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When YouTube launched in 2005, it struggled to find its footing. It wasn't the first video sharing site on the internet, and it didn't have the backing of a major content creator like early competitors did. If you'd told friends at a dinner party 15 years ago that you planned on making a living creating YouTube videos, you probably would have been laughed out of the room.
In hindsight, you would have been a visionary. As of May 2019, YouTubers are uploading over 500 hours of video every minute. And much of that content drives revenue for its creators.
But how do you make money on YouTube? In this guide, we'll discuss some of the biggest YouTube revenue streams and show you how you can get in on the action.
Yes and no. There are dozens of revenue streams associated with YouTube—both official and unofficial—and some of them make it easier to get those first dollars than others.
Official YouTube revenue streams like paid ads require you to hit specific milestones relating to subscribers and engagement. Tangential revenue streams like affiliate links are easier to get started with, though you still have to put in work to start making money.
Regardless of the revenue stream, it requires time, dedication and effort to make more than a little bit of fun money on YouTube.
The most common way to make money on YouTube is through ads. To start making money via YouTube ads, you need 1,000 subscribers and 4k watch hours within the past 365 days of your YouTube channel. That ends up being just under 334 watch hours per month or just under 11 watch hours per day.
As you can see, that doesn’t say anything about how many views you need on YouTube to monetize your channel. That’s because the number of views doesn’t matter. If you have a lot of short videos, you’ll need more views to get to 4,000 watch hours. If you publish a few long-form videos and can keep viewers watching for the entire video, you won’t need as many views.
Views do start to matter when you’re able to monetize your channel. When you reach that baseline of 1,000 subscribers and 4,000 watch hours, you’ll be able to see a few new metrics in your analytics dashboard. One of those is RPM, which stands for Revenue Per Mille (mille means 1,000 views). Your RPM will tell you how much you make on average for each thousand views your channel gets.
The YouTube revenue dashboard shows estimated revenue, rate per mille, and playback-based cost-per-mille.
So, how many YouTube views do you need to make $100? If your RPM is $4.21, like in the above screenshot, you’d need 1,000 views to make $4.21. To make $100, you’d need 23,753 views.
We’ve mentioned that you can start earning YouTube ad revenue once you reach 1,000 subscribers and 4,000 watch hours. But that’s a bit of a simplification. Once you hit those milestones, you can join the YouTube Partner Program, and ad revenue is only part of your revenue opportunities in the program.
Another revenue stream in the partner program is YouTube premium revenue. This is a little less clear than the ad revenue, but basically, users with YouTube Premium get to skip ads. In order to make sure their partners still get paid, YouTube will still share some of that YouTube Premium money with you when those users watch your content.
You also can start earning income from “Super Chats” during your livestreams and video premieres on YouTube. A Super Chat is essentially a tip that your viewers can send you in the live chat that happens during streams and premieres. YouTube takes a pretty hefty cut from Super Chats—up to 50% on smaller Super Chats with the percent declining along with the amount—but it’s an easy way for your viewers to chip in some cash.
Though many creators focus on building up their subscribers and watch hours so they can qualify for YouTube ad revenue, creators don’t have to wait for official YouTube monetization to start making money on YouTube. YouTubers can start making money on day one of their YouTube channel by selling merch, implementing affiliate marketing links and more.
The merch you make and sell for your YouTube channel should be a reflection of your style and voice. You can start simple with merch that features your logo, but you might quickly decide to expand into catch phrases, memorable quotes and even fan art designs (with permission, of course).
There are two ways to sell merch—the traditional method, where you order a set amount of merch and ship it yourself as orders come in, and dropshipping.
With dropshipping, a website like Printful prints products as people order them and ships them out for you. That means you never have physical products in your possession. As a result, the base price of each merch item is higher, but you don’t have to gamble with guessing how many of which sizes to keep in stock or deal with shipping.
If you start to sell a lot of merch, you might want to start placing your own orders so you can get more revenue, but dropshipping is a great option for anyone who’s unsure of how well their merch will sell.
Sponsored videos and paid product placement are a great opportunity to earn revenue with your YouTube channel. And, you might be able to snag a few sponsorships earlier than you’d think. It’s common to get $20-30 for every thousand views you get on a video.
Even if you’re not at a thousand views per video, you could still earn a few dollars per video posted, which adds up. You could also forego money early in your YouTube career and do sponsorship in exchange for product reviews, demos or shout-outs.
Crowdfunding using websites like Kickstarter are an extremely popular way to raise money for other creative projects. Whether you’re trying to fund an album, a movie or a new microphone, you can use YouTube to promote your crowdfunding efforts.
Affiliate marketing is the process of having your viewers buy products from certain websites using a unique link. In turn, the website gives you a percentage of sales from those purchases. It’s a largely passive revenue stream with a lot of earning potential.
Finding affiliate marketing sites and programs is pretty easy. The most popular affiliate marketing program is Amazon’s, but there are also websites with affiliate marketplaces that can fill a wide range of niches from gaming to music gear.
An affiliate program dashboard might include clicks, purchase amount, and earned or pending payouts.
You need to apply to most affiliate programs, and some have minimum earning requirements. A few examples of affiliate programs and marketplaces include:
You can start earning money from affiliate programs on the first day of your YouTube channel. Just remember to include affiliate links to any products you mention in your videos and equipment used in your video description so viewers can find those links. It also helps to shout-out those links during your video so viewers know to look and use them.
