YouTube can be a confusing place. It is the world’s largest video sharing and content creation site, with millions of videos being uploaded to it per day and potentially billions being uploaded every year.
There is just so much to it that it can be hard to understand exactly what is going on with YouTube.
This can include the different genres, creation styles, and even the terminology that different creators use when uploading their videos.
Since YouTube is so big, a lot of this jargon is specific to the site itself, which makes it even more confusing, and one of the most important pieces of jargon used when describing successful videos is CPM.
But what does CPM mean? Will knowing about it help me to create a successful YouTube career as a content creator?
What Does CPM Mean?
CPM quite literally stands for ‘Cost per Mille’, which might not make a lot of sense to native English speakers, but when you know that Mille means 1000 in Latin the phrase then becomes ‘Cost per 1000’.
The ‘Cost per 1000’ is referring to how much an advertiser will pay per 1000 views of their advert, or rather the cost of the ad campaign to the advertiser per 1000 views.
This metric is very useful for three groups of people: the content creators on YouTube, the advertisers themselves, and YouTube itself. The reason is very simple, adverts are the reason anyone on YouTube makes any money.
Without advertisements, not only would there be no money in becoming a creator on YouTube, the entire platform wouldn’t be worth much money at all either.
This makes advertisement the primary method of monetization on the platform, and so creators are constantly trying to make their content appealing enough for advertisers to pay them to display their adverts.
This is why you see so many content creators within the same fields and genres of videos, like beauty, makeup, and reaction videos. These areas are the most viewed on the platform and – as such – advertisers want to put adverts more on these videos.
Advertisers will also want to put their adverts on videos that are linked to the product they are advertising as well. The audience for a video that is unrelated to their product are unlikely to buy said product due to having little interest in it.
For example, one of the biggest advertisers on YouTube currently is the game ‘Raid: Shadow Legends’, but you are unlikely to see this advert on a beauty channel, because it is not applicable to the audience.
How Is CPM Calculated?
The CPM per video and creator varies in cost and how much the advertiser is willing to pay in total. There are a variety of factors that affect this, including the bidding price, the consistency at which it is displayed, the type of advert, and so on.
Let’s say that the advertiser pays $10 per CPM for the advert campaign that is put on your video. The amount of views this advert received was 5000.
That $10 is then divided by 5000, which equals the amount of money that has been agreed upon to be sent to you as the content creator. In this case, $10 divided by 5000 equals $0.002.
To work out the Cost per Action (the amount of money you make per 1000 views) you need to then times that $0.002 by 1000, which equals $2. This may not seem like much, but it fully depends upon how many people are viewing your video.
Some content creators make videos that only 1000 people watch, others make videos that have millions of people watching them. As such, the amount of money that can be made from each video varies greatly, but can be great.
How To Create A Good CPM For My Channel?
First, you need to make videos that people want to watch. If you do not, then you won’t attract advertisers, and you won’t make money.
The channels with the biggest views are ones that do topics on makeup and beauty, health, finance, and technology, however these areas are also very saturated with channels.
In the past, the biggest areas were gamers recording their own gameplay, so the top watched channels change regularly. As such, it might be best to find a niche to work within that is quite popular, but not too mainstream.
Another thing to do is to have regular, consistent content. People like Markiplier have been around for years successfully because they create regular bi-weekly content for their audience to watch.
If you rarely upload or inconsistently upload, people will not stay around to watch your content and will most likely forget about you.
If you do manage to get advertisers interested in your videos, do not over saturate them with advertisements. People scrolling through YouTube are tolerant of adverts, but they don’t necessarily want them there.
If you put too many adverts in a video, they will simply stop watching that video and go to another one, regardless of how much they enjoy your content.
There are also other things that can affect CPM beyond your control. One of the biggest is seasonal changes in watches, as depending on the time of year, people have more time to watch YouTube or other videos.
For example, watching YouTube spikes during the late summer months and the Christmas holidays.
This is because children are not in school during the summer holidays, so will be inundated with free time, and people spend Christmas away from work or with family – so they also have a lot of free time.
Therefore, you should be wary of thinking that your CPM will be consistent constantly.
CPM stands for ‘Cost per Mille’ or ‘Cost per 1000’ and it refers to the advertisers cost in putting a campaign of adverts on YouTube.
This is a useful metric for both the advertiser and the Content Creator displaying the advert, as they can work out how much they are going to be paid per 1000 views of the advert.