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In 2010, Daniel Middleton (DanTDM) created a YouTube channel and presumably wasn’t earning much money as a teenager. A few years later, he would become the highest-paid YouTube star earning $16.5 million. Many other YouTubers, including Felix Kjellberg (PewDiePie) and Lilly Singh, have made millions as well. Suffice it to say that uploading videos to YouTube can be an excellent way to earn a living.
Thousands of people earn money on YouTube because it’s a high traffic platform. It’s the second most visited website and search engine globally after Google. (YouTube and Google are owned by the same company.) As a top online destination, YouTube boasts several impressive statistics:
- It has over a billion users—almost one-third of all people on the Internet—and each day those users watch a billion hours of video and generate billions of views.
- YouTube (and even YouTube on mobile alone) reaches more 18-34 and 18-49 year-olds than any cable network in the United States.
- It has launched local versions in more than 80 countries.
- You can navigate YouTube in a total of 76 different languages (covering 95 percent of the Internet population).
- If YouTube were a standalone company, it would be worth $160 billion.
- The number of channels earning six figures per year grew more than 40 percent year over year.
Are You a YouTuber?
How a person makes money on YouTube depends if he or she is a “YouTuber” or a casual user of the platform. YouTubers are highly active on YouTube and typically produce and appear in their videos. Also, they dedicate most of their working hours to creating and promoting their content. Casual users, like me, upload videos periodically. For example, I upload videos once or twice monthly (to grow my online brand, reach a different audience and drive traffic to my website). Also, YouTube is not their primary focus or source of income.
YouTubers take different approaches to monetize their channels and videos. To monetize your content, you must own all the necessary rights to commercially use all visuals and audio elements, whether they belong to you or someone else. YouTube provides guidelines for content you create and don’t create. Secondly, revenue can be made directly on YouTube and offsite, for example, directing viewers to buy products on your website.
- YouTube Partner Program
- Google Preferred Program
- Super Chats
- Super Stickers
- Channel Memberships
- Merch Shelf
- Product & Merchandise Sales
- Digital Media Sales
- Membership & Subscription Fees
- Affiliate Marketing
- Paid Product Placements & Endorsements
- Programming Partnerships
YouTube Partner Program
The most common way YouTubers make money is through ad revenue. Ad revenue is managed through YouTube’s Partner Program and paid through AdSense. The YouTube Partner Program (YPP) lets creators monetize their content on YouTube. Users can earn money from advertisements served on their videos and from YouTube Red subscribers watching their content. A channel must reach 4,000 watch hours in the previous 12 months and 1,000 subscribers to join YPP. Users can leave YPP anytime by disabling the monetization feature in their dashboards.
How to join YPP:
- Sign in to YouTube.
- In the top right, select your account icon > Creator Studio.
- In the left menu, select Channel > Status and features.
- Under “Monetization,” click Enable.
- Follow the on-screen steps to accept the YouTube Partner Program terms.
Once a channel joins YPP, it must be linked to an approved AdSense account. AdSense facilitates payments to content creators like YouTubers and bloggers once a month. YouTube pays 55 percent of ad revenue to creators. Revenue details are in your YPP terms.
Google Preferred Program
Google Preferred is a premium advertising program that aggregates the top 2 to 5 percent of YouTube content targeting users between 18 and 34. Unlike YPP, creators cannot apply to the Google Preferred Program (GPP). It’s an invitation-only program. The revenue share for GPP is a secret since creators can sometimes negotiate better revenue splits. High viewership channels such as IGN, The Verge, SciShow, and itsJudysLife participate in GPP.
Super Chat allows viewers to purchase chat messages in live streams. Creators receive 70 percent of chat revenues. Revenue details are in the Commerce Product addendum. To be eligible for Super Chat, you must meet these requirements:
- Your channel is enabled for live streaming
- Your channel is monetized
- Your channel has over 1,000 subscribers
- You are over 18 years old
- You are in one of the available locations
YouTube is rolling out Super Stickers. It allows fans to purchase animated stickers during live streams and Premieres to show their favorite creators just how much they enjoy their content. Stickers will come in a variety of designs across different languages and categories, such as gaming, fashion and beauty, sports, music, food, and more.
Channel memberships allow viewers to join your channel through monthly recurring payments. Subscribers get members-only perks like badges, emoji, and other goods you offer. Eligibility requirements include:
- Your channel has more than 30,000 subscribers (Gaming channels must have more than 1,000 subscribers)
- Your channel is in the YouTube Partner Program
- You are over 18 years old
- You are in one of the available locations
- You (and your MCN, if applicable) have agreed to and are complying with Youtube’s terms and policies (including the applicable Commerce Product Addendum) and have zero live strikes
YouTubers have been earning money from merchandise sales for years, but creators had to direct traffic offsite for sales. Now, creators can sell to fans directly.
In a space directly below a video (the merchandise shelf), creators with more than 10,000 subscribers can sell goods, such as tee-shirts, hats, phone cases, and over 20 different items that make sense for their channels. Ecommerce partners for Merch Self include Teespring, Crowdmade, DFTBA, Fanjoy, Represent, and Rooster Teeth.
Product & Merchandise Sales
Many YouTubers leverage their channels to sell branded products and merchandise including apparel, accessories, and gifts. Setting up an online store is quick and painless with software from Shopify, 3dcart, or WooCommerce. Standard and print-on-demand marketplaces are an option too, for example, Amazon, Zazzle, and Design By Humans. However, online markets list hundreds of thousands of products and are very competitive, so they’re probably not the best places to send your viewers. If a viewer likes you and your brand, it’s better to keep them in your ecosystem to generate sales.
