Video Ads: A Little Budget Goes a Long Way

When we talk about online video, it’s not just about pandas sneezing or double rainbows anymore. Online video has grown up – video podcasts, special features, cinematic previews, and yes, YouTubers, have made video king.

Since YouTube’s launch in 2006, better internet, better smartphones, and a global pandemic have propelled video viewership to record-setting numbers. Audiences are spending an average of 19 hours a week consuming online video content[1]. More video content is being uploaded in 30 days than what major television networks in the US have created in the past 30 years[2]. And there is no end in sight as more streaming services come online.

Chart showing the average weekly hours of online video viewership has risen from 10.5 in 2018 to 20 in 2022.

As a business owner, you want to reach as many potential customers as possible, in the most cost-effective way. Not only does online video offer reach but advanced targeting options and new brand safety measures make this a no-brainer for digital marketers.

But, it is cost effective?

The short answer is that it depends. Video marketing can run the gamut – everything from user-generated content (UGC) to six-figure, TV-quality production. There are two key cost centers when budgeting for video marketing – the cost to run advertising and the cost to produce the assets.

Cost to Run Video Ads

The reach opportunity across digital video gives marketers access to billions of users worldwide. That kind of access means advertising is cost-effective, and we don’t have to worry about overlap and high frequency rates.

Consider these averages:

  • On Facebook, the average cost per click (CPC) of a video ad is less than $1, compared to a $2+ CPC for single-image ads
  • YouTube ads average less than $0.50 cost per view
  • The average cost of reaching 100,000 viewers on YouTube is only $2,000

Every dollar a franchise owner invests can go a long way in a small territory. With only a $300-$500 budget on YouTube, a franchise owner can effectively reach 600-1,000 potential customers.

There are a number of factors that influence the costs of video advertising:

  • Your bid strategy – cost per click, cost per view, and cost per action to name a few
  • Your ad type – skippable videos, bumpers, or in-stream videos will have differing costs
  • Your target audience – the more highly targeted the audience, the more expensive it is to reach them
  • Your industry – industry rates vary; for example, the average CPC for the insurance industry was $18+ compared to less than $2 for the travel industry[3]

Cost to Produce the Assets

Video production can be as simple as UCG in a garage set up or as complex as actors in a production studio. The good news is that your video advertising efforts can be incredibly successful with video from both ends of that very large spectrum.

On average, 40% of marketers spent $0-$500 on video creation. The overwhelming majority spend less than $10,000[4].

On average, 40% of people spend $0-500 on a typical video, with the majority spending less than $10,000.

Ask yourself a few questions to determine the level of production value you truly need:

Where do I plan to place this video? User-generated content works well on social channels like Instagram and TikTok. However, if you want to test a connected TV buy on Hulu, you should opt for professional equipment that can deliver the proper specs – MP4 file with a 16:9 ratio at 1920×1080 resolution.

What equipment can I invest in? A good quality microphone will elevate any video production and there are several great microphones that plug-and-play with your smartphone. Spend some time researching lighting angles – a few strategically placed lights can turn any room into a studio. Rather than investing in talent, invest in your people. Your employees and your customers are already loyal to your brand and in many cases would love the opportunity to “go on record.”

What type of video content do I want to create? Event videos can be pulled together using footage from previous events highlighting interviews and presentations with text overlays. Round table interviews and employee or customer testimonials can be filmed in an office with a quality microphone. Product videos could come in the form of animated videos using still imagery.

All these options could be produced for less than $1,000 with some thought and careful planning.


This has most definitely been simplified, but not because it can’t be simple. The cost to run video advertising makes it one of the most cost-effective brand awareness drivers. With a small investment in equipment, you can start producing videos every month. The investment can truly pay for itself! But don’t take my word for it – 87% of marketers have reported good ROI using video and 93% of marketers say video helped boost their brand awareness[5].

93% of marketers say video has helped them increase brand awareness. 87% of marketers report strong ROI with video.







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