Understanding YouTube CPM in 2023

With more than two billion monthly active users, YouTube has become a powerful and even essential channel for advertising. Which means that if you are a YouTube creator, whose channel is eligible for monetization, there are plenty of opportunities to make money from the platform .

Here is everything you need to know about CPM in a few steps:

• What is CPM?
• What is RPM?
• How to improve CPM rates on your YouTube channel?

What is CPM?

Whether you’re a seasoned creator who’s been on YouTube for years, or you’re just getting started, CPM is an important metric to understand to ensure you’re maximizing YouTube’s potential as a revenue generator.

CPM, or cost per 1,000 impressions, is the amount of money an advertiser must pay YouTube for every 1,000 impressions their ads receive on a video. It is therefore an indicator that can vary depending on the amount paid by the advertiser to display his advertisement.

As on Google and other platforms, the price of advertising on YouTube depends on a series of different factors (auction price, type of advertising, etc.). For example, suppose an advertiser pays $10 for an ad and that ad has been viewed 5,000 times in your video. To calculate the CPM, you must divide 10 by 5000 = 0.002€, then multiply 0.002€ by 1000. Your CPM is therefore equal to 2€.

In other words, in addition to being tied to your revenue, CPM is a relevant indicator of the value of your content and helps you identify companies you might want to partner with in the future.

Highest CPM on YouTube

While CPM varies by country, the TSZ website reports a detailed list of CPM rates observed in 2021, of which here are the top 10:

For France, the average CPM rate is around €3.80.

However, despite being a key metric, the CPM metric is not designed for content creators but for advertisers.

For the broadcaster, it is above all a question of knowing how much the creator earns, and not necessarily knowing how much this or that advertiser pays. Of course, the ultimate revenue for the creator is calculated based on the CPM .

What is RPM?

For an advertiser who paid €10 for 5,000 impressions, your CPM is equal to €2. But that’s not the amount your video will earn you, since YouTube takes a percentage of the CPA (45%, to be exact). You will therefore only receive 45% of these €2.

Therefore, if you earn €2 in CPA with a video, you will collect €0.9. This sum is called RPM (Revenue Per Thousand Views): it is the income that you actually earn with the advertisements placed on your YouTube channel. This stat tells you how much revenue you generated per 1,000 views.

RPM is calculated by dividing the amount of your estimated revenue by the total number of views during the same period.

The RPM (or effective CPM) is therefore the average revenue generated per thousand advertising impressions. It is the most relevant metric for a content creator on YouTube.

What does the revenue estimated by the RPM include?

The estimated revenues include those generated by

• ads ;
• YouTube Premium;
• subscriptions;
• Super Chat messages;
• Super Stickers.

This is the amount that comes back to you after YouTube revenue sharing. The total number of views includes all views, including non-monetized views, but not those recorded in the YouTube Shorts player.

Since RPM is calculated by including your revenue share and includes non-monetized views, it is generally lower than CPM, which is based on plays. It is however by acting on the CPM that your RPM will increase, mechanically.

How to improve CPM rates on your YouTube channel?

To improve your CPM rates, you need to take care of every element of your YouTube channel that affects its monetization.

Take care of the metadata

Metadata is basically what will get a YouTube user to click and watch your video . They consist of the title, description, thumbnail, and tags used for the video.

If used correctly, they will work together to get you the most views on YouTube.

Find a catchy title

A catchy title may get you clicks, but it’s the content of the video that will keep a user watching it. Indeed, YouTube no longer only considers clicks/visits to determine the ranking of search results . The viewing time is also one of the most important parameters.

So make sure that the title of the video is catchy, but also matches the content of the video. Otherwise, if the user does not stay on your video long enough, the best title imaginable could be completely useless to you.

Provide a good description

The description is also essential: it is often read before the Internet user launches the video on YouTube. The description of your video must therefore perfectly reflect its content.

Think SEO with your tags

Tags, on the other hand, are useful for the function of searching and recommending related videos. For this reason, do not hesitate to add tags in your videos. Be careful though: they must be as relevant as possible.

Do not hesitate to use the most competitive keywords but do not neglect neighboring or even long tail keywords. They can also have an advantageous impact so that your video appears quickly on the search page of Internet users.

Choose attractive thumbnails

Thumbnails are the miniature visual windows, or “mini-posters” of each video on YouTube.

If you want your video to get more views, an attractive thumbnail is an important part of metadata. They need to be properly optimized to grab attention and make your video stand out from the crowd in the recommendation bar.

Increase viewing time

YouTube ‘s algorithm takes into account two factors to increase your visibility, both in search results and in the frequency with which your video will be suggested in the recommendation bar.

First, YouTube wants people to watch your channel content for as long as possible: if you upload a 20-minute video and someone watches it for 15 minutes, that’s great enough.

But that’s not all: YouTube measures the time spent by the user on its platform. Imagine that you are promoting your video on social networks, with the link to your video: people who click on your link will start a session. If they watch your video for 15 minutes, then bounce back and spend an hour on the YouTube platform, part of that hour will be credited to you.

So, if you increase the watch time, your videos will be more visible and you will see your channel growth on the rise!

Put more ads!

We tend to think that putting more ads is harmful to a channel, because we imagine that people are annoyed by these ads. In reality, an overwhelming majority of Internet users have nothing against advertising.

But above all, and this is an (open) “secret” that YouTube does not reveal to us, but that all people who have been working on YouTube for a while have understood: the more ads you put, the more you earn. money and more your video is recommended by the algorithm.

How is it possible ? The answer has actually already been given to you above: YouTube is a business. She therefore recommends the videos that bring her the most money, to the detriment of those that she hosts “for free”, without getting anything out of them.

Conclusion

You now have the keys to understanding and improving your CPM on YouTube!

If, however, you are having trouble increasing traffic to your videos and generating revenue, you can hire a YouTube expert to audit your channel. He can then advise you on how to improve the SEO of your videos and increase your audience.