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Original Article Provided by Google Support; Cost Per View Marketing

How to decide what CPV bid amount to set

How do you know what CPV to set? You can base this amount on the traffic forecasting data we present as you select your targeting settings and max CPV when building a new campaign (or managing your targeting groups later). You can also base this on what you know about your business and the value of a sale.  For example, if you sell handcrafted jewelry pieces that cost US$1,000 each, one new customer is probably worth more than if you sell books for US$8.00. You may set a CPV of $50 for your jewelry ads, and a CPV of $1.00 for your books.

How to set your CPV bid

You can set your max CPV bid when setting up your campaign as you select your targeting groups. You can select a default max CPV bid for all ads associated with a targeting group, or define an individual CPV bid per TrueView video ad format. You can also set a unique bid per targeting type (placements, keywords, topics, etc.).

Two other elements affect the actual CPV you pay: Quality Score and ad rank. Your Quality Score is a measure of how relevant your ad is to a customer, and includes multiple performance factors like view rates. Once your Quality Score is determined, it's multiplied by your max CPV bid to rank your ads among other advertisers. That's called Ad Rank.

Once all ads have been ranked, the actual CPV for your ad is based on an equation that considers the ad rank of the bidder below you and your Quality Score.

The highest ranked ad wins the highest placement on the page, and the cost for a video play for this ad (the Actual CPV) will be just above the CPV bid of the next ranking ad.

Cost-per-view (CPV)

Cost-per-view (CPV) bidding is the default way to set the price you'll pay for your AdWords video ads (when created with AdWords for video). While traditional display ads charge you for impressions, with CPV you pay only when a viewer watches your video.

With traditional online text ads or image ads, customers on the web may see your ad, read its text, and click your URL to go directly to your site. This type of interaction doesn't take interactive content like video ads into account. With CPV bidding, you won't be charged for just an impression or a video interaction click on your ad.

With AdWords for video reporting, you're able to evaluate how engaged viewers are with your content, where they choose to watch your videos, and when they drop off from watching your content.

YOUR AD IS INITIATED
Your entire website will be displayed as a pop-up or an interstitial (an in between website) over the targeted website, driving the users directly to your website and finding your product or service over your competitors.

YOUR AD IS INITIATED
Your entire website will be displayed as a pop-up or an interstitial (an in between website) over the targeted website, driving the users directly to your website and finding your product or service over your competitors.

TERMS ARE SEARCHED

We apply the research to match your targeted relevant keywords for products and services they search. A user enters relevant keywords related to your product or service within any search box like Google Search, Bing Search, Yahoo Search.

Contextual Advertising
Contextual Advertising

Contextual advertising is a form of targeted advertising for advertisements appearing on websites or other media, such as content displayed in mobile browsers. The advertisements themselves are selected and served by automated systems based on the identity of the user and the content displayed. Contextual advertising has made a major impact on earnings of many websites. Because the advertisements are more targeted, they are more likely to be clicked, thus generating revenue for the owner of the website (and the server of the advertisement). A large part of Google's earnings is from its share of the contextual advertisements served on the millions of webpages.

Contextual Advertising
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Contextual Advertising

Contextual Advertising

iIntercept Media - Contextual Advertising

Example

If you think it's worth 25 cents to have someone watch your video, you can set US$0.25 as your max CPV. For an in-display TrueView video ad, you'll pay a maximum of US$0.25 when users begin watching your video. For in-stream, you'll pay the maximum CPV when the user watches 30 seconds or sees the end of the ad, whichever comes first. You pay nothing if they don't initiate the video or drop off from the video before the minimum amount of time passes.

You can also set a lower bid for your in-display TrueView video ads than for your in-stream video ads.

Setting a CPV bid

To set a CPV bid, you enter the highest price you want to pay for a view while setting up your AdWords for video campaign. Your bid is called your maximum CPV bid, or simply "max CPV." This bid applies at the campaign level, but you can also set a CPV bid per ad format.

URLS ARE VISITED

We apply the harvested and retained URLS to match your targeted relevant URLS for products and services they search. A user clicks the relevant URLS related to your product or service.

URL TARGETING 
We provide the same research on the keywords used for your products or service to locate the URLS triggered by selected keywords.  The selected URLS are then harvested and retained.

Contextual Advertising
Contextual Advertising
Contextual Advertising

KEYWORD TARGETING 
We provide extensive research on the keywords used for your products or service.  Once the keywords have been select keyword targets related to your product or service are recorded and tracked similar to Google AdWords.

Contextual Advertising

Contextual Advertising

CONTEXTUAL ADVERTISING

Contextual Advertising

Example

Let's say your max CPV is $5.00, and there are two other advertisers in the auction with you with the same Quality Score. One bids a CPV of $1.00, and another bids a CPV of $3.00. Since there are no other competitors bidding more than $5.00, you're the top bidder. However, we're not going to charge you $5.00 if your closest competition is only bidding $3.00. We'll charge you $3.01 for your video play.

How CPV affects your ad rank

The max CPV you set helps determine your ad's position among other ads on search results pages in the Search Network(including YouTube search results) and Display Network pages (which include YouTube as a publisher).

In both cases, a higher CPV will increase your ad's chances of appearing, and increase your ad's chances of appearing in a higher position compared to other advertisers' ads.

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Your actual CPV

Your maximum CPV bid is the most you'll be charged for a video view, but you won't always be charged this maximum amount. Wherever possible, we'll try to charge you only what's necessary for your ad to appear on the page. The final amount you actually pay for a view is called the actual CPV.

Actual CPV is often less than max CPV because with the AdWords auction, you pay no more than what's needed to rank higher than the advertiser immediately below you.