Understanding Cost Per Mille (CPM)
CPM represents "cost per mille," where "mille" translates to 1,000 in Latin, Italian, and French.
This term can be swapped with CPT, an acronym signifying "cost per thousand."
Cost per thousand (CPM) is the most common method for pricing web ads in digital marketing. The method relies on impressions, a metric that counts the number of digital views or engagements for a particular advertisement.
Impressions also are known as "ad views." Advertisers pay website owners a set fee for every 1,000 ad impressions.
Simply put, CPM tells you about how much an advertiser pays and wants to invest in certain types of content on YouTube for every set of 1,000 impressions or "views" their advertisement accumulates.
The higher the CPM, the easier it is for YouTubers to make money from their YouTube channel and their YouTube videos through ads and teaming up with brands.
If the content or display advertisement that's attached to a CPM campaign is high in quality, people will start talking about the brand
For video content creators and producers, attentiveness toward CPM is crucial, as it tells them the subjects that advertisers deem most valuable.
How to Calculate Your YouTube CPM
Everyone is curious about their video earnings, and YouTube's CPM calculations are quite straightforward.
You can calculate your YouTube ad revenue for a video by changing around these factors.
First divide the ad's cost by the total number of times it was shown, then multiply by 1000.
(Cost of ad / total impressions) x 1000
For instance, if your video gets 50,000 views and the CPM is $10, the total earnings would be $500.
This calculation won't give you exact amounts for each view or long-term income, but they'll give you a basic idea of your video's earnings.
It must be noted that the disadvantages of using CPM include incorrectly counting impressions due to duplicate views, ads that fail to load, and advertising fraud.
How to Find the Most Profitable YouTube Niches
Discovering your YouTube niche involves identifying the type of content you want to produce and share with your audience.
To find your YouTube niche, you can explore trending subjects, observe the strategies of accomplished YouTubers, and concentrate on generating content about subjects that captivate your interest and ignite your passion.
That said, it should be noted that determining the most profitable niches can be challenging. The earnings of a YouTube video also hinge on factors such as their strategy for monetization, how engaged their audience is, the quality of their content, and their geographical location.
What Makes a Niche Have Higher CPM?
Now that you can grasp the concepts of CPM, it's important to ask what drives a niche to become intensely competitive for advertisers.
Well, multiple aspects can influence your initial CPM set by advertisers:
Profitable Industries: Industries with substantial financial stakes often attract numerous advertisers competing for prominence. This fierce competition escalates the CPM. These industries allow businesses to invest significantly in advertising while still reaping substantial profits. Such niches generate substantial revenue through advertising.
For instance, some of the most competitive markets encompass:
Relationship Advice and Dating
However, these markets can be quite extensive.
Within these sectors, there exist specific coveted niches with exceptionally high CPMs. You can find these at the top of the hierarchy.
2. Geographic Influence: The location of your audience plays a role in determining CPM. YouTube charges advertisers more for targeting viewers in economically prosperous countries compared to those in less affluent regions, like certain parts of Latin America. Consequently, where your videos are watched significantly impacts your earnings.
3. Ad Viewing Duration: Some ads offer viewers the option to skip the advertisement. If the ad is skipped, the advertiser isn't charged, meaning you won't get paid.
4. Ad Inclusion in Views: Not every view is accompanied by an ad. If a specific view lacks an ad, you won't earn from it. Advertisers might select particular types of videos for their ads. Additionally, users who watch multiple videos consecutively might not see ads for all of them, leading to fewer paid views. Users may also utilize ad blockers or opt for YouTube's premium version, both of which reduce ad exposure.
Older audiences, who typically use fewer ad blockers and have higher average earnings, tend to result in a higher CPM.
All these elements substantially affect the income you receive for each viewed video.
Why Does CPM Vary Between Videos?
For starters, CPM rates vary between videos for many reasons such as the season, viewer location, change in ad styles, or during large holidays or events in specific industries.
Moreover, as we now know, as a partnered YouTuber who creates videos, you open the door for CPM advertisements, where advertisers pay a certain fee whenever someone views or clicks on their ad.
This payment amount depends on the level of competition among other advertisers who want their advertising displayed on your videos. They compete against each other to offer the highest bid to secure ad space.
Therefore, greater competition equals higher costs for ad placement, and higher costs for ad placement translate to increased earnings for you as the video creator.
This is why it is vital to craft videos that focus around keywords with significant advertising competition. SO, what is a keyword, you ask?
A keyword is a phrase people enter on YouTube or Google to seek content suggestions, especially in digital marketing.
Keywords in CPM advertising encompasses not only the title of your videos but also the phrases spoken within them, whether directly or indirectly.
An example would be if your video has the title: "Best YouTube Niches? Digital Marketing Niche Review," it's targeting these keywords:
Best YouTube Niches
Digital Marketing Niche Review
One should always consider Google Keyword Planner, a tool advertisers use to strategize the keywords for their advertising.
How to Find Niches with High CPM using Google Keyword
First go to the Google Keyword Planner tool.
Google is always making their processes seamless so when the planner tool has loaded, log in using your Google account.
Then you'll select "discover new keywords."
