Running YouTube Ads On A Budget


YouTube might seem out of reach for advertisers with limited budgets, but you can run YouTube on a budget. In this blog, we explore how best to do this, by focusing on:

  • Audiences on YouTube - tips on reaching the most relevant users at a cheaper price
  • Video Formats - suggestions for cost effective, lower funnel formats targeting conversion-based KPIs
  • Creative - best practice guidance to ensure you get the most out of your video ads
  • YouTube Ad Budgets - advice on how to maximise your reach and minimise wasted spend
  • Tips and Tricks for YouTube - a few additional pointers on how you can set your campaigns up for success


If your budget is limited, a great way to ensure you get the most value out of your advertising spend is to target lower-funnel audiences. Although you won’t reach a large volume of people (thus ensuring your spends are low), these users are more likely to engage with your ad and convert on site. Lower-funnel audiences consist of: remarketing lists, CRM lists and custom intent audiences. 

Within your remarketing campaign, we’d recommend targeting users who’ve previously visited your site, those who’ve converted and perhaps users who’ve abandoned items in their baskets (if applicable). Serving these users an ad showcasing a new line of products or to alert them of an upcoming sale, for example,  is a great way to entice customers back to the site to convert. You can take a similar approach with your CRM lists, segmenting these by intent (if possible) and targeting each segment in different campaigns.

Custom audiences work by putting together a list of terms and anyone who’s searched for the terms on Google Search is then eligible to be served an ad on YouTube. These audiences are a great way to marry up two channels, ensuring you reach prospective or existing customers who’ve demonstrated high intent, having searched for your targeted terms on Google Search, while they watch content on YouTube. 

As well as using audiences to target users who are likely to convert, we’d also recommend making use of audience exclusions to omit users who have low levels of engagement from your campaigns. You could set up audience lists consisting of users with high bounce rates, those who’ve demonstrated low engagement levels based on time on site, or even customers who’ve purchased within a recent time-frame to further limit your reach (i.e. during the campaign’s run-time) as the likelihood of them converting again so soon is slim.


Pairing the lower-funnel audiences recommended in the previous section with formats that are built to encourage direct response is another strategy you could implement to make your limited budget go further. TrueView In-Stream ads are skippable after the first five seconds and come with customisable call-to-action overlays and companion banners to encourage users to take action. We’d recommend tailoring the message in these overlays to your goal to get the most out of your low-budget campaign. 

There’s also the skippable TrueView for Action sub-type, which is the ideal choice for lower-funnel YouTube activity due to its automated bidding focused on Maximising conversions or targeting a specific CPA. You will need to ensure that you have a sufficient volume of conversions to enable the latter bidding type; we therefore recommend using some soft conversions (think site engagement GA goals, or basket additions) in order to ensure this threshold is met. 

Skippable Ad

With these skippable formats, you’re charged only when someone views your ad, where a view is defined as watching 30 seconds of the video, or its entirety (whichever comes first). This format is therefore great to use to ensure you’re only paying for prospective customers who’ve chosen not to skip and continue watching the video.

Another ad format where advertisers are billed on an engagement basis is TrueView Video Discovery. These ads appear on YouTube’s homepage on mobile, on the YouTube search results page and across watch pages. You’re charged when someone clicks on the ad to view it, meaning you’re only paying for users who’ve intentionally clicked to view your ad ensures you’re minimising the costs accrued on users who have no intention of converting.


Ensuring that your video creative is as fit for purpose as possible is essential when looking to run ads on YouTube, let alone if your budget is restricted.

It’s imperative that you create digital focused assets, or if you are using cuts of assets used for other channels, that you frontload your story arc and branding. It’s highly likely that you’ll be making use of the Skippable In-Stream formats as these are the most affordable on a smaller budget, and as such for the majority of users you’ll have 5 seconds to grab their attention and get your point across.

Creative BP

A good YouTube ad doesn’t need to have massive production value to succeed, it’s more important that you have a simple and concise message, with relevant calls to action utilised. If your video creative is longer than 20-30 seconds, consider cutting it down. You can always use the longer cut as a remarketing ad to users who have viewed the initial shorter ad. If you have a bit more budget to play with, It could even be worth creating a 6 second version to use as a Bumper too, for a little bit of additional cheap reach and something to function as a teaser or an echo for your full ad(s).

The next thing to consider when building your video ad is audio, which should be a primary focus as viewers expect audio on the platform, unlike on Facebook for example. Google’s correlation studies also show that sound is associated with fostering attention and positive brand response from users. Therefore, making sure that voiceovers are recorded with good quality sound equipment and your audio as a whole matches up with the tone of the visual elements of your ad is crucial if you want to hit the right notes with your audience.


YouTube is one of the trickier campaign types to budget for within Google Ads, especially if your spend is restricted.

Reach Planner within the Google Ads UI can be useful to get an idea of what you’re likely to drive in terms of volume and engagement for specific audiences, but you should definitely only consider this an estimate to inform your own forecasting, rather than budgeting solely off the back of it.

Reach Planner

The most similar campaign type to YouTube is probably Gmail, as you’re serving a creative on a specific platform  only and cost per interaction tends to be lower than 10p. In a similar way to Gmail, it’s more effective to run bursts of YouTube activity, focusing your budget over a 2-3 week period to make sure it goes as far as it can without your creative suffering from fatigue with users.

A good approach to keep your budget spread more evenly and prevent users being overexposed to your ad during your campaign’s run time is to ensure your impression and view caps are kept low; about 2-3 per week is a good amount. That way you’ll be able to keep running for a bit longer on a slightly lower budget without inhibiting your reach or capping out by hitting your daily spend limits.

Tips & Tricks

Our final section is a list of tips and tricks you can implement to further ensure you run a cost-effective campaign on YouTube:

Location Targeting

  • Consider narrowing your reach through location targeting.
  • If you have physical stores, trial radius targeting, reaching only users who are located within a set radii of your store.
  • Review your bid adjustments regularly and ensure these are reflective of performance.

Ad Scheduling

  • Consider preventing your ads from serving across your worst-performing days of week or times of day.
  • You could also align your ad scheduling with your opening hours if your conversion goal is to drive calls to your business, for example.

Frequency Capping

  • These can be set per day or per week, and allow you to specify how many times you want to serve an ad to a user (either as an impression or view).
  • Setting low frequency caps narrows your reach, thus ensuring your budget goes further and avoids over-saturating users with ads.

Content Exclusions

  • We’d always recommend reviewing the placement report to exclude any poor-performing channels or videos. 
  • On top of excluding poor-performing placements, exclude irrelevant topics or content types too to further reduce the inventory you’re eligible to serve on and save on costs.
  • If your Brand has particularly strict guidelines, running on Limited Inventory rather than Standard Inventory ensures your ads serve only across the most advertiser-friendly content free from inappropriate language but does restrict your reach.
  • Consider excluding family-related content to prevent your ads from serving against content aimed at very young children, as they clearly won’t be engaged no matter how good your ad is!


Ready to learn more? Contact Merkle today.

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