A relatively recent phenomenon has been the rise in unlikely YouTube stars, as more people find unique ways to make money on this ever-growing platform. Over a billion videos are watched every day on YouTube, which has 2 billion logged-in monthly users and is on pace to earn $5.5 billion this year in US ad revenue alone. This staggering rise is consistent with a larger trend, which TvStartup founder Brock Fisher has described as the end of cable and satellite and the rise of OTT television.
TvStartup appreciates that successful internet TV means giving viewers flexibility in where, when, and how they engage with content. Many YouTube producers are similarly recognizing
the opportunities on this platform. This realization, combined with seeing people become YouTube stars and millionaires, are a couple of the reasons YouTube has become an increasingly popular way for people to share their talents, skills, hobbies, and just about anything else you can think of.
In 2019, Ryan Kaji, an eight-year-old with a channel focused on him unboxing toys, earned $26 million; Dude Perfect, five guys that do stunts and try to break world records earned $20 million; and Preston, who has a channel where he plays video games and does pranks, earned $14 million.
Clearly, the platform gives YouTubers access to billions of viewers and a variety of ways to make money. While many questioned whether YouTube could be effectively monetized, there are quite a few people that have figured out how to do this. Here are some of the ways that the most lucrative YouTubers are earning big bucks on and off of YouTube:
Brock Fisher of TvStartup recently noted that “advertisers are waking up to the possibilities of OTT,” and some of the most lucrative YouTube channels are powerful evidence of this. Ad revenue is a classic means for earning revenue, but as more people have turned to this platform and as the Adsense models have become more strategic and effective, YouTube producers are seeing this as an increasingly effective way to monetize their content. With a cost per thousand (CPM) model, producers make anywhere from 50 cents to $2 per 1000 views. This is done primarily through YouTube’s Adsense Programs, where ads are placed in videos and then earn revenue. As these models have become more advanced, both YouTubers and advertisers have found them increasingly frustrating because of the many restrictions placed by youtube. .
For less than 1% of YouTubers this is a lucrative revenue source for producers, however for most YouTubers it does not even pay the bills. However there are ways to make even more from ads. TvStartup helps YouTubers earn revenue in addition to YouTube Adsense, as it offers different advertisers that typically pay more than Youtube. What this means for producers is that they can make money from YouTube ads and make money by working with OTT companies like TvStartup to develop internet tv channels that go directly into people’s homes. This gives producers an additional ad revenue source, and often one that pays at a higher rate than YouTube Adsense.
Responding to the sheer volume of viewers that some YouTubers have, many corporations have begun sponsoring YouTuber producers to get more eyes on their products and to have their products associated with the latest YouTube phenomenons. Obviously, the key to these sponsorships is having a big following. For example, Anastasia Radzinskaya, who has $59 million subscribers, has landed six-figure sponsorships with both Legoland and Dannon.
As TvStartUp has appreciated, the key is having high volumes of viewers. Once you’ve got that, there are opportunities to build the right revenue model. This is why their team works with individual producers to create a custom internet tv platform, as it allows the flexibility that each team needs to meet their goals.
As YouTube producers develop engaged audiences and dedicated fans, they’ve also found that selling merchandise is a lucrative revenue source. Whether it’s shirts, hats, stickers, or bags with their name or an entire product line, plenty of YouTubers have turned to merchandise as a way to make money off of their YouTube fame. Jeffree Star, who earned $17 million last year, has a makeup line that has eight-digit annual revenues. Similarly, Markiplier, who has a high-end line of clothing for gamers, makes millions from these sales alone.
This is a less common revenue source and one that isn’t a good fit for all producers. However, those YouTubers with particularly engaged audiences and dedicated fans can earn substantial revenue from viewer donations. Patreon is a popular way for YouTubers to set this up, and the company takes a 5% commission on any donations. The average fan donation is around $7, so with the right volume of viewers and a particularly committed following, this can be an effective model.
Similar to sponsorships, some YouTubers work with affiliates to earn more money. When doing this, they’ll review or promote a product to viewers and then share a link to the product. The producer will get a certain portion of any sales that are done through their unique link. While producers can work with a variety of affiliates at once, it’s important to be strategic about these partnerships and to ensure that they are consistent with the channel’s brand and content.
The second-most visited online search engine, with billions of views per day, YouTube clearly offers producers access to high volumes of viewers and advertisers. It also offers a compelling proof-point about increased consumer use of online streaming platforms, and the number of YouTubers making millions offers clear models of creative and unique ways to monetize this free streaming.
TV Startup has long understood the potential in OTT services and has been a leader in the industry. Their full-service internet tv web and app systems offer producers more ways to build their channel, create positive user experiences, and implement an effective revenue model. Additionally, they have industry-leading personalization options and technology. To learn more about taking advantage of the major shifts in the way that people consume content and that producers make money off of content, contact TvStartupblogeditor