How to Use YouTube Ads

Back in 2004 when 3 PayPal employees Chad Hurley, Steve Chen, and Jawed Karim started a website to upload and publish video dating profiles, little did they know that one day that small website would become the worlds largest video hosting platform. Today YouTube is the second most looked at website in the world with approximately 2 billion users worldwide.

YouTube is often dubbed as a social media network. However it is more than that. YouTube is a search engine which gives search results in the form of videos as opposed to text and images on Google Search. 

As a search engine, YouTube has one of the most advanced algorithms in the world. The platform uses the data from searched keyword history from both its own and Google’s database and produces results that are intuitive and which maximise user experience. That is why YouTube is a goldmine when it comes to advertising and marketing of products and services. 

But when it comes to YouTube Advertising, there are so many questions which comes to mind - Why should you advertise on Youtube? How do you Place an advertisement on YouTube? What are the different ads you can launch here?

In this post we will attempt to answer the most commonly asked questions and provide you with a beginner’s guide on how to use YouTube Ads. This post is designed to be your ultimate guide on how to use YouTube for marketing and we hope by the end of this tutorial, you should have a view to deploy your own ad on YouTube to drive traffic and sales to your products and services. 

why use youtube ads

Why should you use YouTube Ads?

Is Advertising on YouTube worth it? 

Yes!. And here are the top six reasons why you should advertise on YouTube.

#1 - Global Reach:

With over 3 Billion search queries processed every month, YouTube is the second-largest search engine in the world next only to Google. YouTube is also the 2nd largest social media network outside of Facebook, with over 2 Billion subscribers, spanning over 100 countries. It is estimated that almost 79% of internet users today have a YouTube account. 

global reach

These statistics make YouTube one of the best platforms to place your advertisement. The platform operates on a global scale, and there is almost no limit to who you can target as a potential customer.

#2 - Marketing ROI (Return on Investment):

Advertisers love placing Ads on YouTube due to its increased ROI. As of 2019, roughly 79% of marketers consider YouTube to be one of the most effective marketing platforms in terms of ROI.

And rightfully so. You Tube Ads convert better than other social media Ads due to its effective impact. YouTube Ads are based on Video content that has twice the impact and retention of text or images. Further YouTube also provides the flexibility to create Ads in different types such as in stream, non-in stream and video discovery Ads (All discussed later). These Ad types are created to increase conversion by capturing the audience’s attention through effective timing. The platform further allows advanced retargeting by repeatedly showcasing the Ads to people who have shown interest in your product.

#3 - Wide User Demographics:

In addition to having a global reach, advertisers love YouTube because of the user age group which ranges from age 2 to 65+. 77% of YouTube users are between 15 and 35 years of age. 70% of the users are between 36 and 55 years of age. This translates to 70% of the audience on Youtube being people who are capable of making buying decisions. Minors too can click on a YouTube ad, get to the website of the advertiser, and then try to convince their parents to make a purchase for them.

wide user demographic

Regardless of whether you are selling a physical or digital product, there is a ready audience on YouTube who would be interested in your product provided it is marketed correctly. This is one of the reason, huge corporations, like McDonald’s, advertise on the YouTube.

#4 - Influence Buyer Behavior:

YouTube was the first platform which pioneered the concept of 'Followers'. There are YouTubers with millions of followers and there are also micro influencers with small but highly engaging followers. Depending on our budget, you can work with these influencers to showcase your brand in their videos and promote them as a sponsor. If they love your product and are incentivized, they will recommend it to their followers which can boost your conversions.

For example, if you are trying to promote power tools for woodworking, try to find an influencer who has a woodworking channel with a significant amount of followers. You can approach the influencer and send them a sample of your product.  The YouTuber can use and review the tool in one of their videos and if it performs well, they can encourage their followers to check out your product and buy it.

#5 - Advanced Targeting:

One of the perils of running paid ads is showcasing your products in front of people who have no interest in either the niche or in your product.

In YouTube, you can choose to target people who show an interest in your product. You can choose specific niches where you can show your ad. You can also choose the kinds of videos where you want your ad shown. For example -if you are selling woodworking tools then you can choose to portray your Ads only in videos about woodworking or DIY.

The advanced algorithm of this tool can also help you retarget the same people who have already engaged with your website. If a person went to your website and did not buy, the algorithm tracks their Digital footprint and the next time they watch a video, YouTube can showcase your ad again to that person.

