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Everything You Need to Know About YouTube Advertising

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Do you want to run YouTube ads but have zero ideas where to begin? Perhaps the mere thought of putting out your first ad is so daunting that it has kept you from monetizing your YouTube channel for the longest time. Or maybe you're still in doubt if your ads will actually turn into conversions, or if they will even generate any revenue.

Don't worry, it is perfectly normal to get cold feet in the early stages of being a YouTube creator. But if you want some motivation to push through with YouTube advertising, know that the platform's worldwide ad revenues totaled $7.34 billion in the second quarter of 2022. This is an increase of 5% from the previous year. So if you're asking, is YouTube advertising effective? You bet it is!

YouTube dashboard
Learn everything there is to know before posting YouTube ads so you don't waste money

How much does an advertisement on YouTube cost? This may be one of the many reservations you have about putting up ads. In this post, you will discover everything there is to learn about posting your very first YouTube advertisement so you can stop wasting time and start getting more bang for your buck. And if you need help with your social media management, our Hopper HQ review can do that for you.

Create Your Own YouTube Channel

How can I advertise on YouTube, you say? These ads are run using your Google Ads account, but first, you will need to set up your own YouTube channel.

Log in to your Google account, then hover over YouTube. Click on the profile picture found on the top right-hand side. There you will see the first option which is Create a Channel.

After clicking, add a name, then click Next. You have just created your YouTube channel. This is where you will upload the video you want to run as an ad to this channel. But first, you need to create your Google Ads account.

To begin, go to then click on Sign in. It's best to use the same Gmail login for both your YouTube channel and Google Ads account. Next, click on the New Google Ads Account button so it can create your account.

Your Google Ads account will now present you with options. One of them is being able to connect your Google My Business account. If you have an existing YouTube video that you wish to run as an ad that's uploaded to your new YouTube account, select your video. It will then ask for your video's URL.

However, if you don't have the video you need to run yet, select Your website then go through every single prompt pertaining to your business information. It may ask questions about your budget, or a different ad copy for this new Google Ads account. There's no need for you to use the options to run your current YouTube ad, but choose whatever you want on these prompts so you can move through the setup process. Only then can you create the ad you want to run on YouTube.

Linking your Google Ad Account to Your YouTube Channel

Your Google Ads account is now set up, so the next thing you want to do is link your YouTube channel to this account you have just created. To do this, go to the Tools and Settings button found at the top-right and click on the Linked accounts option.

When you see a YouTube channel, click Manage and Link. You will then see a blue + button to click on. You can type in your channel name, or simply paste your YouTube channel's URL. But if you signed in using the same Gmail account that you have for your YouTube channel, expect it to auto-populate.

Choose the Video you Plan to Run as an Ad

Go to your YouTube channel and click on YouTube Studio found on the top-right, then click on Content. You can upload your video there, or look for the video that you want to run as your YouTube ad. You can choose to have this video Public, but it's better to have your ads unlisted so it won't show up on your channel. Then get a shareable link to paste the URL of this specific video to paste on your Google Ads account.

Your Google Ad Campaign

Return to your Google Ads account then choose the Create New Campaign option. The next screen will ask you to select the goal you will use for this campaign. You can click on Create a campaign without guidance.

Next, select the type of ad you would like to run as a YouTube ad, and in this case, it's Video. Next, it will give you the option to choose a campaign sub-type. You will decide where your ads will be shown. For this example, choose Custom video campaign then click on Continue.

Select Ad Settings

dashboard showing the number of YouTube views for the past four weeks
Consistently monitor your views to see if you are reaching your target audience

To select your ad settings, go through the prompts one by one. Choose the options that suit you best. Note that the campaign name must be related to your campaign's goal or the particular YouTube ad you're going to run. Only you will be able to see the name of your ad.

You can use two options for your bid strategy. Either utilize the Cost per View or the CPM, which is the cost per thousand. For now, choose Maximum Cost Per View. Under Budget and Dates, you can choose a daily budget or the overall budget for your campaign.

If you go for the overall campaign budget, you will need to put the start and end dates. However, if you choose the daily budget, there's no need to select any dates for that. For now, go for the daily budget.

Your next option will be the Networks. There are three various options to choose from. YouTube search results will show your ads on the YouTube search results. While the YouTube videos option will show your ad inside YouTube videos. And finally, the Display Network allows your video to be shown on other platforms apart from YouTube. For this example, choose YouTube videos.

