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Are Influencer Marketing Companies Replacing The YouTube MCN?
MCNs launched shortly after YouTube influencers
started to rise in audience and prominence. The first set of MCNs (Revision3, Next New Networks, Machinima, and Maker Studios) launched around 2010 as the new way of content support and distribution to serve the new wave of audiences on YouTube. Several MCNs (multi-channel networks) have been acquired by major brands, most notably Walt Disney’s purchase of Maker Studios for $500M
, Fullscreen’s $200-$300M
acquisition by AT&T/Chernin, Stylehaul’s $107M
, and most recently Collective Digital Studios
. As defined by YouTube’s own Creator Hub
“are entities that affiliate with multiple YouTube channels, often to offer assistance in areas such as product, programming, funding, cross-promotion, partner management, digital rights management, monetization/sales, and/or audience development. These companies are not affiliated with or endorsed by YouTube or Google.”
With the meteoric growth of brands, broadcast networks
, and major advertisers augmenting their reach on YouTube by aligning
with prominent YouTubers
to create branded or sponsored content, many of these entities have looked to MCNs for support and guidance. The largest MCNs oversee tens of thousands of YouTubers
creating a conflict in trying to provide tailored services for their myriad of smaller channels and creators to monetize and grow while simultaneously collaborating with top brands to orchestrate advertising media campaigns on YouTube. Furthermore, restrictive MCN contracts
can limit a YouTuber’s abilities to do smaller brand partnerships that best benefit them but may not achieve the scale to interest the broader governing MCN entity.
Oftentimes, brands also look to hand pick the YouTube channels and creators they want to work with, rather than exploring packaged deals through MCNs that may not serve the best direct interests of the advertisers. There are also tools for discovery like Open Slate, Tubular Labs, and Social Blade — again, all requiring extensive manual digging and inherently built with the “plug-and-play” understanding that brands come to these tools with an intimate knowledge of the space.
The Influencer Marketing Companies VS. MCNs
An influencer marketing company works with brands to build the best possible media, creative strategy, and options through online influencers, YouTubers, bloggers, Instagrammers and other social media channels. These companies are “network-agnostic,” meaning that they work across and alongside the vast networks of MCNs, YouTube and talent management groups, and traditional Hollywood agencies that have recently gotten their feet in the game of managing YouTube influencers (both Bethany Mota and Joey Graceffa with UTA
, Jenna Marbles with CAA
are some of the notable high profile talent representation deals). Influencer marketing companies negotiate best rates with their network of digital influencers and are not hindered by preferential contracts allowing the agency to orchestrate the best strategic alignments between both sponsoring brand and genuinely interested influencers who are passionate about delivering measurable results.
Top influencer marketing companies and platforms like Mediakix
, TapInfluence, and FameBit are innovating and providing custom solutions for brands to find and work with the right digital influencers, content creators, Instagrammers, YouTubers, and bloggers. These companies are now doing much of what MCNs originally promised to do which is to adeptly facilitate the best marketing campaigns and brand sponsorships with top creators, channels, and social media influencers.
What Does This Mean For The YouTube MCN?
With the rise of influencer marketing companies and advertisers’ heightened interests to work with YouTubers, MCNs are no longer as relevant of a means of sourcing revenue and advertising deals for YouTubers. Signing with an MCN often comes at a high cost for YouTube channels. Standard deals include the MCN taking a significant cut of all Adsense (YouTube pre-roll and display advertising run across the channel) revenue that can run as high as 50%. Previous to the accession of influencer marketing companies and agencies, YouTubers were left with few options to pursue advertiser sponsorships leaving them beholden to an MCN’s promises of providing advertiser deals.
Though a YouTube MCN adds value for the advertiser seeking a broad, less targeted approach (think generic pre-roll branding ad across multiple channels), brands seeking to drive measurable sales metrics and conversions will find best ROI success with influencer marketing companies. As influencer marketing companies cater more to the marketing and advertising needs of major brands, YouTube MCNs may become more involved with the development of programmatic digital content production (i.e. a short-form, streaming web TV series).