📍YouTube Ads: Target Local Customers NOW with Demand Gen Campaigns (less than $10 per day)🚀

Are you tired of pouring money into marketing that feels like a shot in the dark? You’ve invested in ads, but they aren't reaching the people who actually live nearby and need your services. The truth is, that a generic approach to digital marketing will always yield generic results.

Today, I'm pulling back the curtain on one of the most powerful and cost-effective Google Ads strategies:

Google's Demand Gen campaigns and YouTube. If you have video assets, this campaign type is one of the most effective and inexpensive ways to drive local conversions and increase awareness with locals for your products and services. 

In this post, I’ll show you how to target people actively looking locally for your products and services RIGHT NOW in YouTube. This is a video-first strategy.

This isn't just about getting views—it's about driving high-quality leads and sales for a local business with a budget as low as $10 a day.

Ready to stop guessing and start targeting? Let's dive in.

When Should You Choose a Video-First Demand Gen Campaign?

You want a video-first campaign

The biggest reason to run campaign only on YouTube is that your main goal is to use video. Video is incredibly powerful for telling your brand's story, showing off your product, or explaining a service.

You Have Limited Budget

While Demand Gen campaigns are meant to work across different channels, each channel has its own style and audience. If you only have one or two great video ads and a limited budget, it often makes more sense to put all your money where it will have the most impact: on YouTube.

(See my related post for a deeper dive on how to choose the right Google Ads campaign type.) 

Your target audience is on YouTube

Consider who your ideal customer is. Do they watch YouTube for entertainment, to learn new skills, or to research products? YouTube is the go-to platform for product reviews, how-to guides, and a wide range of content.

While a full Demand Gen campaign offers a lot of reach, sometimes a more focused approach is the best way to start. By running your campaign only on YouTube, you can make sure your video creative is seen by the right people, giving you a better chance of getting clicks and new customers.

Why YouTube is Your Secret Weapon for Local Customer Acquisition

When you think of YouTube, you might think of tutorials and entertainment. But for a growth-minded business owner, you should think of it as the world’s second-largest search engine—a place where people are actively seeking solutions to their problems. This unique intent, combined with Google’s powerful data, makes YouTube an essential channel for your marketing mix.

Here's a breakdown of the strategic advantages:

Your Step-by-Step Guide to Launching a Video First Demand Gen Campaign with YouTube Videos

Setting up a Demand Gen campaign is straightforward when you know the steps. Follow this guide to get your first campaign live and start generating results.

This is your first crucial step. Log in to your Google Ads account and click to create a "New Campaign."

Your primary objective is Leads because your goal is to generate tangible business outcomes, not just impressions. So, choose Leads as the campaign objective.

Then, choose Demand Gen as the campaign type. This is Google's newest campaign type, specifically built to use rich, visual creatives to find people who are ready to convert across Google’s most engaging platforms, including YouTube, Discover, and Gmail.

For a local business, we recommend starting with a minimum $10 per day, to give the algorithm enough data to learn what works. However, if you have a larger budget, I recommend increasing it as larger budgets equate with larger results.

Initially, you should run your campaign without a target Cost Per Action (CPA). This allows Google's system to explore and find the most cost-effective conversions on its own. Once you've collected enough data (usually after a few weeks), you can review your average CPA and set a target to optimize for even better results. (Read my related post on the cost of Google Ads.)

Read my post about best low budget Google Ads strategies for a deeper dive into squeezing the most out of a small Google budget. 

This is where you get hyper-specific on where you want your ads to show geographically.

Under Location Settings, be precise. Target your city, a specific radius around your business location (e.g., "10 miles around 92592"), or even a few specific zip codes. You can even exclude areas where you know you don't get business. This ensures every ad dollar is reaching a local, viable audience. To be able to see a map and then adjust your geographic targeting of where you want your ads to show, click on "Advanced Search."

For language, it's generally best to start with your primary business language, but you can always expand if your customer base is multilingual.

Why does the language setting matter? 

It tells Google who should see your ads. In short, it makes sure your ads are shown to people who can actually read and understand them.

How Google knows a user's language?

You might think Google just looks at a person's browser settings, but it's a lot more advanced than that. Google uses a few different clues to figure out a person's language:

This is true for search ads and also for other types of ads, like those that appear on websites or YouTube.

Why does the language setting matter?

Choosing the right language for your ads can make a huge difference in how well your campaign performs.

Create your first ad group. At this step, this is where you isolate your video ads to show only on YouTube. 

Crucially, uncheck the boxes for "Discover," "Gmail," and "Google Display Network."

While Discover, Gmail, and the Display channel have their place, they often generate lower-quality, interruptive traffic for a Demand Gen campaign.

By focusing your budget on YouTube, you ensure your money is spent on the highest-quality placements. Then, add the strategic audience segments you built from the options above. For example, if you're a day spa, you might create an ad group just for "In-Market: Beauty & Personal Care."

