YouTube CPM vs RPM Explained (2023)

[00:00] so two of the most important metrics for

[00:01] any youtube creator to fully understand

[00:03] are their cpm and their rpm these

[00:05] metrics tell you a ton about your

[00:07] channel as a whole and determine how

[00:08] much you actually get paid on youtube

[00:10] however most creators don't actually

[00:11] understand how these metrics work so in

[00:13] this video i'm going to break them down

[00:14] very simply and show you how you can

[00:16] actually use them to your advantage to

[00:17] make more money on the youtube platform

[00:19] so starting off what is your youtube cp

[00:22] at well this was actually the only

[00:23] metric we had as creators to figure out

[00:25] how much we were getting paid on youtube

[00:27] until about mid 2020 when rpm was

[00:29] actually rolled out now cpm measures how

[00:32] much advertisers are actually paying

[00:34] google to get in front of your videos on

[00:36] the youtube platform see because youtube

[00:38] ads run as an auction okay so the more

[00:40] bidders there are and the more demand

[00:42] there is for ad space on a particular

[00:43] video the higher the price is going to

[00:45] be and the more the creator is going to

[00:47] make that drives the cpm up higher and

[00:49] higher when there are more people

[00:50] bidding for that same ad spot now cpm

[00:53] stands for cost per mil and it's the

[00:54] cost that the advertiser actually pays

[00:56] for 1 000 impressions on your channel

[00:59] now an impression is anytime someone

[01:01] sees an ad on one of your videos so to

[01:03] break that all down okay your cost per

[01:05] mil your cpm is driven by an auction

[01:08] process on your channel where

[01:09] advertisers are bidding against each

[01:10] other the higher the bids go the higher

[01:12] the cpm goes and the more money you take

[01:14] home in your pocket now youtube is gonna

[01:15] be taking a 45 cut of all of this money

[01:18] so your cpm is not how much money you

[01:20] are actually making it is before

[01:22] youtube's cut comes into play so for

[01:24] example 1 000 views on a 100 cpm channel

[01:27] would translate to 55 in your pocket as

[01:30] the creator and 45 of those dollars

[01:32] going to youtube however creators wanted

[01:33] a better metric to understand how much

[01:34] money they were actually making and so

[01:36] that's how the rpm metric came around

[01:38] which we'll get to in just a little bit

[01:39] now a common question a lot of newer

[01:41] youtubers have is what is a good cpm

[01:43] well it's a common question but there is

[01:44] no firm answer on this because your cpm

[01:46] depends on a whole number of factors

[01:49] this includes your audience demographics

[01:50] the topics of your videos and even

[01:52] whether or not you swear in your content

[01:54] say because all of these factors

[01:55] influence how much companies are

[01:57] actually willing to pay for ads on your

[01:59] channel now the average us cpm is

[02:01] anywhere from six dollars to eight

[02:03] dollars as of the recording of this

[02:05] video personally my cpm is closer to

[02:07] about 25 to 35

[02:09] because i'm making videos on finance

[02:11] taxes and things that advertisers are

[02:13] more willing to pay to get in front of

[02:15] my audience versus something like a

[02:17] gaming channel where the demand for

[02:18] those ads is a little bit lower because

[02:20] they're not quite as targeted at a

[02:22] particular audience but that being said

[02:24] there are some methods you can use to

[02:25] actually increase your cpm so let's dive

[02:27] into three of the most effective methods

[02:28] you can use right now now in the past

[02:30] there were a number of scares on youtube

[02:32] about very unsafe content being posted

[02:34] to the platform and advertisers having

[02:36] their ads shown before this unsafe

[02:38] content very bad for brands brands do

[02:40] not want to associate themselves with

[02:42] that type of content so brands have

[02:44] gotten a lot more careful with the

[02:45] videos that actually put ads on within

[02:47] the youtube platform so that being said

[02:48] if you swear in your videos you have a

[02:50] smaller pool of advertisers willing to

[02:52] put their ads on your videos because a

[02:53] lot of brands are trying to be family

[02:55] friendly trying to appeal to a younger

[02:57] audience they don't want to put their

[02:58] ads on videos of people who swear same

[03:00] thing if you're talking about illegal

[03:01] substances a lot of brands don't want to

[03:02] be associated with that so you're really

[03:04] reducing your pool of available

[03:06] advertisers when you talk about these

[03:07] particular topics now the next method

[03:09] you can use to increase your cpm is to

[03:11] target high cpm countries see because

[03:13] advertisers are willing to pay a very

[03:14] different amount of money for 1 000

[03:16] views in the us versus 1 000 views in

[03:18] india and this is actually why many

[03:20] international creators choose to make

[03:21] their videos in english both to appeal

[03:23] to a broader audience but then also to

[03:26] potentially capitalize on those higher

[03:28] cpms than they would get if they were

[03:29] making videos in their native language

[03:31] for some context here some of the

[03:32] highest cpm countries are the us the uk

[03:35] australia and the united arab emirates

[03:37] okay so speaking english can potentially

[03:39] give you a huge leg up compared to

[03:40] whatever country you are in maybe the

[03:41] cpms are a lot lower there so if you can

[03:43] appeal to an english-speaking audience a

[03:46] lot of times that can increase your cpm

[03:48] now the third method you can use to

[03:49] actually increase your cpm is to choose

