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Cost per view (CPV)

Cost per view (CPV)

Cost per view (CPV) is a pricing model for video ads that only charges you when a user watches your video.

What is CPV?

CPV stands for cost per view: it refers to a pricing model where an advertiser pays each time a user views their video ad. 

Don’t confuse this with the older meaning of CPV: it used to refer to something called adware, which operated without the internet and would bombard users with unwanted ads when they downloaded an application or software. Luckily, this practice is essentially extinct these days. 

Why do you need CPV? 

You can choose a cost-per-click (CPC) or a CPV model when running a video advertising campaign. 

CPC models are common, but you pay for every click on the ad, whether the viewer watched the entire video or not. With a CPV model, you can take a much more cost-effective approach. You only pay once the user watches the video’s duration, which varies depending on the platform you use. For example, Google’s view duration is 30 seconds of your ad, while Twitter’s default is 15 seconds. 

This CPV model means you don’t have to pay for everyone who happens upon your ad or clicks on it unintentionally. Instead, you can focus on your ideal audience and only pay when someone shows interest in the video ad and watches it. 

How to decide the maximum CPV bid amount to set

There are three things you need to keep in mind when determining your maximum bid: reach, budget, and spend.

First, look at your reach, which is the estimated number of users who could see your ad. Next, look at the maximum budget you could spend on your ads daily. And finally, determine how you want to spend that budget on each video ad view.

While a higher maximum bid amount will get you more views, it will take a larger portion of your budget. So consider what’s the priority for your company right now: keeping costs down, or getting as many views as possible.

How CPV affects ad rank

Keep in mind that your maximum bid amount also affects your ad rank. A higher maximum bid means a greater probability of the search engine displaying your ad. 

It also determines where your ad appears. Again, a higher bid results in better, more visible placement. 

What’s the difference between CPV from CPCV, CPI, and CPM?

CPV is just one of the advertising metrics you need to know about. The following can be used alongside it to give you a more rounded picture of your campaign effectiveness. 

CPM

Cost per mille (CPM)

Cost per mille (CPM) is an advertising model that charges the advertiser for every 1,000 impressions on their ad. It’s ideal for brand awareness and brand recognition campaigns, where you want to get your name in front of as many people as possible. 

CPCV

Cost per completed view (CPCV)

Cost per completed view (CPCV) is exactly what it sounds like — an advertising model that only charges the advertiser once the user has watched the entire video. 

While CPV and CPM offer cheaper ways to run top-of-the-funnel campaigns, CPCV is a much more effective way to measure actual engagement.

CPI

Cost per install (CPI)

Cost per install (CPI) helps to identify the acquisition cost of a mobile app campaign: how much does it cost to get users to download and install your app? You can use your CPI to narrow down and find your exact audience, and then run CPCV campaigns tailored to them.

How to calculate CPV: cost per view formula 

To calculate your CPV, you need to take the total advertising cost (or ad spend) and divide it by the total number of views. Here’s the formula:

Cost per view formula

Let’s say you spend $2,000 on your ads and receive 10,000 views. You would then calculate your CPV by doing the following:

CPV = $2,000/10,000

CPV = $0.2 or 20 cents per view.

Cost per view best practices — how to optimize and increase your CPV 

Before you can optimize your CPV, you need to understand what the ideal range is. 

A good CPV is typically between 3 and 30 cents. However, the exact amount depends entirely on your campaign type, industry, and audience. On the other hand, a bad CPV would be more than what your advertising budget allows. 

If you’re running ads for brand awareness, consider what you can afford to pay to have one person see your video. If you’re focused on conversion rates, on the other hand, measure your CPV alongside other metrics.

Measure CPV alongside other metrics

CPV in isolation won’t give you the full picture: you should consider other metrics, too, including CPM, CPI, and CPCV. Also, track your max bids and your actual installs or conversions. 

This comprehensive approach will help you understand what works, what doesn’t, and which campaigns you need to improve before you run out of cash. 

Optimize your video ad campaigns

When you’re spending money on a video ad campaign, you don’t want to leave things to chance. Instead, use video ad best practices to optimize your campaigns. 

Take the time to improve your ad targeting, landing pages, and keywords to best reach and connect with your audience. You should also use relevant tags and test each campaign to help improve campaign performance over time. 

Create high-quality and interesting videos

If you want people to watch your videos, it’s crucial to make them genuinely engaging and relevant. Invest in producing high-quality videos and continue testing different versions with your audience to find the perfect match.

Key takeaways

  • Cost per view (CPV) is an advertising model that charges the advertiser whenever a user watches an ad for a set duration.
  • You can calculate the CPV by dividing the total cost of your video ad by the total number of views.
  • CPV is essential for any video ad campaign, and you should monitor it alongside other metrics such as CPM, CPI, and CPCV.
  • To optimize your CPV, you should invest in creating engaging videos, test different versions with your audience and look at other metrics to see what works and what you need to change.
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