Be sure to make it clear that using those affiliate links doesn’t cost your viewers any extra money, but that it does help support the channel. You may find that a lot of your viewers want to help you out however they can, and if they can support you by making purchases they were already going to make, they likely will use those affiliate links whenever they can.
If you’re not familiar with licensing content, here’s a quick lesson. A license is permission you grant to let someone else use content that you create and for which you hold a copyright.
For example, let’s say you film eight-hour videos of birds eating birdseed for your “TV for Cats” YouTube channel. If you don’t use any outside music or imagery, you own the copyright for those videos. By uploading your videos to YouTube, you grant YouTube a license to use those videos.
What a lot of creators don’t realize is that you can license your content out to other creators for a fee that you set. You’ve probably heard of stock photos, but stock videos and stock music are huge markets that you can try to cash in on. You see stock footage every day—it’s often called b-roll and it’s used in TV shows, movies, and commercials.
To effectively license your content, it helps to have a website that you can process transactions through. We’ll get to that later.
As your channel grows in popularity, you might be able to find opportunities for paid meetups and other speaking engagements. In-person and digital conferences exist in every niche you can think of, and there are probably several that could apply to you.
If you want to get into paid speaking engagements, start small. Check out local and smaller digital meetups and pitch a few ideas for panels or talks. Meetup.com is a great place for this, but you might also find Facebook groups or ask around within your community for those smaller gatherings. Once you start to get your footing, message the bigger speaking opportunities to get on their radar.
Instead of starting with selling, first focus on perfecting your craft, building your audience and growing your professional network. One opportunity can lead to another, and you could be racking in those paid engagements before you know it.
While it’s free for folks to subscribe to your YouTube channel, a few of your biggest fans might be interested in supporting you on a regular basis. This is where sites like Patreon and YouTube’s own channel membership come into play.
Offering different membership levels and rewards can convince your fans to support you on a regular basis.
You can start a Patreon no matter how big or small your channel is. But how does Patreon work? Essentially, fans subscribe to certain support levels that you set yourself. Often, these levels come with a perk, such as merch, exclusive content or access to a private Discord server. Patreon takes a payment processing fee and a small portion of the proceeds (between 5-12% depending on the features you want), and you get the rest.
YouTube channel memberships require you to have at least 5,000 subscribers (or 1,000 for gaming channels). The seamless integration with YouTube is tempting, but they take a 30% cut of your membership fees and have tighter restrictions on what perks you can offer subscribers. For example, YouTube doesn’t allow channel member perks like one-on-one meetings or contests.
You’ve probably noticed a theme in this guide so far—there are a lot of revenue streams related to YouTube that aren’t specifically part of YouTube. Expanding your brand’s reach beyond YouTube can help you sell merch, get sponsors and more. Here are a few tips that can help you start earning real money from your YouTube videos.
We can understand why some YouTubers would hesitate to create a website. It’s a new skill you might have to learn—though there are easy website options like Wix and Squarespace—and having a unique web domain costs money. But having your own website can pay for itself more quickly than you might think.
A few benefits to keeping your own website include:
Even if the bulk of your content and audience is on YouTube, it’s important to keep your supporting social profiles active. Building audiences in multiple places is appealing to potential sponsors anda great way to push traffic to your videos and revenue streams.
Other social profiles are also a great way to connect with different audience demographics. Different social networks skew to different audiences, and you might find that your Instagram audience has a lot of younger women while your YouTube audience is older and male. By promoting your videos on Instagram, you could reach an audience that might otherwise miss out on your content.
Keeping an eye on your analytics is key for growing and monetizing your YouTube channel. From a growth perspective, seeing which videos performed best and whether there seem to be ideal days and times to post videos can help you pivot to more successful content.
YouTube analytics can give you information that can help you grow your channel and attract sponsors.
From a sponsorship standpoint, understanding who’s watching your video can be key to closing deals. Different brands want to appeal to different audiences.
For example, if you have a guitar-based YouTube channel that has a high number of young, female subscribers, you might be of interest to guitar brands that are trying to reach more young women. Meanwhile, a legacy brand with more expensive instruments may be more interested in your channel if your audience skews older and wealthier.
We recommend creating a one-sheet or slide deck of audience statistics that you update every few months. It could compel potential brands to sponsor you or send you products to use in your channel, even if you don’t already have an existing relationship with a specific brand.
Social networks have given creators an unprecedented ability to reach potential fans around the world. But when you’re relying solely on YouTube or a social network to tell your fans about your videos, you’re essentially renting a fan base.
Sites like YouTube have put a lot of time and money into building their user bases and they’re increasingly asking creators to pay to reach all of their fans. But, you don’t have to shell out for boosted posts to grow your fan base.
By funneling your social and YouTube fans to an email list, you have more control over when and how you reach your followers. And, brands love email lists. If you can grow a significant email list, you can increase your value to potential sponsors. It could help you land those lucrative sponsorship slots.
You can also use your email list to sell your own merchandise, promote your content and endeavors, and encourage people to join your Patreon. One quick tip about email lists, though—focus first on creating engaging content for your emails. You need people to want to open and read your newsletters before you can monetize your list!Now that you know how to make money on YouTube, you should make sure you have the right equipment for your channel. After all, it’s easier to draw in subscribers and sponsors when your videos look and sound their best.