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How to Get Started with YouTube Pre-Roll Ads
The Agents of Change

Currently one of the strongest – and often untapped – digital marketing opportunities is YouTube pre-roll advertising. You know them as those 5-30 second videos that run before the video you want to watch, sometimes giving you the option to “skip it” and go straight to your video. Sure, some people can find them annoying, but if you use them in a way that is found to be interesting or helpful, you could be nurturing a future customer.

Pre-roll ads are a great way to build brand awareness and drive website traffic, all for a relatively reasonable price. Plus, these types of adds have shown to provide a more immediate ROI since they focus on  getting people who are ready to buy. Of course, a lot of that is in the finesse of how good you were at targeting your ideal audience.



Rich: Jace Vernon was raised in a small farm town in Utah where his parents gave him an excellent start in life. He learned to work at a young age and acquired a lot of skills that would help him in business. He co-founded the first whiteboard animation company called YDraw in 2011. It took off and became part of the INC 5000. Later he started a video marketing agency called Marketing Hy. Both continue to innovate in the video marketing space. His clients include Amazon, Disney, Oracle, Ford, and many small businesses.

Jace is an online marketing expert and business owner. He created three multi-million dollar businesses. He loves to share his expertise. He’s given presentations at PubCon, SMX, Affiliate Marketing Summit, Digital Marketing, and more. His passion is helping others grow their businesses with video ads. Jace, welcome to the show. 

Jace: What’s up, Rich?

Rich: Alright so today we’re going to be talking all about pre-roll ads at YouTube. For those people playing at home, it’s those videos that appear before we get to see the video of how to roll sushi or all the Easter eggs we might have missed in the new Star Wars movie. Jace, why do you feel these ads – these pre-roll ads – are a good idea for marketers?

Jace: Well there’s a couple reasons. So like you mentioned in the bio – which thanks, it sounds  a lot better than I really am – so basically on the pre-roll, whenever I go speak at conferences like PubCon this year, I was speaking and the first question I always ask is, “How many of you guys are running video ads on YouTube?” Nobody’s hands go up. And then I ask, “How many of you are running Facebook ads?” Everyone is running Facebook ads, Instagram ads. But video ads, you’ve got your big companies like Geico and those guys doing them, but there’s been some huge success on YouTube video ads, but people just aren’t doing it.

So in 2018 I think it’s going to be a big jump. People are going to jump on board with the whole YouTube thing. And Google, their platform is getting better, they’re getting really good at targeting those people on YouTube, becoming almost like search. So we’ll see.

Rich: Alright. Well let’s dig a little bit deeper. One of the things I’m most curious about, you mentioned Geico, are there certain types of businesses that you’ve worked with that have seen more success with pre-roll ads or less success with pre-roll ads?

Jace: Yes, actually. So it depends on their niche. A company like Geico they have billions of dollars, they’re just going to blast you with branding. But most small businesses can’t afford to do that. So if you’re a small business – like guitar tutorials – and if you want to teach guitar lessons that’s a really good niche. Piano lessons, good niche. Insurance, real estate agents, I mean small businesses it’s just a matter of picking the right videos to play on. That’s the key. You just have to build the right campaign for your niche but most will work on YouTube.

Rich: Ok. Earlier you mentioned “targeting”, let’s talk a little bit about that. Facebook seems to know everything about us, what kind of targeting can we do on YouTube?

Jace: So I focus on four places. So the first one is “placement”. That’s the first one everyone should do. What that is is you pick the exact video you want to play on. So let’s assume you’re a real estate agent in California. What you can do is you can go to YouTube, you Google “real estate agent videos” or “property videos California”, and then you put those exact videos in on the platform and you can run your ad in front of them. And you know they’re your target audience. So that’s the first one, placement.

Rich: So that’s really interesting that you say that because I’ve been researching Bitcoin for a segment I’m doing on a local TV show, and every video that I went to about Bitcoin, there was always a pre-roll video that was specifically about Bitcoin or mining there was always a pre-roll video specifically about Udemy doing a course on Bitcoin, and that sort of thing. So that sounds like they were doing some sort of placement targeting.

Jace: Exactly. And Udemy is actually pretty good at it, they have some good campaigns running. When you were looking at cryptocurrencies did you see some guy from India?

Rich: There were a few. There were people from all over the world into the cryptocurrencies.

Jace: And actually it’s funny, the cryptocurrency world has picked up big time on video ads and YouTube ads.