Who Do You Want to Target? Creating Audiences.

This is where we build a high impact audience profile. Tapping into Google's vast data requires a solid understanding of your ideal customer. 

Click on the "Add an audience" button and then "New Audience" and you'll see something similar to below. Then click on Demographics.

Here are the key audience selection features you can use to build a powerful campaign...

Demographic Targeting (starting with the basics): 

Choose your ideal demographics. Begin by defining your audience using key attributes like age, gender, and family status. This is your foundation.

Example Application:

If you run a family law practice, you could target people with a specific household income and parental status. A mortgage broker could effectively target "Homeowners" or "Renters" to align with their primary business goals.

In-Market Audiences (targeting active buyers): 

Next, click on "In-Market." 

This is the most valuable audience type for driving immediate conversions. These are groups of people that Google has identified as actively searching now for your products and services. Below is an example of several segments. There are hundreds of segments that you can search for to find the most relevant for your business. 

Example Application:

If you own a day spa, you can specifically target "Beauty & Personal Care" in-market audiences. In comparison, a restaurant can target people who have recently searched for "restaurant delivery" or "takeout."

 Affinity Audiences (capturing broader interest):

Affinity audiences are based on a person’s long-term interests and lifestyle. While they may not be actively searching for your service at this very moment, they are highly likely to be receptive to your message based on past behavior signals Google collected on each person. These audiences are excellent for building brand awareness and staying top-of-mind with future prospects. 

Example Application:

A personal trainer can target "Health & Fitness Buffs" or "Yoga Lovers." This keeps their brand visible to a relevant audience, so when they are ready to hire a trainer, your business is the first one they think of.

 Lookalike Audiences:

You might be familiar with Facebook Lookalike audiences, but Google offers them, too. Lookalike audiences are an excellent way to boost your campaign performance by providing audience signals to Google Ads of past customers or of people that have interacted with your website or YouTube channel. 

To create Lookalike audiences, you can use website visitors, YouTube channel watchers, your own list, or a combination of any or all of those sources. (read my related post on how to set up Google Ads Conversion Tracking and my post on how to use Google Tag Manager and Google Analytics to track conversions)

Your first step if you have never created a Lookalike audience is to first go to the Audience Manager under Tools then Audience Manager and choose which type of audience you're creating - website visitors, YouTube users, customers that interact with your website via Google Analytics, or a customer list. 

Most people load a customer list they already have. With your own customer list, you will need the list to have emails and phone numbers which Google will then use to match to profiles. 

High volume consumer-facing businesses like restaurants often have excellent customer lists that can be leveraged in Lookalike audiences since customers have to enter their email and phone number for orders.

If you are not collecting these data, you're missing out on a crucial asset that can be leveraged extensively for running effective Google Ads campaigns. Most lists will take 24 hours or so to complete the matching process before they're ready to use. 

Once you have created your customer list, in your New Audience, choose the customer lists you added to create your Lookalike audience. 

Your customer list should be larger than 1,000 records of emails and phone numbers. What's important to recognize is that not all of your list will match to profiles that you can target. However, experience has shown with most of our clients that your match rate will likely fall somewhere between 50% to 90%. And you need to have a final matched list size of at least 1,000 before you can use it in your campaigns. 

This is your chance to shine. You'll need a YouTube video link for your ad creative. You can add up to five videos, and Google will automatically test them to find the best performer.

For your ad copy, think urgent, unique, and benefit driven.

Here is an example: Instead of "We're a great gym," try instead, "Lose 10 Pounds in 30 Days."

You can add up to five Headlines, Long Descriptions, and Descriptions - I encourage you to use them all. When you use all the available headlines, Google Ads will mix and match all the variations to find the best performing combinations, which is a win for your ad performance, and the result is that you will see improved campaign performance. 

Finally, don't forget to add at least four sitelinks to other key pages on your website. For example, your Contact Us, Services, or FAQ page. This improves the ad's performance by giving people more ways to engage.

Review your campaign settings one last time. Once everything looks good, publish the campaign. But if you see red like below - you've got work to do.

But remember, the real work begins now when the ads go live. Over the next few weeks, you'll need to monitor the data to see which ads and audiences perform best. Then you can make informed decisions to optimize your campaign, whether that means pausing underperforming ads or increasing the budget for the ones that are driving sales.

Ready to Stop Guessing and Start Getting Results?

YouTube Demand Gen campaigns offer a clear, measurable, and highly effective way for small businesses to reach their local audience with modest ad spend budgets (Read my related post for more on low budget Google Ads strategies). With a modest budget, you can drive real phone calls, form submissions, and sales without the guesswork.

Stop letting your competition dominate the local market. Schedule a free call with me today to discuss your business and discover how a targeted YouTube ad strategy can help you grow sales and profit.