How YouTubers Make Money
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Is Your Favorite YouTuber "Selling Out?" Here's How YouTubers Make Money:
Forbes recently published their first ever list of highest-grossing top YouTube stars revealing 2015 yearly income figures ranging from $2.5 million (a three way tie between Lilly Singh, Roman Atwood, and Rosanna Pansino) to PewDiePie's $12 million. While these top ten most popular YouTubers are making substantial amounts of money stemming from their YouTube channels (collectively, they average 13.2 million subscribers each across their primary channel), there are hundreds of thousands of smaller-to-midsize YouTube channels all struggling to monetize their social media stardom in a sustaining fashion.
As one of the many YouTube channels with over half a million subscribers, co-host of the vlog channel Just Between Us Gaby Dunn recently penned an in-depth article describing her financial hardships as a YouTube content creator. Dunn relates both her and her fellow YouTubers' accounts of being "social media famous," striving to create content on a full-time basis, all while attempting to balance menial jobs and positive, recurring cash flow.
While each channel and monetization strategies will be different, here are the 6 most common ways on how YouTubers make money with their growing channel:
The Anna Akana video referenced in Gaby Dunn's article. Watch to see an inside look on how YouTubers make money.
How YouTubers Make Money: 6 Common Ways
1. Video Ads, Ad Revenue
Video advertisements usually served at the onset of a YouTubers video is one of most common ways for YouTubers to make money. CPMs (cost per impression) varies due to audience and video categories, however channels do split ad revenue with YouTube (see our article here "How YouTubers Make Money With YouTube Red" for a video look at how YouTube's new subscription service will affect YouTubers). Furthermore, YouTubers who are part of an MCN (multi-channel network, see our article here on "What's Better: MCN vs. YouTube Influencer Agency?") will additionally split their share of ad revenue with their MCN.
2. Brand Deals, Sponsored Videos
As referenced extensively by both Gaby Dunn's article and Anna Akana's video (above), brand deals or sponsored videos are the "bread and butter" for an up-and-coming YouTuber. Although they are a financial staple for most YouTubers, it does come at cost to both their channel growth and audience perception -- oftentimes sponsored videos are continually met with audience backlash and a windfall of unsubscribers.
While brand deals and sponsored videos are an essential financial staple for YouTubers, it's a two-way street for both brands and influencers. See our video post here to learn how brands can best work with popular YouTubers.
To learn the difference between sponsored content, native advertising, and influencer marketing, see our explainer post here.
3. Affiliate Commissions
In addition to brand deals and sponsored videos, YouTubers can generate income with affiliate links (similar to blog advertising, see the differences between sponsorship and affiliate commissions here). Oftentimes, YouTubers will reference and recommend specific products, brands, or services with a customized link (URL) below in the video description box. Depending on the affiliate commission structure, the YouTuber will be henceforth paid per link click or possibly sale.
Similar to other creatives, artists, and musicians, YouTubers can possibly further commercialize their social media followings with merchandise sales (t-shirts, apparel, etc.).
5. Patreon, Crowd-sourced Channel Sponsorship
Subscribers can donate directly to each channel via YouTube's "Support this channel" button. Alternatively, many YouTubers maintain a Patreon profile and direct their audiences to support their vlogging efforts.
6. Hosting, Speaking, Live Appearances
With the development of live-streaming technology and platforms, YouTubers and other top social media influencers are being enlisted to be a part of live campaigns and activations. Similar to brand deals, these opportunities usually come at an ad hoc basis and although paying, may not provide a recurring source of revenue.
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December 16, 2015 By Evan