Digital Media Sales
Many YouTubers sell online courses and books. Online courses are a natural extension because they comprise of videos. I’ve come across several travel vloggers who have developed courses with travel tips and insights. You can sell classes on e-learning marketplaces or independently with software.
Publishing a book takes a lot more effort, and I only recommend doing so if you have thousands of channel and email subscribers. DanTDM wrote a book called Trayaurus and the Enchanted Crystal, and Amy Landino published a book entitled Vlog Like a Boss.
Membership & Subscription Fees
A fantastic way to generate passive income is through membership and subscription payments. Patreon is a popular membership platform that makes it easy for artists and creators to get paid. Fans pay creators subscription amounts of their choice in exchange for exclusive experiences and behind-the-scenes content. Over $1 billion has been paid to creators, and the average patron pays more monthly than consumers pay for Netflix, Spotify, or Amazon Prime. Patreon is growing as many YouTubers experience demonetization and foul-ups by YouTube. It has three pricing plans. Alternatively, you might use a WordPress membership plugin or charge members to access a closed/private Facebook Group. Many billing apps are available to support recurring payments.
Affiliate marketing is a performance-based marketing activity. An affiliate or publisher promotes a product or service online and receives compensation for achieving a specific objective or action. A merchant or advertiser specifies the goal, which is usually a valid sale. For example, a merchant will pay an affiliate a 30 percent sales commission. Some merchants have pay per lead programs that pay publishers for getting prospects. For instance, an advertiser pays one dollar for each person who registers for a webinar. Learn more about affiliate marketing.
YouTubers who dabble in affiliate marketing add affiliate links to their description and about sections. In their videos, they casually mention to “see” or “click” on links in their descriptions. They might also direct traffic to their websites for affiliate marketing and ecommerce purposes. Most affiliates on YouTube don’t disclose their affiliates links, but they should as per the FTC’s guidelines.
Like affiliate marketing, MagicLinks works with content creators by providing social commerce tools. It offers a free tool that helps you easily create product links to share with your fans across your social media profiles.
Paid Product Placements & Endorsements
Just like product placements in movies and endorsements by professional athletes, YouTubers can earn money in these ways as well. According to YouTube,
You may include paid product placements, endorsements, or other content that requires disclosure to viewers (“Paid Promotion”) in your video content. If you do, we require you to notify YouTube by checking the “video contains a paid promotion” box in your advanced settings.
Paid product placements are pieces of content that are created for a third party in exchange for compensation or where that third party’s brand, message, or product is integrated directly into the creator’s material.
Endorsements are pieces of content created for an advertiser or marketer that contain a message that consumers are likely to believe reflects the opinions, beliefs, or experiences of the content creator or endorser.
In most cases, high traffic YouTubers are approached by companies to place and endorse products. However, some creators initiate and pursue deals.
Other Revenue Streams
YouTubers with large and loyal followings, those usually in the Google Preferred Program, are ripe for original programming deals with YouTube Red, Netflix, CNN, and media platforms. In 2016, YouTube star Casey Neistat inked a partnership with CNN worth $25 million. Brazilian vlogger and comedian Felipe Neto released a Netflix original comedy special, “My Life Makes No Sense,” in 2017.
A lesser-known revenue stream for YouTubers is that of live events such as tours, speaking engagements, and comedy gigs. For instance, DanTDM toured Australia. Perhaps it’s your time to shine in-person and on stage.
Frequently Asked Questions
How much can you make on YouTube?
There are no limits to how much a YouTuber can make, which differs from most nine-to-five jobs. However, some video categories perform better than others. For example, comedy/skits, gaming, fashion, music, and tech are popular categories.
Millions of people flock to YouTube to be entertained and relax. Regardless of the content category, engaging videos and high production value can yield significant revenues. For instance, geography isn’t an exciting topic for most people. Knowing this, Paul Barbato infuses his geography-themed videos with flair, excitement, and comedy. His channel has amassed millions of views and subscribers.
How much does YouTube pay you for 1 million views?
If a creator isn’t enrolled in YouTube monetization activities like YPP, the creator will earn nothing from his or her views. If the creator enables monetization with ads, 1 million views can generate between two to five thousand dollars for the creator. The AdSense revenue that a creator earns will vary depending on many factors including the types of ads running, content category, and average video length.
How many subscribers do you need to get paid?
Channel subscribers don’t factor into AdSense revenue, only eligibility for different YouTube monetization features. However, channels that feature many subscribers have a social proof advantage. Social proof is a psychological phenomenon in which people rely on the feedback and actions of others to determine what is right and wrong in each situation. If an individual sees many channel subscribers, it will motivate him or her to subscribe.
How do you earn money from YouTube without AdSense?
YouTubers can earn money without AdSense. They can make money from e-commerce, affiliate marketing, paid product placements and endorsements, membership fees, live events, and so forth. Also, many creators leverage YouTube to crowdfund their profit-seeking endeavors.
Do you earn money on YouTube Red?
All your videos that appear on ad-supported YouTube will also be available without ads on YouTube Red. YouTube Red provides a secondary revenue stream for creators in addition to what they already earn through AdSense.
How does YouTube pay?
YouTube pays publishers through AdSense and depending on your payment address, the following payment options may be available:
- Electronic Funds Transfer (EFT)
- EFT via Single Euro Payments Area (SEPA)
- Wire Transfer
- Western Union Quick Cash