Because YouTube is owned by Google, it has one of the best and most seamless advertising systems in the world. You can view your metrics, choose your demographics, choose your budget, and make sure that you are only advertising to people who are already “warm” to your products or services.

#6 - Easy to Use and Monitor:

Because YouTube is owned by Google, it has one of the best and most seamless advertising systems in the world. You can view your metrics, choose your demographics, choose your budget, and make sure that you are only advertising to people who are already “warm” to your products or services.

Types of YouTube Ads

Like all advertising networks, there are different ad formats in YouTube. You can choose the format that best appeals to your audience.

Skippable In- stream Video Ads:

These are skippable video ads that are mostly played at the start of a video. The ad allows the viewers to skip after 5 seconds

skippable in-stream video ads

Non-skippable In-stream Video Ads:

These are 15 - 20 second ads that play in their entirety without allowing viewers the option to skip them.

Video discovery Ads:

Formerly known as in-display Ads, Video discovery ads show your Ads on the YouTube search results page. They are usually shown at the top of the search page, or sometimes on the side bar.

video discovery ads

Bumper Ads:

These are non-Skippable 6 second Ads (or less) which can play before, during, or after another video. These Ads must be watched  before the video is resumed.

Overlay - Non-video Ads:

These are banner ads that are shown as overlay on the bottom 20% of the video like the one below

overlay non-video ads
overlay non-video ads with grammarly

A step by step guide on

How to setup YouTube ads


Having understood the basics of Youtube Ads, lets now walk through the step by step process on how to create a YouTube ad. The first thing you have to do is to log-in to your Google AdWords account. If you do not have an account, create one, and follow the steps below:

step 1

Create a new campaign

Once you are logged in to your Google Adwords Account, go to All Campaigns at the top left. You should see the screen below where you can click on the + sign.

Upon clicking, choose New Campaign.

new compaign
step 2

Select Campaign type

The type of campaign you choose depends on your business goals. For this example, we will choose Sales.

campaign types

No matter your choice in the previous step, you will given the option to choose the type of ad you want to run. Choose video.

campaign type with video option

Click on the Continue.

step 3

Fill out the details

In the next screen you will be asked to supply all the information needed for your ad. This includes the following: 

  • Campaign name
  • Bidding strategy
  • Budget
  • Date to run the campaign
  • Country to run the campaign
  • Languages
  • Keywords

Fill in the details and then move to Placement 

fil form for start


step4

Choose YouTube

At the bottom of the previous page, you will see Placement.Click this and you will see the below dropdown:

youtube channel and videos

Make sure that you choose both YouTube Channels or YouTube Videos. 

The last thing that you have to do is to type the keywords. This is the most crucial part of the advertisement process. You must do your keyword research first. The keywords you type here will tell Google how to place your ads in YouTube based on the user’s query.

keyword placement

Finally, click in the Create Campaign button at the bottom and you should be good to go. 

create campaign button

Optimizing and Analyzing the effectiveness of  YouTube Ads

YouTube Ad optimization and analytics works in the same way as other Ad platforms such as Facebook ads, Google Ads etc. These metrics must be monitored if you want to get great results.

Below are some of the YouTube key Ad metrics:

CTR  - Click Through Rate

Click-through-rate is the ultimate measure of your Ad’s effectiveness. It refers to the number of clicks that your Ad generates. If your CTR is high, it means that your Ad is effective and that people are reacting to it. If it is low, maybe the quality of your ad is poor, or you are targeting the wrong audience.

CPV  - Cost per View

This is the cost-per-view of your ad. If you spent $100 on the Ad and it is shown to 100 people, it means that you paid $1 per view. In order to lower your costs, you should optimize and choose a wider range of audiences for your Ad.

Impressions and Views

Impression is the number of times the Ad was shown to a customer. The bigger the impression, the more people saw it. A view, on the other hand, is 30-seconds worth of watching an Ad. If the ad is shorter than 30 seconds, a view is its entire duration.

If your impression count is low, consider showing your ad to more people by expanding your audience. If the view is low, your Ad may not be that interesting, or you are showing it to the wrong people.

View Rate

This is the percentage of people who watched your Ad, provide that it was served to them. It is your views divided by your impressions. The higher the View Rate, the more engaged your target customers are. This also tells you if you are targeting the right people and how interested they are in your offer.

