YouTube Shorts is attracting more advertising dollars as it averages over 200 billion daily views in the second quarter.
Mark Ballard, research director at Tinuiti, noted that clients buying Shorts inventory increased their spending by more than 11% from Q1 to Q2 of this year. Similarly, Grant Kalfus, director of media at Markacy, reported that his agency is pushing Shorts across almost all clients and expects to double their Shorts investment by year-end.
Kalfus highlighted the cost efficiency driving this growth: “CPMs on Shorts are around $5, compared to $10 to $12 on Meta’s Reels and TikTok,” making Shorts an effective channel for incremental reach.
Google’s recent launch of Demand Gen campaign options, including the ability to target Shorts placements exclusively and run standalone Shorts campaigns, has fueled advertiser interest.
Brian Binder, innovation and growth director at Tinuiti, explained that these new options allow brands to integrate Shorts into their social strategies without navigating the broader YouTube ecosystem. “YouTube now gives control to target Shorts inventory across Video Reach Campaigns, Video View Campaigns, Demand Gen, and YouTube Select,” he said.
Sam Piliero, founder of The Moonlighters, said the standalone Shorts campaigns and full team support from Google have dramatically boosted adoption. “We’re seeing the lowest CPMs in nearly five years and doubles or triples in ad spend quarter-over-quarter for some accounts,” he added.
This growth follows Google’s shift from the Shorts Fund to an ad revenue share model in early 2023 and efforts to enhance Shorts for creators with features like Super Thanks, affiliate tags, improved video editing, and AI-based tools.
With growing viewership, including an option to watch Shorts on TV, YouTube is positioning Shorts not just as a hedge against TikTok’s uncertain U.S. status but as a major platform in its own right.
Shamsul Chowdhury, global EVP at Jellyfish, noted Google’s push to entice advertisers: “They’re showing how Shorts can replicate brand momentum found on Reels or TikTok.” Early beta access and ad credits have helped agencies like The Moonlighters shift budgets toward Shorts.
Binder emphasized the unique audience reach: “45% of Shorts viewers don’t use TikTok, and 65% aren’t on Instagram,” signaling untapped potential for advertisers focused solely on other platforms.
Kalfus summarized the trend: “Google is steering advertisers toward Demand Gen campaigns with Shorts as a fast-paced, UGC-focused format offering unparalleled engagement compared to competitors.”
YouTube did not respond to requests for comment.