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Digital Marketing

YouTube Ad fundamentals and how they can benefit your ecommerce marketing strategy.

The ads you see placed across YouTube aren’t just there by coincidence, they are strategically placed through the powerful targeting capabilities YouTube communicates towards audiences. However, you’re probably thinking how will this benefit your ecommerce strategy, over other platforms? Here’s what you need to know:

What are YouTube ads?

Advertising on YouTube (using Google ads) is a great way to target and reach your audience through video content, across videos or in search results to help maximise the reach of your ads to the right audience.

It’s also important to note that YouTube is owned by Google, and is almost completely synonymous with it’s parent site and company, making it one of the most powerful platforms due to it being the world’s second-biggest search engine. Google processes over 3.5 billion searches per day and over a billion hours are streamed across youtube daily. Google will always provide video search results from YouTube over any other video streaming site, making the two work seamlessly together.

Furthermore, there are 6 formats of Youtube ads, which are based around campaign goals and objectives.

Types of YouTube ads & what they can bring to your e-commerce strategy 

1. TrueView ads

TrueView ads are the main ad format across this channel, due to providing users with the most control over their ad space with ‘skip ad’ options, with Google reporting that 8/10 viewers preferring this over other video ad formats. Breaking down TrueView ads further they can be divided into ‘in-stream ads’ which are displayed before the user’s video, and ‘discovery ads’, which are displayed within search results.

While users prefer this format, it’s also great from a business perspective, due to its PPC (pay per click) spend system, where advertisers only pay when a user watches at least 30 seconds of content or interacts with the ad. This makes it a cost-effective and low-risk tactic to be implemented into your strategy due to ad spend being only on those engaged, meaning users can be targeted on a wider scale, with those uninterested being naturally filtered out.

2. Non-skippable instream ads

Similar to TrueView ads, Non-skippable instream ads provide the same format such as being displayed before and during the video, without the option to skip ads, leaving this format unpopular with users, due to the lack of control over there stream, leading to 76% of consumers automatically skipping ads out of habit.

However, this format does not operate like TrueView, where cost is only spent on content engaged with. Non-Skippable instream ads use a CPM (cost per mille) approach, where advertisers pay per thousand views. This format can benefit your strategy by providing mass exposure to a wider audience (in comparison to its sister format TrueView) by focusing on quantity over quality to reach your audience on a wider scale, with its CPM ad spend ensuring your content will be seen.

3. Bumper instream ads

Next, we have bumper ads, another non-skippable ad format with a 6-second limit, which is displayed before the user’s video is played. Again this means the content is exposed to a wider audience which can be digested easily by the masses due to its short ad time. Furthermore, just like non-skippable in-stream ads, bumper ads also use a CPM format, meaning your content is ensured to be seen, however is a more cost-effective way to earn exposure compared to non-skippable instream ads, due to the restricted ad time. 

4. Sponsored card ads 

Sponsored card ads are small CTA (call-to-action) pop-ups, which presents relevant content (to the video being streamed), in the right-hand corner of the video where users can click on the small ‘i’ to expand sponsored cards. This format is seen as less intrusive as those reached can directly go and look for further information in a short journey to the top right of their page, over being forced to engage with content not relevant to them, through non-skippable ads.

5. Overlay ads 

Overlay ads are a form of banner advertising which overlays across the bottom of the video being streamed. Banners can be both image and still text formats, and give users ultimate control. They do this by giving users the option to exit the ad on-screen and users can also turn overlay ads off completely, meaning that the users who have Overlay ads left on are more likely to engage with them through CTA’s placed within the ad.

6. Display ads 

Alongside Overlay ads, Display ads are one of the most simple ad formats across YouTube, where still images are displayed next to the users streamed video, and has the ability to be presented in multiple sizes.

Display ads can be used to support your video ads, acting as a placeholder once the ad has been skipped or viewed, allowing to re-engage users after ad viewing experience in a different format to continue grabbing attention and increase CTAs to landing pages, for the user journey to be continued.

Overall YouTube ads can accommodate your brands different life stages but it’s still important to consider best practices when choosing ad formats for campaign success, with the example below showing how its done best:

The Dollar Shave Club’s minute and a half video went viral across the internet, and generated 12,000 orders in just two days, making them an overnight sensation, however, how was it done?

By following best practices set internally Dollar Shave club was able to create a funny and eye-catching ad, which provided entertainment for viewers while pushing brand messaging at the same time, allowing engagement to be created on a wide scale.

More amazing examples of best practices put into place can be found here. 

Best practices to consider:

  1. Keep video ads between 15 and 60 seconds. YouTube is both an entertainment and an intent platform.
  2. Captivate and relate.
  3. Show your brands messaging in action.
  4. Design ads for all platform versions.
  5. Explain to viewers what you want them to do.

  Get in touch or take a look at our services for more information. 

Chris Thomas


Chris Thomas

CEO & Founder

Chris has been at the forefront of eCommerce and a pioneer of online retailing since the early 00s. A 5-time Drapers Award winner, Chris has extensive experience in developing fashion brands online.

Chris founded Cake in 2016. Based in Birmingham, with offices nationwide, Cake specialises in helping fashion brands understand their market online and then helps to develop appropriate strategical direction to achieve their plan, all backed by his 20 years of operating in the retail market.