Rich: Probably because people want to watch those videos, they’re interested, they want to make a lot of money. A lot of people see it as a get rich quick scheme so they want to jump in right now, so I can definitely see where people would be interested in and not care where that information is coming from so that pre-roll ad maybe isn’t an interruption or a barrier to get to the content. It actually is the content. 

Jace: Yeah, you’re right.

Rich: Interesting. Alright, so a question, can I target just specific videos or can I target every video by a specific video channel? So if I see that my real estate competitor had 10 videos out there and was allowing ads on each one of them. I wouldn’t have to go out and pick 10 of those videos or 100 of those videos. I could just say I want to target “Portland, Maine real estate”, and then I’d be able to just get in front of all their video ads?

Jace: Yeah, you have their channel. So when you do a search on the platform it will give you the channels that are available. So you type in the keyword, “real estate”. It will give you the keywords, the channels that are available to market on, it will give you the videos that are available to market on, it will give you the website and the apps and then the Google network, some other channels on their networks.

So it gives you the options, a lot of times they’re not great, so if you really want to get good you got to go out there and handpick.

Rich: Right, do your homework.

Jace: Yeah, do your homework. So that’s the first one. Placement campaigns, that’s the way to go at first. And then after that you have other targeting options like keywords. You can go to Google and say, “I want these keywords, I want my videos to show up for these keywords”.

Rich: Where are they getting the keywords from? Are these coming from the titles, from the tags that people are using, or is it just kind of the same way that Google looks at a webpage and understands what the keywords are for that page?

Jace: No, no, no. So the keyword there – your keywords that you want to go after – so if you’re in the addiction recovery space you type in “addiction”. Well you want your video to pop up in the top. There’s an ad in the display network, so if you target by keyword it’s the keywords that you want to show up for at the top.

Rich: Alright, so let me make sure I understand this. So placement campaigns is a pre-roll before the video starts that I can tag either channels or specific videos to roll in front of. Keywords – if I’m understanding you correctly – is when I do a search on “addiction” or whatever it might be, and when they give me the list of 20 videos that might be relevant for me there’s always that sponsored ad at the top. So you’re saying that for keywords, that’s where I want to appear as opposed to a pre-roll ad?

Jace: Yup.

Rich: Ok, cool.

Jace: And that’s in display. So you have the pre-roll and you have in display ads, those are the two different ones. It’s called “Discovery” now, it used to be “in display” but now it’s called “YouTube Discovery”.

Then the other types of targeting we like to do is remarketing. So you can remarket anyone who’s been visiting your site, you can remarket to people who’s watched your videos. So if somebody’s watched one of your videos and you want to show them another video, you can do that. I love remarketing.

And then the last one is YouTube Infinity and In-Market Audiences. So Google is tracking everything you’re doing, and you can just say, “Ok Google, I want to target anyone in the car space who’s looking for cars”, and they’ll run your ad in front of people who are looking for cars.

Rich: Whether or not the video is about cars, whether or not the keyword search was about cars, YouTube/Google knows that you’re in the market for cars – just like Facebook does – and they’re going to show the correct ads.

Jace: Exactly.

Rich: So those are placement campaigns which is pre-roll. Keywords – which is more of like YouTube Discovery – that ad at the top of the search results. Remarketing, so after they watch one ad then we can show them…is it a preview for our ad, is it more like Discovery?

Jace: Pre-roll, it’s a pre-roll. So remarketing, they’ve visited your site or watched any of your videos, and then roll them a pre-roll ad.

Rich: Ok, perfect. And then also then there’s the YouTube Infinity, is that what it’s called?

Jace: Yeah. They’re called Infinity and then In-Market.

Rich: Ok, and that’s just because Google knows as much about it as Facebook. Alright. So my head is just spinning right now, because of course I always have my Agents of Change Conference in September so immediately I’m thinking about the placement campaign. I could go out and find people who are geographically aligned with me – and I assume I can do this. So let’s say I want to get in front of videos produced by other social media and SEO producers, and HubSpots, and Social Media Examiners, and then I want to also focus it only on people that are say an hour drive from me. Is that another filter that I can put on top of that?

Jace: Yup. Demographics, location, parent, non-parent, age groups, those are all other filters that you can use.

Rich: Excellent. And then keywords I can definitely see if somebody is searching for “social media conference”, “seo conference”, that would be great. Remarketing certainly if somebody goes to my website for some crazy reason and they don’t buy a ticket, certainly I can show them highlights from last year. And if somebody is in the market to get better at social media I guess I can also target those people as well. A lot of good opportunities. I’m sure people that are listening now can see how that could work for their business. So now I’m super excited about this, how do I actually buy the ads? Is this a bidding platform like AdWords or Facebook Ads?

