CPM Youtube: Your Guide to What it is and How it Works

Do you want to learn more about how to make money on YouTube? Do you want to get more information on how you earn from ads on YouTube? This guide will discuss CPM YouTube creators need to know.

In 2019 research, YouTube became one of the top online platforms in the US. With its popularity, creators, audiences, and advertisers also surged in number. Today, it’s normal to see ads scattered all about YouTube.

If you are a YouTube creator and you want to learn how you earn from these ads, keep reading. We’ll discuss CPM and how it works. We’ll also give tips on how you can increase your CPM and what affects it.

1. What Is CPM on YouTube and How Does It Work? 

Hiring advertising services for your brand can take a long time to give back revenue. What if you get a decent amount of views per video and have enough followers on YouTube? You may be thinking of using that to your advantage and earning from your YouTube channel.

Let’s begin by defining what CPM stands for, which is Cost per Mille. We’re adapting the Latin term Mille, which means “thousand.” In other words, it’s the cost an advertiser pays per 1,000 ad impressions. 

You earn your CPM from any ads that get views or clicks. You pick a type of ad and insert them into your videos. When an ad gets viewed for the minimum time to pay, you get paid.

You also need to know about the RPM. RPM or Revenue per Mille is the parameter you need to calculate your income. The amount of CPM is in direct proportion to your RPM. That means that if an ad is more popular and gets more clicks, you earn more money. 

CPM vs. CPC: What’s the Difference?

In YouTube advertising, you may also hear about the term CPC. Whereas CPM stands for Cost per Mille, CPC stands for Cost per Click. It’s the traditional way of charging for ads. You’ll also find them on a typical YouTube page. 

They’re the ads you see around on a YouTube video that isn’t in the actual videos. Those ads get charged on a CPC basis. If you want to give your brand more exposure, the best strategy is to use a combination of CPC and CPM.

2. Ad Types on YouTube

A recent survey found that 49% of people watch more than five online videos per day. Consider how many ads they encounter on an average day on YouTube.

YouTube features different forms of ads on its platform. This gives creators the choice to pick the ads they want to put in their videos. You’ll notice that you likely already know or are familiar with each one. 

The first type is skippable ads. They may have a length ranging between six and thirty seconds. Because they’re skippable, the viewers don’t need to watch their full length to payout. Instead, you get paid once a total of 30 seconds of their ads get watched. 

Then there is also the non-skippable type, which lasts 20 seconds in total. They can go at the beginning or middle of the video. YouTube designed them to run for 30 seconds before but got changed for user’s mobile data and retention.

The next ad type is the bumper ad. These are ads that appear on the actual video and are not skippable. While they are unskippable, they also only last up to six seconds max. Like skippable ads, they pay once 30 seconds worth of ads gets viewed.

3. Calculating Your CPM and RPM

A lot of things will affect your CPM rate. The typical factors include your audience type, niche, and content. Others also say that your inventory and the country where you are in affect your CPM. 

You can use a YouTube CPM calculator to find out what your CPM is. Before you look for one online, you need to know a few elements first. First, you need to know how many views you totaled in the last month and how many got monetized.

You’ll also need to know how much you earned in that same month. YouTube will not tell you about your RPM and YouTube CPM rates. You’ll have to do the math for these values by yourself. 

How to Calculate Your RPM

Log in on Google so you’re also logged into your YouTube. Go to your AdSense account and open the Settings menu. Check the “Payments” section where you’ll see records of your revenue for the last month.

Enter YouTube Analytics and check the number of views under Monetized Playbacks. Ignore the formal number of views. Remember that not all of them reflect as monetized views.

With the numbers you see on your screen, start calculating. Divide your income for the month by the number of monetized views multiplied to 1,000. Let’s use an example so it’s easier for you to comprehend the equation. 

For example, you earned $500 from ad views for the last month and got 20,000 views. The equation will become 500/20,000 x 1,000 = 25. It means you earn $25 for every 1,000 views, which is a lot already.

4. What Is the Average YouTube CPM?

The average CPM YouTube creators have differs by country. In the US, the average CPM is between $6 and $8. That also means they have an RPM of 45% of those numbers.

YouTube creators in other countries can have a higher or lower CPM. For example, the United Arab Emirates has the highest CPM, averaging 8% more than the average CPM in the US. CPM rates in the UK, Canada, Germany, and New Zealand are comparable to those in the US. Meanwhile, CPM rates in Serbia, Ukraine, and Liberia are lower.

Why are the CPM rates different per country? The key lies in advertiser interest. If you live in a country that has a more stable economy, advertisers will pay more. If you live in a third-world country with an unstable economy, advertisers won’t pay as much.

5. How to Increase Your CPM Rates

Increase your monetized views. The more views you have that get monetized, the higher your earnings will be. The best way to do this is to be unique and interesting.

People love watching any unique and original content. They want content that is informative or valuable to them. Always make sure your content has educational aspects that audiences will find useful.

Try to keep your reputation clean and respectable. Avoid promoting violence, drugs, and other non-family-friendly ideas. Remember, you can create a video on UFC or martial arts without promoting unnecessary violence. 

Stay active and consistent. Avoid long breaks where you don’t post videos on your channel. This can hurt your CPM and provoke demonetization and closure.

Above all, always aim to create high-quality content. The actual content of your videos isn’t the only aspect of that. You also want to use meta tags, interesting soundtracks, and well-picked thumbnails.

What Decreases Your CPM

Every creator on YouTube needs to watch out for what they post online. A few missteps and you can end up in scandalous news headlines. Very few people can make millions amid scandals like Logan Paul.

Follow everything YouTube put in their policies and guidelines. That means avoiding creating content that is disrespectful, offensive, and hurtful to people. Keep your content as something that people and kids of all ages can watch.

A lot of YouTube creators like to exploit the titles of their videos by creating click-baits. Some even write titles that may be hurtful or provocative. Stay away from all things that viewers and advertisers will dislike.

6. Other Ways for You to Earn on YouTube

Sometimes, CPM YouTube isn’t enough to keep you afloat. There are other ways to earn money on your channel. We’ve made a list of them below.

Try your hand at affiliate marketing on YouTube. Are you a lover of fitness or makeup products? Use that enthusiasm to partner with stores and pose as a marketer on your YouTube channel.

Do you consider yourself an influencer on social media or YouTube? Join an influencer marketing network like Famebit or Grapevine. They help brands find channels that match their niche and needs.

Note that you need to check the requirements on these sites before you can join them. For example, on Grapevine, you need at least 10,000 subscribers to your channel to join. Famebit has a lower point of entry. You only need at least 5,000 followers to participate.

Practice your SEO outside of YouTube. Try to stay on top of your SEO game as well, especially if you already have an e-commerce site. You can earn good money on your online store if you take care of it well.

Up Your CPM YouTube Game 

That ends our guide on CPM on YouTube. We hope this guide helped you better understand how CPM works on YouTube. Do you want to see more content on digital marketing and SEO? We’ve got a blog filled with all sorts of useful articles for you.

Do you need help with CPM YouTube strategies? Talk to us at Go Florida SEO. You can learn about our services here.

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