YouTube is a massively popular website that has changed the way we consume media forever. From music and gaming, to tutorials and comedy, YouTube captures three-hundred hours of video content every minute.
To state the obvious, YouTube continues to grow year after year. They currently have more than one-billion users.
That is a whole lot of activity in one place. YouTube is even bigger than Facebook.
The size of YouTube is hard to ignore.
If you have even the slightest bit bit of creative energy inside you, then you have definitely wondered if it was possible to make money on YouTube. I know I have. So I decided to find out.
There is a lot of speculation online — major media outlets, websites, bloggers, and even YouTubers, claim that YouTube is the place to be, but I wanted to see for myself.
Making Money On YouTube – The Success Stories
You can find plenty of examples of people who became famous online thanks to YouTube.
Maybe you have heard of popular channels like PewDiePie, Jenna Marbles, or Wheezy Waiter. And that’s just a few off the top of my head. There are plenty more.
Justin Bieber also got his start on YouTube. Lots of people already know this, so I won’t waste too much time talking about it. But the gist is that Justin’s videos were first uploaded to YouTube, then found by a talent manager, and finally by Usher.
Obviously, things worked out quite well for Justin. But Justin doesn’t make his money from YouTube. He makes it by touring, and selling records.
In 2008 YouTube released the Partner Program, making it possible for select YouTubers to monetize their videos. Since then, they have allowed more and more video creators into the program by lowering requirements.
Now, anyone with a channel in “good standing” that uploads original content can enroll to be a YouTube partner, and monetize their videos with YouTube ads.
That gives us a definite Yes to the question, “can you really make money with YouTube?”
So then, the question becomes…
How Much Money Can You Actually Make?
This question is a little more difficult.
Pretty much any site that lets you upload content and place ads on it will pay you to do so. However, that usually means very little.
It’s easy to find sites that will pay you for your content. Will it be worth your time? Probably not.
With all the notoriety some YouTubers get, it seems like YouTube might be the exception.
Felix Kjellberg, better known as PewDiePie, runs the the most popular channel on YouTube. He’s even been on SouthPark (that’s how you know you’ve made it).
Reports suggest that PewDiePie made $7.4 million dollars this year.
PewDiePie released his own video, commenting on the reports, but he never denies it.
Jenna Mourey, better known as Jenna Marbles, runs one of the most popular comedy channels on YouTube. All her videos combined earned her one-million views each day in 2014.
Those views are said to have earned about $350,000 that same year.
I don't follow any of those channels, but one channel I do follow has about 700,000 subscribers. Though the owner hasn't disclosed exactly how much he makes, he's hinted at a multiple six-figure income. Yet probably one of my all time favorite channels, h3h3productions just hit 400,000 subscribers and claims to be poor, plus also asks for money on Patreon.
And there are probably several other channels we can talk about that produce similar results, but because of Google’s policies, YouTubers are not allowed to discuss how much they make from YouTube.
I think it’s fair to say, you can earn a lot of money from YouTube, but don’t go breaking out that old handheld camcorder just yet.
For every YouTuber that makes thousands of dollars, there are thousands of others who make nothing. And it's pretty impossible to tell what the small guys are earning. With 1,000 or 10,000 subscribers, could you actually make enough money to earn a full time living? It's hard to tell since ad revenue earnings are all a big secret.
How The Money Making Process Work?
It’s worth mentioning that YouTube is owned by Google, and like other web-based properties owned by Google, its revenue is generated from ads.
It’s not as simple as making a video and getting paid; YouTubers get paid for the ads that show up on their videos. Some get paid for clicks on those ads, while others get paid per view.
In either case, you need views, which means you need viewers.
Although YouTube has no defined ‘earnings per view’, or ‘per click’, you stand to earn about $1 per thousand views. But again, that is just an estimate I've heard kicked around a few times.
YouTubers like the ones I’ve mentioned have been making videos for years. Jenna Marbles and PewDiePie have been uploading their content for more than five years. They have thousands of videos which generate pennies, adding up to decent incomes they can rely on.
If you had 1000 videos, with 10,000 views each per month, that's about $10k/month that you could be earning. In the beginning however, you'll find that a few videos hit paydirt, and some are just not popular. It takes a large number of subscribers to generate tens of thousands of views on a regular basis.
And although it seems like YouTube are really bringing home some bacon, there are some things to consider.
YouTube Takes 45%
With the reports claiming YouTubers make millions, none of them can say whether or not that income is being calculated before of after YouTube takes their percentage.
All the reports I’ve seen are basing their estimates off of each channel’s view count, which means those are probably gross wages, which means the YouTubers actually only get about half of what the reports say.
Still though, for popular channels, there’s still lots of money left. Right?
Other costs not considered in those reports are taxes, equipment, props and help.
Taxes alone are enough to really eat up some of that money.