Next, choose the country and location you want your ads to be shown, plus, the language you wish your ads to be shown in. Then you have the Inventory Type. For now, select the Standard Inventory option. Such options pertain to the type of content, and primarily sensitive content that your ads may appear inside or next to.

The next option will be to exclude your ads from particular types of content. These can be live-streaming videos, games, or even embedded YouTube videos. If you don't want to exclude your ads from these content types, just go to the next prompt. You will also be given the option of adding a related video. This video below your own video ad is meant to give your ad more context.


You have two options under the Conversions tab. If you already have one set up, select the option for choosing a conversion action for your ad campaign. Or, just leave it as the default. But since this is your first ad, you can leave the additional options to default.

If you wish to run your ads on certain days of the week, or specific times of the day, so you can reach your audience at their optimum time or make the most out of your budget, you can experiment with these options. And to make life easier as a YouTube creator, check out our Social Aider review.

Choose Your Target Audience

targeting audience demographics for effective YouTube advertising
YouTube advertising won't be effective if you do not have the correct demographics

Next, create a name for your ad group, then move on to the audiences and placements for your advertisement. The first option that will pop up is your demographics. Check off the ages, genders, or income levels of your choice, or just leave them all selected. Then continue with these specific audiences on the next tab.

Under the Audience segments tab, select the type of people you want to see your ad. Affinity audiences are related to things these people are interested in. Just remember that YouTube is the second biggest search engine in the world, with Google holding the number one spot. So they have a high level of data on people's interests.

Affinity audiences are usually extremely accurate. But if you click on the Browse tab, you can see additional audience segments to choose from. Some will be based on your own business data. For this post, we won't select any of these audiences and target them based on placements.

Next is the Content tab, which relates to the audiences you're. You can target based on topic, keyword, or placements. Placements tend to be a bit misleading as they pertain to people who are going to see your video ad, and not just where your ad will show up on the screen. You will have the option to choose specific YouTube videos or channels, or websites that these people have gone through.

Choose Your Bidding Amount for YouTube Advertising

Now, you need to go through the bidding section, which is where you will put the maximum amount of money you are willing to pay for a view of this video ad. A good starting point for most businesses would be $1. You won't typically pay one dollar per view, but that's enough wiggle room for the algorithm to show your ad to a bigger number of people without putting a limit on your reach.

Creating Your Video Ad

skippable vs non-skippable ads
Deciding whether to use skippable or non-skippable ads will depend on what works best for you

To create your video ad, select New Video Ad. For this example, you can do a skippable in-stream video. You can paste this URL from the specific video ad you will be running. Additional options are entering the destination, where you want the audience to be directed to when they click on your ad. They also give you about 10 characters for your call to action. For your headline, you have 15 characters, so be concise.

You also have the URL or UTM parameters for adding to your specific ad. Then give your ad name then click Done. After going through all these options, click on the Create Campaign button. You have just created your first YouTube ad video.

How Does Advertising on YouTube Work?

Using YouTube analytics for tracking progress
Utilize your YouTube analytics to track your progress

You will know if your YouTube advertising efforts have paid off by analyzing your Video Ad performance. First, click Continue to Campaign. Here, you will see the ad group you have created. When you see a green dot on the left, this means your ad group is currently active.

To your right, it must say Eligible. If your ad is not approved, you will see on the ad level a note, saying something like 'Rejected.' It could still be pending and being reviewed. You must wait for YouTube for approval before your ad starts running. However, this does not take very long.

On this screen, you can see your number of users, your cost per view, link clicks, and your conversions. If you are tracking your conversions from YouTube Ads, there are a couple of ways for doing this.

Conversions can be set up within Google Tag Manager. It is also possible to create a standalone landing page for your YouTube ads. In this way, you know the conversions that are coming from this page have resulted from your YouTube ads. A call tracking number could also be used if you want people to call your business from this ad itself. When your ad goes live, those analytics will begin rolling in.

How Can I Advertise On YouTube?

Now that you know the answer to this question, the next thing to learn is how to improve your YouTube advertising analytics. There are several ways to do this, but one of the most effective is video scripting. But overall, running ads on YouTube shouldn't be all that daunting. The key is simply to get started.

Once you know the basics, like setting up your YouTube channel and Google Ads account, you're good to go. From there you will get to decide the best YouTube advertising rates to suit your needs and by looking at various YouTube ads examples, you will know which parts of your journey need improvement as a creative.

To get a better idea of how to be the best marketer or influencer you can be, read our blog on 15 Top YouTube Influencer Marketing Agencies You Need to Know.

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