How to Advertise on YouTube with a Small Budget

At Lillian Purge, we specialise in Local SEO Services and have written How to advertise on YouTube with a small budget so you get maximum reach and results without overspending.

YouTube is one of the most powerful platforms for reaching new audiences and promoting your business, even if you’re working with a limited budget. With over two billion monthly users, YouTube offers incredible reach and precise targeting options that allow small businesses to compete effectively without spending large sums on ads. The key is knowing how to optimise your campaigns for performance, focus on the right audience, and make every pound count.

Start with Clear Goals

Before spending any money, define what you want to achieve. A small budget works best when it is focused on specific, measurable goals. Common YouTube advertising objectives include:

• Increasing brand awareness in your local area.

• Driving traffic to your website or landing page.

• Promoting a specific product, service, or offer.

• Growing your YouTube channel or subscriber base.

Clear goals help you choose the right ad format and targeting strategy. For example, if your goal is awareness, you might focus on short skippable ads. If you want direct conversions, a call-to-action-focused campaign will work better.

Choose the Right Ad Format

YouTube offers different types of ads, and some are more cost-effective than others for smaller budgets.

Skippable in-stream ads: These play before or during videos and can be skipped after five seconds. You only pay when someone watches for 30 seconds or interacts with the ad, making them a budget-friendly option.

Bumper ads: These are six-second non-skippable ads that are ideal for increasing brand recall. They’re short, cheap, and great for local promotions.

In-feed video ads: These appear in search results or related video sections and are effective for engagement-based campaigns.

Start with skippable ads to test performance, then expand into other formats once you understand what works best for your audience.

Set a Small Daily Budget

You don’t need a large advertising budget to see results. YouTube Ads can start with as little as £5 to £10 per day. Begin with a modest budget, monitor performance closely, and scale up once you identify which ads bring the best return.

When setting up your campaign in Google Ads, select a daily budget you’re comfortable with and let the algorithm optimise delivery based on performance. This helps ensure your money is spent efficiently while still reaching your target audience.

Use Targeting to Your Advantage

Precise targeting is what makes YouTube ideal for small budgets. Instead of wasting money on broad audiences, use Google Ads’ targeting features to focus your spend.

You can target by:

• Location: Focus on your local area to reach potential customers nearby.

• Interests and behaviour: Target people interested in topics related to your product or service.

• Keywords and placements: Show your ads on specific YouTube videos or channels relevant to your niche.

• Demographics: Choose by age, gender, and income level to match your ideal audience.

The more specific your targeting, the lower your cost per view (CPV) and the more relevant your audience becomes.

Create Simple but High-Quality Video Content

You don’t need expensive equipment or a film crew to make an effective YouTube ad. Authentic, engaging videos often perform better than overproduced ones. Use your smartphone or a basic camera, ensure good lighting, and focus on clear messaging.

Keep these points in mind:

• Grab attention in the first five seconds.

• Introduce your brand early.

• Keep videos under 30 seconds for most campaigns.

• Include a strong call to action, such as “Visit our website” or “Book today.”

If you’re not comfortable on camera, you can use voiceovers, animations, or slideshows to deliver your message effectively.

Focus on Local Audiences

If your business serves a specific area, limit your ads to local viewers. You can target by city, postcode, or region. This reduces wasted spend and increases relevance, as people nearby are more likely to convert.

Local targeting also helps your ad rank higher for relevant searches in your area. Combine this with keywords like “near me” or your city name to enhance local visibility.

Leverage Remarketing

Remarketing allows you to show ads to people who have already interacted with your business. These users are more likely to convert, and remarketing campaigns usually cost less per conversion than cold targeting.

For example, you can show ads to users who visited your website but didn’t make a purchase or those who watched one of your YouTube videos previously. This keeps your brand top of mind and helps maximise ROI without increasing your budget.

Optimise Your Campaign Regularly

Running YouTube Ads effectively on a small budget requires regular optimisation. Use Google Ads’ analytics to track metrics such as:

• Cost per view (CPV).

• View rate (percentage of people watching your ad).

• Click-through rate (CTR).

• Conversions (website visits, form submissions, or sales).

Identify which ads, audiences, or placements perform best and reallocate budget to those areas. Turn off underperforming campaigns to save money and improve results over time.

Use YouTube’s Free Features to Complement Ads

Advertising doesn’t have to be your only strategy. Combine paid ads with free organic tools to extend your reach.

• Upload regular videos to your channel to build an audience naturally.

• Optimise video titles, descriptions, and tags for SEO.

• Encourage viewers to subscribe and engage with your content.

• Share videos on social media and embed them on your website.

This integrated approach amplifies your reach and makes your ad budget more effective.

Experiment with Bidding Strategies

If you’re new to YouTube Ads, start with Max CPV (Cost Per View) bidding to control how much you pay each time someone watches your ad. Once you have conversion data, you can switch to Target CPA (Cost Per Acquisition) or Max Conversions to let Google optimise automatically for better performance.

Testing different bidding methods helps you find the balance between cost and results.

Keep Campaigns Short and Focused

For small budgets, short-term campaigns are often more effective. Focus on one goal per campaign—such as promoting a single service or product. This clarity ensures your message stays focused and your spend is concentrated on achieving measurable results.

You can always re-run successful ads or extend campaigns once they prove profitable.

Final Thoughts

Advertising on YouTube with a small budget is completely achievable when done strategically. The key is focusing on specific goals, precise targeting, and regular optimisation.

By creating engaging content, narrowing your audience, and testing different ad formats, even modest budgets can deliver strong results. Over time, as you refine your strategy and identify what works best, you can scale up confidently to reach more customers and grow your business effectively through YouTube advertising.

We have also written in depth articles on how much does youtube pay for 1 million views and how to block someone on youtube as well as our YouTube Hub to give you further guidance.