How People on YouTube Earn a Living
In recent years, we have seen a huge shift in the way that people live their life and spend their time. Where once we would have the TV as the main way to find entertainment, this is very quickly changing to online platforms with YouTube being a key figure in this growth. As a result, big companies are now starting to see the benefits of advertising on videos and sponsoring the many YouTube users and the whole process is a spiral of growth where one feeds off the other.
As YouTube has grown, we have seen the introduction of so-called ‘YouTubers’ who actively upload a number of videos every week for their following. Whether it is video logging (vlogging) about their day, talking about a particular topic, or even playing video games, some YouTubers are now making a living from content creation not only because of the ad revenue from each video but because of endorsements from companies. Just recently, we have seen YouTubers appear in advertising campaigns and this seems to be a more frequent occurrence.
With this in mind, it has become somewhat of a career option for younger children who want to be the next big thing on YouTube. Although this sounds great, it begs the question of what YouTubers actually make in terms of earnings. Nowadays, you have to consider the revenue they gain from each video as well as endorsements and even any books or films they have been involved with. Furthermore, some YouTubers are touring and putting on performances, based around videos on their channel, on stage so let’s take a deeper look.
YouTube Earnings – Before we head any deeper, it is important to note that some YouTubers such as Zoella and PewDiePie are thought to be millionaires so this isn’t a ‘side-career’ in which to make a little bit of money on the side. As mentioned, some of YouTube’s hottest channels receive millions of views each and every week which has yielded fantastic rewards for the owners.
Despite common belief, YouTube doesn’t actually pay producers for content. When we talk of earnings from YouTube, this comes from ‘Adsense’ which is one of Google’s most valuable income sources. As a program that cannot be cheated in any way, it generates ads on YouTube videos and pays the producer of the content money depending on different factors. Typically, it will use a CPM formula.
Cost Per Mile (CPM) – Sometimes called Cost Per Thousand (CPT), this essentially means that a YouTuber will get paid a certain amount for every 1,000 ad impressions that come from a video. To keep things simple, let’s say that someone earns $1 per 1,000 ad impressions. If this is the case, it means that 1,000 video views is equal to $1 in revenue. For those who receive one million video views each day, this would be equal to $1,000 in revenue.
As mentioned previously, we were just suggesting $1 as the CPM but the truth of the matter is that this can vary from $0.10 to $10 per 1,000 views. Ultimately, the CPM that someone earns will vary depending on the content that they produce and the niche that they target. For example, the gaming industry will have a different average CPM than those who produce educational content which, in turn, will be different to the comedians on YouTube. As you can see, the people who receive millions of views and therefore ad impressions on their videos are doing very well out of it and this is before you consider personal endorsements and miscellaneous earnings.
YouTube Endorsements – Just recently, there has been somewhat of a debate over paid endorsements by content creators on YouTube. Before this year, YouTube didn’t have set rules as to whether YouTubers had to let their audience know that they were sponsored because it was never a problem. Therefore, channels were receiving thousands of dollars for product placement and for promoting products and services without the audience knowing. However, this has now been reassessed and audiences need to be made aware whenever a video is sponsored using a disclosure of ‘Paid Promotion’ in the video.
In recent years, even the biggest companies have started to realise the following that YouTubers have both on their channels and on social media. What’s more, for them this is niche advertising because the viewers are watching content that they enjoy. Therefore, we are seeing YouTubers strike big money deals to promote a product or service. For example, developers of games and gaming accessories are sponsoring gaming YouTubers because they know that there is an immediate audience for the products.
In addition to this, YouTubers promote products with a special code and this allows viewers of the video to buy a product from the company for a discounted price. Of course, the YouTuber has already been paid for this promotion and they could potentially receive a percentage of all sales as commission.
All things considered, we are still in the early stages of YouTube influencing and therefore there are varying fees being paid by companies as endorsements. Whilst some YouTubers work solely on commission, some are working on a certain amount of money per views on the video whilst others are receiving a flat fee to represent a particular brand. For example, Epic Meal Time has famously linked up with Netflix in recent years whilst both MysteryGuitarMan and Rhett & Link featured in an ad campaign for Coca-Cola and McDonald’s.
Additional Earnings – On top of ad revenue and endorsements, we are now starting to see YouTubers branch out beyond the realms of the internet. Over time, we have seen the addition of many books to the market including Alfie Deyes’ ‘The Pointless Book’ which was extremely popular after release selling over half a million copies. Similarly, Deyes’ partner Zoe Sugg (Zoella) has released books with her first two alone selling nearly one million copies earning the YouTuber millions. After breaking the record for book sales in the first week, her first book ‘Girl Online’ is now available in 25 different languages.
Aside from books, we have seen YouTubers such as KSI and Casper Lee appearing in their own movies. Furthermore, Lee appeared in another movie with Joe Sugg (brother of Zoe) in ‘Joe & Casper Hit The Road’. Again, both of these titles proved to be popular and made the once content producers on a video sharing website millions.
Now, many YouTubers are also touring as a result of YouTube. Whilst some are stage performances and adaptations of their YouTube channels, it is important to note that many singers have built a reputation after starting on YouTube. After simply uploading videos to YouTube, Shawn Mendes, Us the Duo, Cody Simpson, The Weeknd, 5 Seconds of Summer, Carly Rae Jepsen, Tori Kelly, Charlie Puth, and of course, Justin Bieber all became international stars.
Summary – There is no doubting it, YouTube is now a huge platform and has made many people rich over the years. As a result, we are also seeing comedians and actors joining the scene including UK’s Rob Beckett and James Buckley. Although it seems as though YouTube has been around for some time, we are only in the early stages in terms of careers and earnings so it remains to be seen what happens in the future.
With so many people now joining YouTube and attempting to create a channel like many of their role models, it is getting harder to get ‘noticed’ but, as you can see from the information we have provided today, when it works, it really does work.