process to set up with Google’s CPV (cost per view) bidding for your YouTube campaign. With this bidding strategy, you’ll be charged for both views or associated advertisements.

Fortunately, a “view” is only counted after a viewer watches at least 30 seconds of your video or the whole video (if your video is less than 30 seconds).

Note: there’s an option to adjust bid for “popular videos”. This is useful for advertisers who want to ride the wave of viral videos to get their ads displayed in front of YouTube’s most popular content.

Conversion Tracking/Analytics

Setting up conversion tracking for YouTube is just the same for Google Ads. Therefore, if you already have an account set up with your conversion tracking and Google Analytics in place, then you’re set to go. Also, YouTube boasts some cool features for breaking down analytics, as well as some additional metrics. 

Best Practices for YouTube Advertising

Here are some best practices to make the most out of your YouTube Ads:

  1. Focus on direct response and not branding awareness: Your goal with YouTube ads is to boost ROI through conversions, not pour money for “brand awareness”. To start, you may not see as much conversions coming from the bottom of the funnel, unless you’re remarketing or using a custom audience. I’d recommend developing two strategies, one for improving on top – mid funnel conversions and another for monetizing your past viewers with remarketing. If you’ve been curating your remarketing lists (as you should). Simply select the one you’d like to target and add a video.
  2. Reduce the threat of your offer: Think of breaking down the path to conversion into smaller, easier steps. Use your video ads to answer customer questions or curiosities. Remember, your end goal is to make money. Most times, you won’t win a customer over or get the sale with the first glance, so develop a strategy for nurturing users all through the conversion funnel.
  3. You have 5 seconds to make the magic happen: Keep in mind that your goal is for people to be interested enough to convert on your offers. If you notice that many people are skipping your ad, or perhaps the play time is short, consider modifying the opening of your YouTube ad.

Honestly, the length of videos doesn’t matter. What matters is your content, make sure to provoke the purchase, rather than extensive brand awareness. Bring your viewers through a journey, make your content count!

In conclusion, there’s no question that YouTube holds serious potential to advertisers, marketers and brands. The potential for success is immense and whether YouTube ads can generate the big bucks is not a question. If you’re looking to drive sales or brand awareness, YouTube possesses the power that could quickly scale your online sales.

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