Becoming a YouTuber is now considered one of the most desirable jobs in the world. There is a divide all across YouTube – where some creators seem to have incredibly glamorous luxurious lifestyles, whilst others talk about struggling to even pay their bills. Now, their spending habits are obviously a factor in that too, but the truth is that when it comes to making money from YouTube ad revenue, views are not paid equally.
Some creators get paid far more for the exact same amount of views. You see, YouTube don’t set a price for ads. They don’t say you’ll get $x for x views. Instead, every time an ad is displayed on a video, advertisers bid how much they’re willing to pay to be in front of that content. Which means that for certain types of videos, advertisers will pay much much more.
There are topics which advertisers are willing to pay much more to be in front of, thus earning more ad revenue. That’s typically because if you’re selling something finance related you often have higher profit margins, and you also know that anyone watching a finance video is very likely to be interested in what you’re selling.
However, if channel is about pranks, your ad revenue will be less. To advertisers, those aren’t the types of videos that advertisers want to pay a lot to be in front of – they don’t fully know whose gonna be watchingthose type of videos, and they don’t really relate very well to particular products or services. So when it comes to YouTube ad revenue, the riches are in the niches.
Certain types of videos are simply much more valuable to advertisers, and so they will earn far more. And if you have your own channel, when you go into Creator Studio, you’ll see which of your videos advertisers are paying most for, by looking at the CPM – this metric tells you how much advertisers pay for every 1,000 monetized views of that video. So, hypothetically, a comedy sketch may have a $2 CPM. A video about insurance could have a $40 CPM.
Which means that for every 1,000 views, the insurance video is getting 20 times more money. After a million monetized views on both, one would have about $2,000, the other would have $40,000. And whilst that may seem a little unfair, it does make sense. Because you can imagine an insurance company would be willing to throw big money to be in front of a video that’s about insurance, whereas not many companies are gonna throw big money to be in front of a comedy sketch.
However, if you are in a niche with a typically low CPM, remember that every video is ranked individually. So if you were making a comedy sketch, if it was a comedy sketch about making money, finance, investing, real estate, business, lawyers, or anything that advertisers would likely pay more for – you can still get a high CPM. Because YouTube is looking at things like the words you say within your video, and your title and tags.
So if you really wanted to, you could deliberately make content around topics that are known to be more profitable. But, that’s not the full picture. Advertisers don’t just pay more for certain topics and keywords, they also pay more depending on who the ad is being shown to. For example, most advertisers will pay considerably more for views from people in first world countries, especially the US and the UK.
This is simply because they know people in these countries typically have a higher amount of disposable income to spend on their products and services. After all, it’s a bit pointless running an ad for a $500 product in countries where the average citizen can’t afford that. In fact, because of the large amount of data Google has on most people, advertisers can target their ads based on a huge amount of different factors, even things like interests and estimated household income.
So, the amount a YouTuber earns is not just based on what their video is about, but also who is watching it, and how much advertisers are willing to pay to be in front of those type of people. Because, advertisers will bid more to be in front of certain demographics and topics, which will drive the CPM up, so the creator earns much more money. But hold up. Because this is just the tip of the monetization iceberg.
For the richest YouTubers, ad revenue is not how they make most of their money. If you want to make a full-time income from YouTube, ad revenue should never be your main revenue stream. It’s too unpredictable, and quite frankly, there are better ways to make more money. Here’s what you need to remember; attention = money. If you have people’s attention, people who are watching your videos and liking your content, then there are countless other ways you can monetize.
Even if your channel has 0 subscribers, you can start monetizing right away with affiliate marketing. This is where you partner with businesses who have products or services your audience may like, and promote them within your video. You’ll get a unique affiliate link which you can put in the description, and every time someone buys through your link, you’ll get a commission from the sale. You don’t have to deal with making the product, shipping it, managing it, customer support – anything.
Just make sure it’s a great product you think your audience will genuinely like, and then you can promote it and get commission on every future sale made through your link, even months or years later. You can find products to promote through affiliate marketplaces like clickbank, but you can also try reaching out to businesses directly if there’s something specific you want to promote.