It is important to monitor your stats on a weekly basis to give you enough data to validate if your Advertisement is working. This is also why we do not suggest launching an Ad for only a week, unless it is your first time and you are just testing waters. Ideally, you should run your Ad for at least a month, look at the stats and then fix the pediments on the Ad and run it again. From experience, it takes at least 3-4 attempts to get your Ad, audience and content right for increased conversions.

ways to generate and optimize website traffic

How to Monetize and Generate Traffic through YouTube

This is the most important aspect of this article - Traffic Generation and conversion through your YouTube platform. 

 The tips discussed here are about generating traffic from YouTube, and how you can monetize them through sales.

Use the right Keywords in the Video Title

Use the right keywords in your title. The algorithm of YouTube is similar to Google and other search engines. Content is indexed based on the title, meta data and description. If you use the wrong keywords, your content will be indexed on another category, and people who have an interest in your actual content may not find your video. 

A title describes the nature of your content and is one of the most important aspects of your video. The title gives people a brief idea of what the content is all about and if it would be of interest to them or not. It is important to do keyword research beforehand and structure your title to standout from competition. One of the ways is by generating curiosity. For example, if your video is about python programming for games then instead of using a generic title such as “python programming.”, use “how to make money with python programming for games”. This not only generates curiosity but also provides viewers with an accurate description of your video. 

Provide Quality Descriptions

A thoughtfully written video  description is the second most important thing for your video (next to title). Description is the text that is below the playback screen of your video. The description explains the users the details about the video, its content and also provides links to other content or products they may find useful. It is also an important element for algorithms to pickup for rankings. 

The YouTube search algorithm works the same way as the Google algorithm. For the search engines to pick your video for display, it is important to embed your main keyword in the first paragraph of your video description. This increase your chance to rank when Youtube robots crawl on your title and your video description.

Use Effective Thumbnails

Thumbnails are the images that show up on top of the video. Thumbnails increase or decrease the appeal of your video hence its important to aesthetically design thumbnails that are enticing to viewers. 

There is no standard format for a thumbnail. You can use images, or embed texts. The key point is to have a thumbnail which stands aside from the competition. For example, your headline could be “Ten Safety Tips in Using a Power Drill.” Your thumbnail can show a person who was hurt and bloody, and your thumbnail text is “Do not let this happen to you!”

Pro-Tip - Use Canva.com for creating your thumbnails for free.

Create Subtitles or Transcripts

Videos with sub-titles are often grab more attention especially from viewers who are not well versed in understanding a different accent or may have trouble hearing due to hearing issues. By providing captions, you would be doing a good service to your audience who will happily subscribe and follow you along.

Provide Educational or Entertaining Content

The one thing which guarantees regular viewership and subscription is the amount of value add you are providing through your videos. To ensure regular traffic, you have to make sure your content is either educational or entertaining. Also the content must be real meaning, whatever you teach should be relevant and can be replicated in real life by anyone else in a similar situation.

One suggestion for new channels is to produce a series of content which follows sequentially for 4-5 weeks. Keep the videos fun and entertaining so viewers are going to be encouraged to subscribe and wait for your next video.

Another suggestion is to make the first few seconds of content enticing enough to capture the attention of your viewer. Most people skip to other videos if the intro or the start of the video is not exciting. If the viewer leaves, the YouTube algorithm records it as a bounce and signals to YouTube that your content is not great. This triggers the algorithm to skip your video in search results.

Publish New Content Regularly

The last and the best advice on how to get YouTube traffic is to publish regular content. This is the key to generate a fan following. Once you have avid subscribers eager for your new content, you can channel them to your website, blog or email list for future conversion.

Regular content publication also puts you at a good spot in YouTube’s algorithm. It tells the system that you are a serious content creator, and your other videos will be shown to the user while they are watching one of your videos. 

Summary: A Beginner’s Guide on How to use YouTube Ads

With a 2 billion user base, spread across 100 countries, YouTube is a gold mine for online advertising. The platform offers one of the highest ROI's in the advertising world and is easy to use and monitor even for beginners. However just like all paid Ads, the effectiveness of the Ads is based on the below factors:

  1.  Ad Quality 
  2. Targeted Niche 
  3. Targeted Audience 
  4. Keywords

It is essential for marketers to focus on all the 4 parameters above and monitor the results on a weekly basis. Small tweaks in either of the 4 parameters can sometimes boost the conversions by a significant bit.

Lastly if you want to gain traffic organically, publish quality content on a periodical basis and focus on keywords to rank it. 

Similar to Facebook, YouTube should be one of your focal points in advertising. The market is huge and often converts better than other platforms for both digital and physical products alike. 

by Amber

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