The Future with YouTube Advertising

Craig Graham
April 22, 2024

How to Navigate the Surge in Digital Ad Costs with YouTube Ads + Northbeam

Digital media is more expensive than ever. Meta’s rising Cost per 1,000 impressions (CPMs) alongside the skyrocketing cost per click (CPC) of Google Search, Shopping, and Performance Max (PMAX) are creating challenges for many advertisers.

Plus, since Meta is often positioned as an awareness and consideration channel as part of holistic marketing strategies, the rising costs are sending advertisers in search of cheaper “higher-funnel” media with similar (or better) performance.

Enter YouTube Ads.

YouTube advertising inventory can be purchased through Google Ads as “Video” ads. While Media buying teams are often intrigued about buying YouTube inventory, they rarely understand how to think about YouTube and measure its impact.

To be a better YouTube advertiser, you need to understand four things:

YouTube users rarely click on ads

Although you buy YouTube inventory with Google Ads, you can't think about YouTube through a traditional click-based lens like with Search and Shopping.

Clicks from YouTube tend to be a bonus side-effect of advertising, and shouldn’t be one of the primary key performance indicators (KPIs) considered when running YouTube campaigns.

The problem is that most digital advertising platforms are designed to measure media performance based on user click behavior. Without clicks, significant attribution is lost in campaign reporting.

Instead of clicks, your goal with YouTube is to generate the most engaged impressions and views for the lowest possible cost.

Since, when someone is on YouTube and sees an ad, they're likely already watching a video they chose to watch. The ad is interrupting their intended experience, which was to stay on YouTube and watch their content. 

The ads you serve them need to be designed around this experience and the user's expectation. They probably have little desire to click on anything unless it's another YouTube video. So, expecting them to click on your ad will set yourself up to be disappointed and ultimately, unsuccessful.

When using Google Ads for reporting, Impressions, Views, View Through Rate (VTR), Cost per View (CPV) are some of the KPIs you should be referencing.

You can't rely solely on KPIs inside Google Ads

YouTube Ads are difficult to track within Google Ads using metrics like Conversions and ROAS. If you rely on these types of metrics to guide your media buying decisions, you’re probably leaving a ton of money on the table.

Combine Google Ads reporting with Northbeam.

Utilising Northbeam is a no-brainer. The long lookback windows alongside one-day view attribution and proprietary modelling allows advertisers to see and understand far more revenue attributed to YouTube than most other sources. 

You also get a central source of truth for your Media Efficiency Ratio (MER) and Customer Acquisition Cost (CAC) metrics, since Northbeam uses your store’s revenue as an anchor to compare against all of your ad spend. 

There’s a few other things to look at while scaling your YouTube campaigns. 

▪ GA4: A free, useful tool for analyzing on-site behavioral reporting. Although you likely won’t get much in the way of revenue attribution for YouTube from GA4.

▪ Post-Purchase Surveys: As customers "How did you first hear about us?" directly on the order confirmation page, and list all of your marketing channels as options. This is a measure of customer-perspective marketing channel influence. 

▪ Lift Measurement: Google surveys users on YouTube for statistically significant lift measurement. These can be expensive and should probably be your last choice.

▪ Search Lift Studies: With the help of your Google rep, you can identify measurable lift from Search, correlated to your YouTube Ads campaigns.

▪ Google Search Console: Branded search term data changes. If your YouTube campaigns are getting your brand to stick in peoples’ minds, they’ll inevitably go to Google and search for your brand.

▪Google Trends: Branded search term and category data changes (see real example below):

▪ Geo Study: One control location, one test location. Measure the difference in branded searches, traffic, and other signals that indicate users are being influenced by your YouTube Ads.

▪ MER/Customer Acquisition Cost (CAC): These should improve over time as more people, having become aware of your brand, start purchasing.

▪ Email/Short Messaging Service (SMS) Platform: Monitor opt ins. Typically, email and SMS opt ins will increase with more relevant traffic, which comes from YouTube mostly in the form of branded search. 

Impression Frequency is a key component

Users probably won’t remember your brand or product if they see your ads only once or twice. It takes time for your message to stick inside people’s minds. If you're targeting the right audience with the right message, aim for an average impression frequency per user over a seven day period between four and six (measured within Google Ads).

That means you want every user to see your ads at least four to six times per week. User engagement tends to rise with higher frequencies, up to a point.

Try testing Ad Sequence campaigns for ensuring the same users are exposed to several different ads at a high frequency.

Creative quality needs to be high

Your ads won't perform if creatives aren't good enough. You can tweak the settings in Google Ads a million different ways, but your creatives are what make or break a campaign.

Here are some tips to getting YouTube Ad creatives right:

➡ Hook your viewers in the first three seconds

➡ Test running ads 30 seconds or longer

➡ Use audio and voice overs whenever possible

➡ Test different videos in different aspect ratios (square, vertical and horizontal) 

➡ Use your brand prominently (logos, colours, messaging throughout)

➡ Use a call to action at the end of the video

➡ Use different videos to walk users through all steps of the customer journey:

  • Brand feature video (introduce your brand to viewers in a memorable and engaging way)
  • Product-focused video (features, benefits, product demo)

  • Social proof video (customer UGC is great for this)

  • Offer video (showcase your offer and why viewers should buy from you)

YouTube is not just another advertising channel; it's a strategic asset that, when used correctly, can significantly reduce costs while expanding reach. By focusing on engagement metrics, integrating advanced tools, and producing standout creatives, you can leverage YouTube to its fullest potential.

This Blog was written by contributing guest writer Craig Graham. Check him out below:

Craig Graham

CEO/Founder at Grayvault Consulting 

Continue Reading

It's time to take your marketing

to the next level.

Chat with our team and discover how Northbeam can transform your business.
book a demo