Jace: Yes, it is AdWords, that’s what it is. You go into AdWords and it is all based off bid. You should average around 8-15 cents per view. That should be about your cost. Now a view is considered 30 seconds. They have to watch your video for 30 seconds and that’s a view. So if they skip the ad, you don’t have to pay anything. That’s something really cool about YouTube ads is it’s free branding. If you’re up in front of them and they’re always skipping your ad, eventually they’re going to keep your ad if it’s good.

Rich: What if my ad isn’t 30 seconds long? Do I just get to advertise for free forever?

Jace: No. If it’s not 30 seconds long you get charged every time that thing plays, so make sure you push it past 30 seconds. Look at the Geicos, they can afford to run 14 second ads, because every time that plays they’re getting charged. Well you don’t want that. You want to get a qualified person so make it past 30 seconds so that everyone has a chance to skip it.

Rich: Now in AdWords I know that there’s a quality score, so that even if somebody is out bidding you, if you’re ad is more likely to get clicked on you might rank higher than them in that algorithm. I’m guessing it must be similar. If I have a pre-roll that’s a minute long but no one ever clicks on it, YouTube’s not making any money and after a while they’re going to want to stop running that in favor of somebody that is getting clicks and is generating money, correct?

Jace: No.

Rich: No?

Jace: There’s a long ways they have to go on the YouTube ad platform. They’re not that sophisticated yet. Just this last year so many things have changed with it they’re getting way more aggressive. So eventually I think it’ll be there, but right now it’s a matter of upping your bid. If your videos isn’t playing, up your bid and you’ll be there.

Rich: Alright. Do you recommend a monthly budget for anybody that’s just starting out?

Jace: The nice thing is they can start at $10 a day. I always tell people if you can’t afford to go $2,000 a month, maybe wait. But some people do $10 a day.

So I’m able to get leads on YouTube, I’ve seen it range from $2 to up to $70 a lead. Some companies will do that all day long. I’ll tell you my average cost per lead for my own companies is around $7-$10 per lead, is what I get on YouTube.

Rich: Nice. Now I’ve started to notice on some of the longer videos I’m watching – I’m a comic book geek – and some of the videos that go into depth with comics can go a good 20-30 minutes long. I notice now about every 7 minutes or so I get an in-roll ad, is that also an option we can choose as well?

Jace: Yeah. If you choose that video and want to play on that video, you can be one of those ads in the middle of the video. And not to go off YouTube, but Facebook just started that this year. They are doing pre-roll ads, and in-roll ads on their videos.

Rich: I was just reading about that the other day, so that will be interesting to see. What other choices might we want to make when we’re making our ads? Is there anything else we want to think about either in terms of the targeting or the length of ads that we should keep in mind?

Jace: Yeah, well the video is a big deal. If you’re going to do YouTube ads, you need to make sure you’re going to have a couple of things in the video for it to be successful. One, within that first 5 seconds of your video you have to grab their attention. I see a lot of people do a video ad and the first 5-10 seconds is their logo appearing with some nice music. Or I’ve had financial guys that have nothing but disclaimers for the first 5-10 seconds. Those aren’t going to work, you have to come out with something that grabs their attention within the first 5-10 seconds.

Then you need to show them, here’s your problem, here’s your solution, and then you have to give them a strong call to action. So tell them exactly what you want them to do. You want them to click off the video, go to your website, and sign up. Don’t just end your video without giving them a call to action to do something. 

Rich: So this is many ways for small businesses, a more effective ad is definitely more of an infomercial, that style where you’re really looking to close the sale within that 30 seconds.

Jace: Oh yeah. And we’ve done some fun things where you can actually do an introduction, give them kind of a call to action in the first 15 seconds. If they will click off and go to your website, well that’s free.

Rich: I don’t get that at all. How is that free if my ad is effective?

Jace: Well if it takes them off before that 30 seconds, you’re not going to get charged. So we’ve done that before where you can take them off, it could be very effective if you can get them off that channel to your website or landing page before the 15 seconds, then great, you’re not going to get charged. But you still extend it out past 30 seconds and then maybe start up again, but there’s a lot of different things that you can do with the actual video.