Enter your keyword and indicate the country you're in.
When you get the results, what matters is to measure the CPM rates you might earn from a video targeting that keyword, which is the top of page bid.
However, this figure isn't the direct CPM rates you'll receive. It just signifies the sum an advertiser must pay to display an ad once or for one click, based on their chosen approach.
Speaking of Google and ads, The Google Display Network is probably the best-known platform for bidding on display ads, so creating a Google Ads account wouldn't be a bad place to start as well.
10 Most Profitable YouTube Niches
If you're on the lookout for YouTube business concepts that will best engage with YouTube audiences, specializing in a niche is an essential requirement. Let's explore all the options for a top YouTube niche to help you in discovering the ideal niche for your YouTube channel.
Making Money Online
Creating video content related to strategies for making money online and earning income stands out as one of the most promising YouTube niches due to its universal appeal.
They have the opportunity to produce content about generating revenue through strategies to earn money across diverse social media platforms is prominent.
On a typical basis, creators within the making money online niche experience an average CPM of $13.00 Certain sub-niches prove to earn more money.
The YouTube niche for digital marketing continues to grow as long as businesses and marketers desire to gain insights into digital marketing strategies.
It's recommended to concentrate on a specific topic area aligned with your interests and, preferably, your expertise as the digital marketing world is so broad.
Here are several channel concepts fitting within this YouTube niche:
Facebook and Instagram marketing
Digital marketing secures the second-highest potential for income on YouTube. Channels focused around social media marketing, for instance, witnesses average CPM rates of $12.00.
Personal Finance and Investments
Personal finance covers valuable content on investing, stock trading, saving, budgeting, and other strategies to help individuals effectively handle their finances.
This niche stands out as a strong contender due to its lower competition and ample room for producing exceptionally distinctive video content.
YouTube channels that offer guidance on this category can see CPM rates reaching as high as $12.00.
Online Educational Content
Another profitable niche for a YouTube channel is to produce educational content. This stands as one of the more profitable niches, as audiences are constantly looking for tutorials and instructional videos.
If you have a specialized expertise in this field, sharing your knowledge to educate others serves as an effective avenue for more money earnings.
Creators within this niche can see CPM rates reaching about $10.00 on average.
Technology, Cars, and Gadgets
Another profitable niche surrounds all things, tech, cars, and gadgets.
However, the competition within this sphere is intense, given the multitude of channels discussing these subjects. Therefore, setting yourself apart through your content is crucial.
For instance, you could specialize in reviews, guides. Additionally, you might focus on creating videos that focus on the latest automotive news and addressing viewer questions concerning car maintenance.
Creators in the realm of photography can experience rates soaring to $7.00, whereas car-related channels tend to settle at an average CPM of $4.00. More generalized tech channels, on the other hand, can anticipate nearly $3.00 per 1,000 clicks.
Lifestyle content creators have maintained a strong presence on YouTube for a considerable time, and the lifestyle niche consistently ranks among the top categories due to its ability to adapt to crafting diverse content.
Within the lifestyle domain, creators dive into an array of topics that range from fashion to travel, as well as offering insights into their YouTube journey.
Typically, creators within the lifestyle niche can anticipate CPM rates averaging nearly $4.00.
Fashion and Try On Videos
Much like lifestyle niches, fashion and try-on videos dynamics have shifted as YouTube, Instagram, and TikTok creators are now holding the reins.
Fashion influencers on platforms like YouTube have gained significant popularity, with content like "try on hauls" contributing to their popularity.
These content creators can secure average CPM rates reaching about $3.00.
Cooking and Food
Let's think back to the pandemic... what were most people who were stuck at home doing?
Cooking! Therefore, cooking channels experienced a remarkable surge in popularity. Many people looked to YouTube for culinary inspiration or just to simply admire others culinary talents.
Your channel could focus on distinct cuisines, recipe videos, culinary advice, critiques of dining establishments, and more!
These types of channels prove to be quite profitable in terms of CPM rates, with an average of $2.00.
Fitness and Bodybuilding
Similarly to food channels, fitness and bodybuilding content has seen a significant rise in popularity.
Within this realm, you have the opportunity to craft follow-along fitness content like strength workouts, beginners’ yoga, and more.
Advertisers recognize that the average CPM rates is $1.60 within this niche.
Lastly, if you're contemplating different subjects for a YouTube channel, you may want to seriously consider the world of gaming.
And no, not sports games, or board games... but video games.
A plethora of gaming channels exist, such as strategic insights, game reviews, and more.
A number of the most-subscribed channels and top-earning YouTubers, including PewDiePie, have established themselves within the gaming niche.
On an average scale, creators operating within this domain witness CPM rates around $2.00.
Gaining a million or more subscribers on YouTube is not impossible, but that takes time.
Instead, it's crucial to spend your time on ensuring consistency, a persistent effort, and active engagement.
This includes choosing a fitting niche that aligns with your interests, your content creation skills, and your target audience. Now that you've reached the end of this blog, you may have a better idea of the niche to choose for your channel.
Equally important is dedicating time to interact with your audience, which fosters both subscriber growth and the quality necessary for YouTube monetization.