YouTube ads aren't just for big companies — founders share 3 tips for using them to target customers and show off products

YouTube advertising can be a cost-effective way to show a company's value. It doesn't need to have a high production value to be effective.

• YouTube video ads allow businesses to target specific groups without spending a fortune.
• Video content doesn't need to be expensive or have a high production value to be effective. 
• YouTube's measurement tools can help businesses see which ads are having an impact.
• This article is part of "Marketing for Small Business," a series exploring the basics of marketing strategy for SBOs to earn new customers and grow their business.

Chris Orzechowski has tried "a little bit of everything" when it comes to advertising, and running video ads on YouTube is one of his favorite tactics.

"YouTube is just huge, and it's been exploding and hasn't stopped," the New Jersey-based marketing consultant and strategist told Insider.

YouTube's reach is well known; the company says 500 hours of video is uploaded to the platform every minute, and it's the second most-viewed website worldwide (Google is first). 

But for Orzechowski, who runs YouTube ad campaigns for his clients and his own business, 100 Year Brand, its biggest advantage over other social-media sites is that it is owned by Google's parent company, Alphabet.

"Google has so many data points that make it super useful for targeting ads, so YouTube is a really attractive medium," he said. The targeting also means small businesses don't need large marketing budgets to reach specific audiences.

Here, two small business leaders offer tips for using YouTube ads and explain how it benefits their companies. 

Target your most important audiences

Kenneth Burke, the vice president of marketing at the text-messaging software company Text Request, says YouTube ads help the organization target audiences in a cost-effective way.

The Chattanooga, Tennessee, company targets audiences similar to its existing clients, those in the market for software, and others, he said. Typically, they spend about $10 per thousand impressions and see high engagement with people clicking on their ads.

"There's an increasingly large business-minded audience there," he said. "If the messaging is clear, you'll get people coming to your website and interacting."

YouTube ads can also be targeted based on location, a business' search terms, and other factors, Orzechowski said. "The algorithm is very good at putting your ads in front of the right people at the right time," he said.

Ads can be targeted based on business goals as well, like increasing brand awareness, generating leads, or growing sales, according to YouTube.

You don't need video-production expertise 

Video ads often leave a lasting impression, Orzechowski said. The visuals and audio capture people's attention and enable businesses to demonstrate their products or explain their services in a more compelling way than photos and text.

"It just leaves a stronger imprint in your brain when you see something in video format, and maybe there's a good story behind it," he said. 

The ads don't need to be professionally produced. Orzechowski said he'd seen video ads created with smartphones generate just as much, if not more, engagement than highly polished ones. Less-polished content can even make businesses seem more authentic and relatable.

"You can get started in a very low-tech way and then experiment from there," he said, adding that keeping video ads to about a minute or less often worked best.

YouTube offers some ad-creation tools, such as an asset library with royalty-free music and images, and creative guides.

Burke said some of Text Request's YouTube ads were created in-house, though the company outsourced the production of an animated explainer video. Thirty-second ads have been ideal for the company, he added, to "get and hold somebody's attention, where we can still share a clear message that explains our value."

Measure the impact

YouTube provides measurement tools to help businesses track the effectiveness of their campaigns, such as who saw the ad, how many people clicked on it, who visited the advertiser's website, and the conversions it generated, like new sales, downloads, or email sign-ups.

It can take time to see results, however. Burke suggested letting campaigns run for a couple of months to gather enough data to show their impact. Then, experiment to find the right type of video content and targeting approach to meet your goals.

Orzechowski says small businesses too often overlook YouTube as an advertising platform because they don't feel comfortable making videos or being on camera. But running an ad campaign on the platform can be an inexpensive experiment; he said spending $30 to $150 a day could offer a return on investment. 

"If you're having fun making the ad," Orzechowski said, "people will probably have fun watching it."