On top of that, YouTubers are always buying props, including friends in their videos and buying outfits, like costumes. Coming up with new content is a huge killer of channels that simply cannot think of things to post.
Consistency is key, and it's well known that a way to “game” the YouTube algorithm and get good placement on things like recommend channels/videos is to put out content regularly.
Once you start getting into the creative side of videos, this can mean expenses for travel, editing time, gear, and other things involved in production. Even something like filming extremely simple an unboxing or shopping haul involves actually buying stuff to show.
Now you have a real business where you have to manage cost to product and expected profits.
Other Ways to Make Money with YouTube?
You don’t have to get paid directly from the ads on your videos to make money with YouTube. If you have a YouTube channel with subscribers
Once you gain a following, companies will approach you to feature their products on your channel. Though you can earn a commission per sale, as with any other affiliate agreement, some companies could pay you a flat fee, without any promise of sales numbers.
This fee could be based on how long you feature their product, or what type of video you do. For example, a 10-minute dedicated review video on your channel could earn you thousands of dollars, depending on the size of your audience.
A 30-second spot alongside multiple other featured products, like with “shopping hauls”, would probably earn much less.
Affiliate Links In The Comments
Affiliate programs are free to sign up for, and span the entire spectrum of what type of products you can promote. Not all of these companies have the resources or knowledge to approach YouTubers, so they wait for you to sign up.
You take care of all of the marketing aspects, and get paid a percentage per sale that ranges from 5% to 75% depending on the company.
The good thing about this style of affiliation is that generally speaking, you have free range of how you promote products. You can just add a link to the description, or do a video review, or many other strategies. Whatever you can cook up!
You only get paid per sale, so companies are not too worried about how you spend your time and resources to promote them, as long as it's ethical and not disparaging their product. Usually, honest criticisms are and comparisons are fine!
Drive Traffic To A Website or Email List
You could do none of the above, and simply leverage your channel to grow a website. A website is a very powerful tool, and guess what – it's not owned by Google. One of the troubles with YouTube is that they can bring down the ban-hammer without any consequence.
They're a private company so it's not infringing on free speech. You know the line. So if your video contains any controversial material, or you get flagged by a bunch of trolls, your ad revenue might dry up.
That's why I highly recommend building a website and starting an email list (at some point). This diversifies your traffic and income sources. YouTube is great for ad revenue once you get your subscribers up, but you're in a precarious position when your entire business model relies on a single company hosting your content.
Combination Of Money Strategies
Instead of choosing one or the other, you can actually do both Google ads and affiliate marketing. Many YouTube viewers are used to viewing ads, and there's no reason to leave money on the table if you think you can earn some pocket money this way.
Enable ads on your channel, and follow up with affiliate strategies like placing links in the description and directing people to your website.
An Example Please…
There is a channel called, The Sports Geek, which I wrote about in my post about making money with DraftKings. He's doing a great job of combining muldiple methods of earning money online.
Kevin, (owner of The Sports Geek channel), loves talking about fantasy football, and other sports. He uploads videos in order to attract people who are interested in the same things he is.
Doing this allows him to build his business, his personal brand and an email list, which he can monetize through affiliate marketing.
Kevin uses YouTube as a way to get viewers back to his website. Once he’s done that, he can develop a different kind of relationship with them and possibly have a viewer/reader/fan for life.
So he's got money coming in from all directions:
- YouTube ad revenue
- Affiliate ad revenue
- Adsense Ads on a website
- Affiliate links on a website
- Email lists for daily/weekly/monthly promotions
If one month of ad revenue is slow, he's got other things going to pick up the slack. If one place decides they won't feature sports betting ads, he's got other income streams to keep him afloat while he tries new strategies.
As of right now, there aren't many choices when it comes to making money with video content. YouTube definitely dominates. Here are a couple alternatives worth considering though. YouTube can't dominate forever, and these video platforms offer a couple advantages.
DailyMotion is probably the second most popular video sharing website, and they have a similar monetization setup to YouTube. The trouble is their user base is much smaller. That means fewer eyeballs, and lower bids for ads.
Vimeo is a premium video sharing platform, and doesn't not pay you to upload content. Uploading to Vimeo could make you money if you owned your own website and used the videos as a vehicle for content on your website to drive ecommerce or affiliate sales.
DTube has some potential, but is still in its infancy. It uses the Steemit platform, meaning you'll get paid in cryptocurrency. Steemit blogs rank pretty well in Google, so I see the potential for decentralized video being a superior alternative to Google-owned YouTube. The audience size just isn't there yet.
Twitch is the strongest alternative for earning money right now. You can make money on Twitch in a variety of ways including ad revenue, affiliate commissions, donations, and sponsorships. Twitch is focused on streaming video games, but there is a variety of content styles you can explore.
YouTube is awesome, and yes, you can absolutely make money with a YouTube channel. In fact, there are so many ways to make money, that you really need to start looking at it as a business venture, not just some funny person behind a camera.