Rich: Sounds good. Now it sounds like you’ve done a lot of work with different types of ads. What kind of ads get people to take notice and take action? And when you are creating ads for YouTube, are you repurposing other content or are you creating something specific for the platform?

Jace: We do not like to repurpose. So we’ve had companies come to us and say they’ve got a commercial and then they want to throw that commercial on YouTube – a TV commercial – it really doesn’t work. So we like to create video specific for YouTube.

Rich: Now I’m sure a lot of people are hearing that and saying, “Oh damn, I was totally going to use this video that my local TV station created for me”. Now they’re thinking these video ads are just going to be way too much work. What would you say to those people?

Jace: A good example, I don’t know if you guys have heard of Tai Lopez? Somebody has had to have heard of Tai Lopez. What he does is he runs huge amounts of video ads and he just pulls out his iPhone and shoots himself on his iPhone. And that’s the thing, it doesn’t need to be elaborate, it doesn’t need to be expensive, it just needs to have those things where it grabs attention, shows people that you’re going to solve their problem, and then you give them a call to action. That’s it. Don’t spend huge amounts.

Now if you have a big budget if you’re a big corporation, Purple does a really good job. They spend huge amounts on their video ads and they work great.

Rich: Alright. What are some of the mistakes that you’re seeing people make when they’re buying and creating these ads?

Jace: Ok, number one, they let Google decide where they want to run the ads and they end up running their ads on things like music videos. So like a Taylor Swift music video that’s getting millions of views a day, that will burn your budget.

Kids videos, if you open up the door and accidentally run on Wheels on the Bus, your video is not going to be seen by your ideal audience. So another one is they don’t…I like to take mine off of mobile. I’ve noticed a lot of people don’t really like to watch your ads on mobile. Most of the time the volume is off, and so I’ll go on the ad platform and just say, “only play my ads on desktop”.

Rich: Ok, interesting.

Jace: So even though mobile is big, if you don’t have a big budget and you want to use your budget effectively, just go turn off mobile and only allow it on desktop.

Rich: Sounds good.

Jace: And the last mistake is not spending enough time on picking that target audience. You need to spend some time finding the exact videos you want to run on and the audience you want to target. 

Rich: Alright, so any suggestions, we’ve talked a lot about the goal here seems to be to get people off of YouTube and onto our landing page or website – correct me if I’m wrong – but that seems to be the big thing here? Do you have any suggestions or have you seen any best practices when it comes to creating landing pages off of YouTube pre-roll ads?

Jace: No. I mean it needs to be best practices of every landing page. Whatever your ad is, whatever your call to action, whatever your headline is, when they hit that landing page it needs to match. They need to have the same feel, the same call to action, and so you don’t want to drive them, a lot of people just drive them to their homepage. No, drive them to a landing page that lines up with that actual ad.

Rich: Do you ever have an ad available to watch right there as well, just in case they skipped over before the end of it?  

Jace: I don’t. Like I don’t have the same video playing or the ad there. But I’ve seen a very effective one and what he did was he gave them a choice. He was a guitar guy and he created a video and he gave them a choice to say, “Are you a beginner or are you an expert? Click on one of these.” And when they clicked on them, they went to the landing page that basically had another video that was separated out from the beginner to the expert. So he had two different videos and two different landing pages.

Rich: Almost like a “choose your own adventure”.

Jace: Yeah.

Rich: Excellent. Jace this has been fantastic, I definitely am excited to go play around with some YouTube ads. Where can we learn more about you and find you online? 

Jace: You can visit marketinghy.com, there’s some stuff there. Ydraw.com, where we create videos. And then I have put tutorial videos on my YouTube channel, actually I just shot a new one this morning on basically what we talked about here. So if they want to go on the YouTube channel MarketingHy, they can watch it.

Rich: Awesome. And we’ll of course as always have a full transcript of the show and all the links that Jace shared with us. Jace, thank you so much for stopping by today and sharing your expertise.

Jace: No problem, see you Rich.


Show Notes:

Jace Vernon knows how to effectively leverage YouTube ads to reach his ideal audience while still being cost effective. Check out his YouTube channel to see tutorials, and stop by one – or both – of his websites to learn how you can leverage the power of YouTube pre-roll ads for your business.

Rich Brooks is the President of flyte new media, a web design & digital marketing agency in Portland, Maine. He knows a thing or two about helping businesses grow by reaching their ideal customers, and to prove that, he puts on a yearly conference to inspire small businesses to achieve big success. You can also head on over to Twitter to check him out, and he just added “author” to his resume with his brand new book!