[03:51] a desirable niche now most creators

[03:53] already have a niche and most of them

[03:54] didn't choose that niche based on the

[03:56] cpm they chose it based on something

[03:58] that they were actually passionate about

[03:59] and interested in that's why most

[04:01] creators get into this because they

[04:02] actually want to talk about stuff that

[04:03] they are interested in but that being

[04:05] said there are some ways to slightly

[04:07] tweak your niche in order to capitalize

[04:09] on a dramatically higher cpm here's a

[04:11] quick example so like i said before

[04:13] entertainment gaming channels typically

[04:14] have a very low cpm because they're

[04:16] appealing to a very broad audience

[04:18] advertisers can't get as targeted with

[04:20] the particular ads that they're showing

[04:21] and a lot of these viewers are actually

[04:22] on the younger side and might not even

[04:24] have the money to buy their products now

[04:25] business and entrepreneurship channels

[04:27] typically have much higher cpms because

[04:29] advertisers can really target this

[04:30] audience and this audience typically has

[04:31] more money to spend than the typical

[04:33] viewer of a gaming channel so if you had

[04:35] seen an entertainment channel that

[04:36] focused on doing different challenges

[04:38] you could potentially weave in more

[04:39] business and entrepreneurship maybe some

[04:41] make money challenges in order to

[04:43] capitalize on the higher business and

[04:44] entrepreneurship cpm while also staying

[04:47] true to your niche which is

[04:48] entertainment and doing different

[04:50] challenges so if you've just kind of

[04:51] told yourself well i'm just in a low cpm

[04:53] niche that's not necessarily the case

[04:54] and there are ways for you to tweak what

[04:56] you're doing just a little bit to really

[04:57] dramatically increase your pool of

[04:59] advertisers that want to get in front of

[05:01] your audience but that being said

[05:03] there's this constant balance between

[05:04] your potential audience size and your

[05:06] cpm because with a gaming channel or a

[05:08] general entertainment channel a mrb's

[05:10] channel things like that there's

[05:11] generally a much broader appeal for that

[05:13] content okay like mr beast is pulling 50

[05:15] million views of video i'm not gonna get

[05:17] 50 million views on a video talking

[05:18] about taxes for youtube okay so you have

[05:20] to kind of balance that and see okay i'm

[05:22] probably getting a much higher cpm than

[05:24] mr beast is but he's getting tens of

[05:26] millions of views on his videos so even

[05:28] if you do have a low cpm niche it's

[05:30] still possible to make a significant

[05:32] amount of money because you can reach a

[05:33] much wider audience with that type of

[05:35] content but now let's dive into what

[05:37] your youtube rpm actually is well this

[05:40] number actually describes how much you

[05:41] as the creator are making this takes

[05:43] into account youtube's 45 cut of your

[05:45] adsense income and as a result it's

[05:47] typically lower than your cpf now i say

[05:49] typically lower because there are

[05:51] certain cases where your rpm may

[05:53] actually be higher for your cpm on a

[05:55] particular video or on a collection of

[05:57] videos and i'll have more on that in

[05:59] just a second so rpm stands for revenue

[06:01] per mil and represents the amount of

[06:03] money you are making per 1000 views on

[06:06] your channel now this includes other

[06:07] things other than just your youtube

[06:09] adsense things like super chats channel

[06:11] memberships and your youtube premium

[06:13] revenue and so if these additional

[06:14] income streams are significant enough

[06:16] they can potentially push your rpm above

[06:18] your cpm and i've seen that with a

[06:19] couple of my clients channels from time

[06:21] to time they'll get a really high

[06:23] performing video that will have an rpm

[06:25] actually higher than the cpm typically

[06:27] happens with like live streams where you

[06:28] get a lot of super chats but for the

[06:30] most part your cpm is typically going to

[06:32] be higher than your rpm now quick

[06:34] example a 5 rpm means that for every 1

[06:36] 000 views on your channel you are taking

[06:38] home five dollars in your pocket so when

[06:40] you're looking at your youtube cpm

[06:41] versus your rpm both of these are very

[06:43] important metrics for creators to know

[06:45] your rpm is typically going gonna be

[06:47] more important though because that is

[06:48] focused on how much money you are

[06:49] actually taking home at the end of the

[06:51] month that's because it factors in

[06:52] youtube's split of the ad revenue and a

[06:54] bunch of other income sources that you

[06:56] can make on the youtube platform now

[06:57] keep in mind though that neither of

[06:58] these metrics takes into account any

[06:59] other income streams you're doing

[07:01] outside of the youtube platform things

[07:02] like affiliate marketing brand deals

[07:04] sponsors all of that good stuff so it's

[07:06] gonna be useful to continue to

[07:07] experiment on your channel and see how

[07:08] you can improve both of these metrics

[07:10] over time so now that you know how your

[07:11] youtube cpm and your rpm work the next

[07:13] thing you should do is check out this

[07:14] video over here where i break down

[07:15] exactly how to get sponsors on youtube

[07:17] my step-by-step process that i've used

[07:19] for myself and for dozens of clients to

[07:21] land them sponsorship deals on the

[07:22] youtube platform it's actually a lot

[07:24] easier than most creators things so

[07:25] check out this video and i'll see you

[07:27] over there