What are cost per view ads?

Anyone in the world of paid media advertising will know that sometimes, it feels like a minefield – emerging trends, new types of ads, and of course a growth in competitor activity. One thing advertisers inevitably have to navigate is knowing which form of advertising suits them best, in line with their goals.

Cost per view ads are no exception. And you may have heard this term, but perhaps you’re left thinking “what are cost per view ads?” Perhaps you’re not too sure what they are and/or when you should be using them. Luckily, this blog covers what these ads are and how they work, when they could be used, as well as their advantages and things to consider if you do implement them into your marketing strategy.

So, without further ado, let’s delve into all things cost per view ads…

What are cost per view ads?

Cost per view (CPV) ads are a form of performance-based advertising – advertisers only pay when a user views their ad. It’s popular for campaigns that focus on engaging users with visual content, so it’s therefore usually associated with video ads from promotional clips to brand awareness videos, and product demonstrations.

So, how about how CPV works? The person running the ads will set a cost per view, and this is usually a fixed amount. They’ll then only pay this when the ad has been watched for a specific period – this could be 30 seconds, or the full duration of the video. The benefit here is that advertisers only pay for true engagement, rather than just clicks and impressions which can sometimes lead to lower-quality interactions.

Because of their nature, CPV ads are most common on TikTok, Instagram, and Meta, where video content is prevalent. These platforms let advertisers target their audience based on certain behaviours, interests, and demographics, meaning that their CPV campaigns can be effective if done right.

When reporting on CPV, the key metrics tend to be views, impressions, and video views. The views pertain to the number of times the ad is viewed by users, whereas impressions are the number of times the ad shows up on a user’s screen. However, an impression doesn’t guarantee that the ad will be watched. As for video views, this is the most specific metric for tracking success (i.e. how many users have watched the video ad for the specified amount of time).

How CPV ads differ from other advertising models

CPV ads are much different from other common models that are used in performance-based marketing. Other metrics include cost per thousand impressions (CPM), cost per click (CPC), and cost per acquisition (CPA) – all of which differ from CPV. Let’s explore how…

CPM: with this, advertisers pay for every 1,000 times their ad is served – this is regardless of whether users interact with it or not. As such, this metric hones in on visibility as opposed to engagement, so it’s ideal for campaigns that prioritise brand awareness but cannot guarantee that a user has interacted.

CPC: these charge advertisers when a user clicks on an ad. It’s still performance-based, but will only count actual clicks rather than engagement and views. As such, it works well for driving traffic but might not always be as effective for video content or brand-building campaigns.

CPA: these ads charge advertisers when someone completes a specific action from an ad, such as completing a purchase or signing up for something. This approach therefore focuses on conversions and outcomes as opposed to views and clicks. It’s effective for sales campaigns, but not so much for early-stage brand awareness campaigns.

In contrast to these methods, CPV ads specifically focus on video views and only charge for these, so it can be considered a much more targeted approach to measuring user engagement on video-driven campaigns.

Advantages of CPV ads and things to consider

CPV ads allow advertisers to reap many benefits, so they definitely could be a good option for marketers who want to further their ad spend, make sure it’s going to the right places, and improve their campaign outcomes. Let’s take a look at, if done well, some of the benefits that CPV ads can bring…

It can be a cost-effective form of advertising

Because you’re only paying for actual views, CPV ads ensure that your ad spend is only being spent on users who have actively engaged with the content, rather than spending your budget on impressions that may not even result in a valuable interaction for your brand.

Enhanced targeting

This type of ads gives advertisers the ability to reach a highly relevant audience – the platforms that these ads are common on offer advanced targeting features, so you can easily select to target specific demographics and interests. You could even target specific geographic locations, ensuring that your ads are shown to those that are most likely to be interested, especially if your offering is only available to those in a certain area.

With enhanced targeting, you improve your chances of having more engaged viewers, and therefore qualified leads, enhancing the impact and quality of your campaign.

Performance-based spending

You’re only spending money on users that are engaging with your content, so you’re less likely to waste budget on users that are disengaged. This type of ad can therefore better your value for money, especially when compared to other models that charge for clicks and impressions.

Better visibility 

CPV ads are best-placed for content-led campaigns, and videos in particular as we’ve already explored. Videos are increasing in popularity as a way to engage with an audience, and as a method for the audience to digest content. This, coupled with the fact that you’re only paying for views, ensures that the content gets in front of the right people and those that are actually engaging.

Increase brand awareness but with minimal waste 

CPV ads are great for brand awareness as they allow advertisers to pay for real engagement and get their brand out there, but without wasting spend. If you’re looking to build brand awareness without overspending, CPV ads could be something to consider.

Things to consider

So now we know that CPV ads have their benefits, but of course there are always two sides to every debate and there are things to consider with this method of advertising. If you do opt to use CPV ads, here are some of the things worth considering…

You risk paying for low-quality views

Of course, there’s always the potential that you’re going to pay for views that don’t actually result in any meaningful action being taken by the viewer, and for your brand. As an example – a user may accidentally click on the ad without genuinely watching it or having any intention of engaging.

