So you want to be a YouTuber, eh? A lot of people do — in fact, it’s one of the most desirable career aspirations of young people today! YouTube has come a long way since the days of cat videos and Chocolate Rain, and making a career out of it has never been more possible.
But there are some things you’re going to need to know before making the big bucks, including YouTube CPM rates and how advertising works on the platform. Read on for an in-depth guide into CPM and making money on YouTube.
CPM stands for “cost per mille”. Mille is the Latin word for “thousand”. Therefore, CPM determines how much money a YouTuber makes per thousand views.
CPM is paid out to YouTube by companies that might advertise on your video, who take a percentage of the money and also give the YouTuber a percentage.
To make money off YouTube you have to have an AdSense account and allow advertising on your videos. These ads usually come in the form of mid-rolls, meaning ads that play throughout your video, similarly to how CTV advertising works. The length of your video will depend on how many ads you can fit into it, and the content of the video overall will determine whether it’s advertisable or not.
Advertisers have been getting more and more strict towards YouTube in that past few years, and many videos uploaded today simply aren’t advertisable. This includes videos with heavy language, videos that cover controversial topics, and anything that may offend. If you want to make a decent CPM, you’re going to have to consider taking measures to make your content advertiser-friendly.
You also want to consider things like SEO practices so more traffic is driven to your videos and more people can find you. There are companies out there that will take care of YouTube SEO for you which may be worth investing in in the long run.
Your CPM is split up before being sent to you. YouTube takes 45% of CPM as their cut, so if you were making a $10 CPM (considerably high) you would actually be making $4.50 per thousand views. That’s a pretty big cut, which incentivizes YouTubers to get a lot of views and pump out a lot of content if they want to make a livable wage off their videos.
The YouTuber’s cut of the CPM is known as RPM, or, Revenue per Mille. To get a bigger RPM, you need to get a bigger CPM.
Finding your CPM is easy! First, you need to see what you’re earning in a month from YouTube. You can easily do this by visiting your AdSense account and clicking on the “payments” tab found in the settings.
AdSense will tell you how many views you totaled in the last month, and how many of those views were monetized (Monetized Playbacks, they call them). Certain playbacks are not monetized, such as those from people with ad-blockers, which makes this distinction important. Take the number of monetized views you got that month and divide that number by the amount you earned in that same month, multiply that number by 1,000, and you’ll get your RPM.
There are calculators available online that will do most of this work for you. CPM and RPM are not explicitly shown or given, so it’s important to make these calculations so you can determine what numbers you need to try and bring in if you’re trying to make a living off YouTube.
You’ll earn CPM for any ad that is viewed in its entirety, or any ad that is clicked on. A skipped ad will not earn you CPM.
YouTube gives YouTubers a lot of options when inserting ads into your videos. Not long ago YouTube allowed its users to put unskippable ads in their videos, ensuring that those creators will get paid their CPM.
Of course, nobody likes unskippable ads so it’s important to consider what filling a 10-minute video with unskippable ads might put forth to your audience. This will likely become the norm more and more as YouTube creators continue to upload, however, so it’s probably worth it putting at least a few of those in there.
There’s a bit of a rumor that gets passed around online that mobile ads don’t pay CPM, but this is false. Any ad that’s watched fully will pay CPM, including those watched on mobile. Perhaps this wasn’t the case at one time, but now it seems to be.
If a viewer is using an ad-blocker you’re not going to be getting paid for that, as the ad simply won’t show up for them. It’s also worth noting that users won’t always be shown all your ads for the sake of their own experience. If someone is watching a ton of videos at once, YouTube’s algorithm will pick up on this and show them only a limited amount of these ads for the sake of retention and keeping the user interested in watching more.
There are a few different types of ads that a creator can throw into their YouTube videos.
TrueView for Reach is one of their latest offerings. It inserts ads ranging from six to 30 seconds in length, all of which are skippable after six seconds. These ads don’t need to be completed to pay out, instead paying you once 30 seconds worth of their ads have been watched total.
TruView for Reach offers programmatic ads, making it extremely lucrative and easy for advertisers looking into the YouTube space. For the YouTuber, these may not pay as much of a CPM as regular 30-second ads, but it definitely adds up and ensures that you’re not filling your videos with a ton of unskippable 30-second ads.