How much YouTubers make with this can vary wildly. If they’re using something like the Amazon affiliates programme, it won’t be a lot, possibly a few hundreds dollars at most, as they get a very tiny percentage of the sale. But if they’re promoting something like a digital course or software, it’s likely they may be getting 50% or even more of the sale, because the business doesn’t have any costs to make more copies.
The second way YouTubers monetize their channel is: sponsorships. Where, instead of getting a percentage of the sale, you get a fixed amount upfront to advertise a product or service within your video. Once again, don’t think sponsors are only for the big channels – a channel with 1,000 subscribers can get sponsorship deals, because it’s not just about the number of subscribers, it’s about how well the sponsored product matches the audience.
Of course, there are some brands that seem to dominate sponsorships on YouTube that you’ve no doubt heard many creators promoting, but again remember you can reach out to any companies directly and try to make sponsorship deals. However, we would recommend only promoting sponsors you actually think are good for your audience, because otherwise it will dilute the value of your recommendations. Whereas if you only work with sponsors you know will be worthwhile for your audience, it will mean it’s good for the audience, better results for the sponsor, and therefore more money and credibility for you. Everyone wins.
In terms of money, someone with millions of subscribers will easily be able to negotiate six figure sponsorship deals because every video gets so many millions of views. But even at around 10,000 subscribers you can still be getting sponsors around $1,000 if you have a highly engaged audience and a sponsor whose a great fit. Don’t undersell yourself – always ask for more money upfront so you have room to negotiate.
3. Patreon & Fan Crowdfunding
When you’re got fans who like your channel, a lot of them will be willing to donate money to help support you, in return for extra behind the scenes clips or earlier access to content. YouTube itself does have a built in channel memberships programme, along with paid super chats on live streams – but more creators seem to use Patreon instead. But let’s do the maths here, if fans gave just $5 a month for access to some extra bonus content – if 1,000 people join, that’s $5000 recurring every month. And so you can see how big channels with a lot of fans can drastically increase their income by offering this kind of thing.
4. Sell a product
Now, when it comes to selling products through your YouTube channel, most YouTubers go the route of selling merchandise. For huge channels it can be very profitable, but when you have a small audience, just throwing your brand name onto some random tshirt or mug probably isn’t going to make a lot. Some people have success by running limited edition merch campaigns, but what if you thought about selling a product that was directly useful for your audience?
One very profitable option is to create some form of digital course. Because if your audience enjoy your free YouTube content, it’s likely some of them would be happy to pay to learn more from you. This can apply in most niches – fitness, dating, business – if you are sharing knowledge on your channel, there’s a good chance people would pay for a full system where you can teach things more in-depth.
Once you start selling your own product, your revenue can really skyrocket, because now you’ve transitioned from just being a YouTuber, to running a YouTube business. Stop viewing your YouTube channel as a hobby or a job. Instead, think of it as a business. Because once you introduce all the different revenue streams we just talked about, especially the last one where you sell your own product, or even your own service like coaching – it becomes more than just a YouTube channel.
The YouTube videos become free marketing for the products and services you’re selling. And that’s where the real big money is. And let’s be clear: this definitely doesn’t mean your videos should suddenly start feeling like ads where you’re spending half the time just selling people things. But if you look at the creators who are making a lot of money, most of that income is not directly from YouTube, it’s because they’ve leveraged the attention their videos get.
If this is starting to sound a little overwhelming, then bear in mind that the very top channels almost always have a team working with them, they’re not doing it all alone. The reason they’re able to put out lots of regular high quality content because they have a video editor, a thumbnail designer, and so on – different people to help them run the channel and business, so they can scale much faster.
Because the more sales you get, the more you can grow your team and invest in making even better content, which in turn brings in even more sales and to the cycle repeats and your income keeps growing. So again, think of YouTube like a business. Don’t rely on ads, have multiple different revenue streams, especially a related product or service you can sell.
So you can see how you don’t need millions of views to make a lot of money on YouTube. You need the right approach. Choose a well paying niche and diversify on revenue streams, and you’ll be on your way to becoming a YouTube millionaire.