This can result in wasted ad spend, as you’re still charged for the view even though there’s no real result or connection with the audience. Your video also needs to be extremely engaging to avoid users watching the ad briefly and then skipping it.

Potential to have high-costs in more competitive niches

In industries where there’s a lot of noise, CPV costs can escalate – as more advertisers come onto the scene and fight for the attention of their target audience, the cost per view may increase and particularly on platforms that are more competitive, like YouTube. Because of this competition, the target audience in question can become overwhelmed with lots of similar content, which can also contribute to the issue of high costs in high-demand sectors.

There’s no guarantee of quality engagement, and it’s hard to measure

In contrast to models like cost per click (CPC) and cost per acquisition (CPA), it’s hard to measure whether viewers are actually fully engaged with the content you’re producing. As an advertiser, you can’t control whether viewers are watching all of the ad, or are skipping it quickly. You may not get the level of interaction that you’re hoping for, but it’s so important to maximise your chances with engaging content.

When should businesses use CPV ads?

These ads are a unique and effective way to engage with a target audience, but of course they must be used in the right way and depending on your aims too. So, here are some considerations to make before you put them into action…

• You need to have a strong video content strategy to use CPV – because of the nature of cost per view, you must have content to view!
• With that in mind, CPV ads are ideal for brands that are promoting videos – these could be product demonstrations, or brand awareness campaigns. Video content is also extremely useful for those that are looking to build a connection with their audience and create a community. This type of ad can be a highly cost-effective way to gauge engagement.
• Your wider objectives/goals also need to be really clear, so you can ensure that integrating CPV ads into your wider digital strategy is the right move. CPV ads involve targeting relevant audience segments, so you need to be clear on who those are. You also need to ensure tha your video ads align with the brand’s message and objectives.
• You can pair CPV ads with other paid advertising methods such as CPC and CPA to tap into every area of the funnel from awareness, consideration, and conversions.
• You can use the data from your CPV ads to inform future strategy – e.g. if people aren’t engaging as much as you’d like, you can assess why that may be and implement the necessary changes.
• Certain sectors benefit from CPV ads more than others. Those that can be considered more visual will benefit more from engaging video content – think fashion, travel, entertainment, tech, and the automotive industry. The latter could include test drives or a tour of car features within video formats.
• However, for businesses that are heavily reliant on sales and quick conversions, and are wanting to drive immediate purchases, looking at a model like CPA and CPC may be better-suited to their goals.

Best practices for running CPV ads

Like any paid media advertising that’s got any fair shot at being successful, CPV ads require careful planning, ongoing optimisations, and attention to detail from concept to creation. To give your ads the best chance of performing, here are some best practices to keep in mind…

Make your video content engaging

If you’re paying for views, first you need to get those views. Then, once the user is enticed, you need to give them a reason to stay. All of this comes from creating high-quality and engaging video content. Not only should it look good and be visually appealing, but it should give users exactly what they need with the information shared. After all, you know yourself that you’d be more likely to engage with a video that offers value in some way.

To encourage people to watch your video, include a hook that grabs their attention. Make sure this is clear, aligns with your audience’s interests or challenges, and offers a clear call-to-action whether that’s visiting your website, subscribing to your newsletter, exploring more of your content.

Have clear goals and KPIs to help measure your success

Don’t go in blind – know what it is you’re wanting to achieve and establish a clear objective for your campaigns. Once you know this, you can then work out what your corresponding KPIs need to be, whether that’s engagement rate, average view duration, total view count, and so on. Knowing this can help you to measure the campaign’s effectiveness, guide your optimisations, and work on whatever needs to change to make improvements.

Target a clear audience

This is one of the most crucial components of CPV ads. You can use available tools across ad platforms like Google Ads, YouTube, and social media to carve out your audience based on behaviours, interests, and demographic groups. Tap into those groups likely to resonate with your content and what it is you stand for and offer as a brand. This can help to ensure that you’re only paying for views from genuinely interested viewers for better engagement and ROI.

Monitor, test, and optimise

Once your campaigns are live, keep a close eye on their performance and analyse your key metrics regularly to understand how well the videos are performing. Alongside this, you could look at A/B testing variations of your videos, CTAs, and targeting to see what works best. This may also include experimenting with video lengths and key messaging.

If you have test results to lean into, then make changes based on this and if certain videos are underperforming, look at how to improve. Then, adjust your campaigns in real time, optimise for better results, and ensure you aren’t wasting time and budget on low-performing ads.

Still need some assistance with cost per view ads?

We hope that this overview has provided you with further insight on cost per view ads. If you’re still wanting some further information on how they could work for your business, or if you want the management of these ads to be delegated to experts so that you can spend your time elsewhere, then get in touch with our award-winning team.

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