How much money do YouTubers make seems to be the number one question on many minds. Probably because we are all looking for ways to improve our financial condition. As we’ve discussed previously, a huge majority of us are living paycheck to paycheck. We’ve been talking on this blog about how to cover the gap between income and expenses, especially when we are carrying credit card or student loan debt. You can see some of that discussion here and here.
Before we move to a discussion about how much money do YouTubers make, let’s not forget that the first step to financial freedom is to assess your finances, create and follow a budget and reduce debt, especially credit card debt. If you are facing a huge pile of credit card bills, a debt consolidation loan may help you get on solid footing. Once you are less stressed, your mind will be free to begin the creative process of designing alternative revenue streams.
YouTube is growing in Strength
YouTube is the second largest search engine. With the new emphasis on video content, it stands a good chance of becoming the number one social network platform. In fact, with the recent changes announced by Facebook, YouTube could easily become THE place that people turn to for news and information. This means that YouTube could be a successful gig for you. If you hit it big, it could become your full-time profession. However, caution is warranted. Not everyone becomes so financially successful on YouTube that it becomes their full-time job.
But, honestly, how much money do YouTubers make? And, more importantly, how much money can YOU make on YouTube?
The YouTube Influencers Phenomenon
The first reality we have to keep in mind when exploring the topic of how much money do YouTubers make is to understand the phenomenal story of “influencers.” Who are these influencers and how are they able to make so much money?
Influencers are people who have become popular with a global audience. People follow them to find out what they think about certain products, brands, trends or to learn how they are dealing with various issues of life. They are making money full-time from their YouTube channel, not through advertisements, but from sponsored video and product placement. Once you acquire an audience of multi-millions, across the globe, brands will come to you to feature their product on your YouTube channel. Additionally, they will ask to air product videos on your channel. Brand videos can bring anywhere from several hundred dollars to thousands of dollars per sponsored video, depending upon the size of your channel. Ultimately, influencers begin to design their own products and sell them over the channel.
Among the most fascinating influencers are probably the kids, some of whom are not even old enough to write a check. Consider the amazing success of Ryan of Ryan Toys who is still in elementary school. He made $11 million last year and was placed at the top of the Forbes List of Kid Influencers in 2017. Ryan reviews toys. His channel has more than 10 million subscribers—kids I guess. Amazing huh?
Most people making money on YouTube are not earning full-time income and their revenue comes from the YouTube partners program.
YouTube Partners Program
Once you have your YouTube channel set up and approved, and you have an audience the most common way to earn income is through the “YouTube Partners Program.” If you are a frequent visitor to YouTube, you have certainly seen how this works. Before your chosen video begins, a short 20-30 second ad opens. This is the YouTube ad. You receive a percentage of revenue from the ads that run on your video. Your videos must be original content. You monetize your channel and advertisers can choose to run their ads on your YouTube channel.
If the advertiser pays you let’s say $100 to run the ad, then YouTube gets $45 and you get $55. On average, YouTubers earn between $1-$2 USD per 1,000 views of their video. If you build up your YouTube channel and reach millions of views per month, you could earn $5 per 1,000 views through the YouTube Partners Program.
This all sounds pretty good and straightforward, right? And, if you whip out your calculator and start doing the math, your mind can already start planning your tour around the world. BUT, of course, nothing is so straightforward, especially when it comes to the gig economy. The number-crunching is impacted by a number of factors, such as the location of your viewers, length of video, content type and what device is used to view the video. Here is a good snapshot explanation of these variables and how they impact your actual bottom line.
How Long Does it Take to Make Money on YouTube?
It can look pretty easy, right? Open your YouTube channel, start putting up some awesome videos, advertise it on all of your social networking channels, and sit back and enjoy the extra cash. It could be like that. When exploring the topic of how much money do YouTubers make, one can find stories like this. Timing is everything. In some cases, all it took was the right combination of personality, message and product endorsement.
However, even the leading influencers spent a few years building their subscriber base and developing engaging content before they hit the Forbes list. To build your audience you need unique, original and engaging content. You have to market your YouTube channel. This is not passive income. If you don’t see that you will have the extra time and mental energy at the end of the day or between your full-time employment hours, then YouTube may not be the vehicle for you to close the income gap. Affiliate marketing is a more passive way to earn extra income.
You need to also factor in your production costs. You need a high-quality video camera, special lighting, sound system, and an attractive space in which to film. These are upfront costs that you will recoup once you become successful, but keep in mind that at the beginning there will out-of-pocket costs. If you scrimp on these purchases and diminish the quality of your video, you also diminish the level of your income. Young teen influencers may manage to get away with minimal equipment and shooting in their bedroom, but this is not the norm.
New YouTube Changes
As with anything, success can lead to problems. The growth of YouTube channels and the financial success of channel owners unfortunately also led to some abuses, principally offensive content. In some cases, the content is illegal. Therefore, YouTube has announced a restructuring of the formula by which owners can make money. These changes will have more of an impact on you and other smaller, newer channels than it will the big YouTubers. Before you can monetize your channel, you must first have 1,000 subscribers and 4,000 hours of viewing time over a one-year period. The new rule applies to new and existing channels beginning next month.
How Much Money do YouTubers Make?
As you can see, the question is hard to answer. The big-time YouTube influencers are still going to earn millions of dollars and make it to the Forbes list. But remember, they have millions of subscribers with billions of viewed hours from visitors around the globe. It takes time, patience and most of all—commitment.