Non-Skippable ads are ads that, as you may have guessed, can’t be skipped. These used to run for 30 seconds at a time, but YouTube recently chose to max these out at 20 seconds for the sake of mobile users’ data and retention. These can be inserted as pre-roll (before the video starts) or mid-roll (as the video goes).
Bumper ads are unskippable as well, but only last up to six seconds. They pay out CPM once 30 seconds worth of ads have been viewed, similarly to TrueView ads, only unskippable as they run for a max of six seconds.
Depending on the length and content of your video, you can fill it with as many ads as you like. However, overfilling a video with ads will ultimately wain on your audience, and could even drive some of them away. Having three unskippable 30-second ads is undoubtedly the best choice if you’re trying to make bank, but it’s also a good way to make people bored and click away from your video.
The best practice is to use a variety of ads. Mix in some bumper ads as they’re short and relatively painless, and try to limit the amount of 30-second ads in a video. Pre-roll seems to be a good place for a 30-second unskippable ad, as it ensures the viewer will watch the whole thing to get to the content they want.
This also means you want to make the best possible content for your viewers. This is a bit of a given, but good quality content that you’ve worked hard on means more viewer retention, growth, and repeat viewers, which means more CPM. If the content of your video can be found elsewhere with less ads, chances are a portion of viewers will go there instead, so always focus on making your viewers’ time waiting for ads worth it.
Work on making catchy titles, vibrant thumbnails, good content, and implementing some SEO tactics into your descriptions and tags, and you’ll find yourself making a lot more CPM as your viewer base grows.
CPM varies greatly, but the average CPM in the United States is somewhere between $6 and $8, meaning an RPM of 45% of those numbers.
The average CPM also varies on a by-country basis. The United Arab Emirates tends to have the highest CPM, averaging 8% larger than the average US CPM. Canada, the UK, Austria, Germany, Australia, and New Zealand have CPM rates comparable to that of the US, while places like Serbia, Ukraine, Liberia, and Moldova making significantly less.
These numbers are simply determined by advertiser interest. The economy is better in the US and Canada than it is in Serbia, for example, meaning advertisers are willing to pay more to creators in these countries. It’s unfortunate, but that’s just how the cookie crumbles.
The larger your channel is the more you’re likely going to be making as CPM simply because more people will be viewing your videos. Advertisers will pay out a larger CPM to those who are able to get their products seen the most — that’s business 101. So if you want to bump that CPM up, it’s time to get cracking on the YouTube game.
The easiest way you can hurt your CPM is by making content that’s not advertiser-friendly, as touched on earlier. This means censoring out any inappropriate language or images, avoiding sensitive political subjects and matters, and generally keeping things family-friendly. YouTube is always rolling out new rules to stop harassment on the site and make it more advertiser-friendly, with one of their latest attempts seeing them implement an updated “anti-bullying and hate speech” policy to punish repeat offenders.
These rules are understandably a little murky, and there has been a lot of backlash surrounding them. Certain words and phrases alone worked into your title or said in your video will limit your ability to host ads, even if the context isn’t hurtful or provocative. It’s more important than ever to cover all your bases to make a video monetizable, even if you end up censoring some things that seem silly.
Some YouTubers simply aren’t happy with their CPM payouts and that dreaded 45% that goes to YouTube. That’s why they use other income methods to supplement their CPM earnings.
Affiliate Marketing is when a YouTuber will advertise a product in their video and give a link to the said product in their description. Whenever someone hits this link, the YouTuber gets a portion of the proceeds. Amazon tends to do this a lot.
YouTubers have also gotten heavily into sponsorships over the last decade. These sponsors will give YouTubers an affiliate link or code for money off their products that they can give to their viewers in exchange for an ad in the video. The YouTuber then gets a portion of each product bought.
Podcasters have gotten very into the sponsorships, a lot of which are much more flexible than YouTube in terms of what they find monetizable.
Other YouTubers make a huge amount of revenue off merchandise sales and clothing lines, and even apps and games they might create. This requires a bigger fanbase most of the time, but if you’ve got it, it can make you a lot of money on top of that CPM.
You should now have a better understanding of how YouTube CPM works, and how to make the most of it. It can seem intimidating at first, and the numbers may seem low, but as you continue to grow your subscriber base and collect viewers, you’ll notice it only gets easier and easier. Just keep that content flowing, keep it high quality, and keep it advertiser-friendly, and you’ll be swimming in CPM in no time.
If you need help with your advertising needs, including YouTube SEO, check out our services page. And feel free to contact us with any comments, questions, or concerns.
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