There are still plenty of skeptical people in this world who do not believe that it is possible to make money on the Internet. In reality, there are numerous success stories of people who have made their fortune online. YouTube is just one of many ways you can become an Internet sensation, and if you are lucky an Internet millionaire.
So just How Much do YouTubers Make?
Google pays out 68% of their AdSense revenue, so for every $100 an advertiser pays, Google pays $68 to the publisher. The actual rates an advertiser pays varies, usually between $0.10 to $0.30 per view, but averages out at $0.18 per view. On Average the YouTube channel can receive $18 per 1,000 ad views. This equates to $3 - $5 per 1000 video views.
In How To Make Money On YouTube: 9 Ways Influencers Monetize Their Youtube Channels we discussed how people make money on YouTube. However, just how much do they make? Well here's a Youtube Earnings Estimator you can give a spin - to find out how much Youtubers make exactly, read on;
Of course, for thousands of YouTubers, the answer is “nothing,” or “very little.” However, there are many YouTubers who make a comfortable living off their video channels. Moreover, of course, there is a small elite group who make an extraordinary income from the videos they create and post online.
When it comes to earning a YouTube income success breeds success. You will find that the hardest dollar to earn is your first. The more subscribers you have, the more people will click on your ads. The more people click on your ads, the more you make a name for yourself, the higher the likelihood of brands offering you sponsorship or merchandise deals. The better known your channel becomes, the greater your chance of joining a multi-channel network. It is like being on a giant upwards-climbing spiral.
Summary: Quick Jump Menu
What Can You Earn In Your Channel’s Early Days?
You are unlikely to be earning anything as you place your first video on YouTube. You are a video fledgling, and certainly a long way from being considered an influencer. However, everyone has to start at the bottom. Even PewDiePie was an unknown uploading his first video in 2010. He is now so famous that people make videos interviewing PewDiePie’s early subscribers, about whether they feel famous. Back at the beginning, he was still making niche videos in Swedish.
In theory, you can sign up for an Adsense account and enable your channel for monetization from the moment you create a YouTube channel. However, in practice, you are unlikely to make any real money until you have built up traffic to your site - and by that, I mean genuine traffic from people who watch your videos, not by taking the shortcut method of paying for views.
Although there are some adverts that are CPM (cost per thousand views), many are CPC (cost per click). For you to earn anything from a CPC ad, you need a viewer to click on the ad. In reality, only a small percentage of your viewers will click on the ads surrounding your videos. Even the CPM ads in the video itself require more than just a cursory glance. For it to be counted for payment, a viewer must watch them for at least 30 seconds (or half the ad for a very short video). Think how many people skip past the ad at the start of a video, thus wiping out any chance of payment to the channel. If viewers do click on or view your ads for long enough to earn income, you share any advertising revenue with YouTube. You will only get paid once your AdSense account reaches $100.
One area you might start to make money with a relatively small number of subscribers is if you pick a popular topic and participate in affiliate marketing. For instance, if your videos review a popular type of product, and you link to an affiliate sales page for that product you may begin to earn money that way.
For a rough idea of how much Youtubers make use the earnings estimator below and import the user's Youtube channel
Estimated Total Earnings by Channel
Estimated Total Earnings by Video
Of course some niches are easier than others to make money in, so if you are hoping to one day live off your channel’s proceeds it would probably help if you created your channel in a topic that interests people. Probably the most successful niche is gaming. Let’s face it, gaming is a huge industry in itself, and many gamers have reasonable levels of discretionary income to spend. Other successful niches include:
- Celebrity gossip
- Top [X] Lists
- Compilations of people’s fails (including amateur Jackass antics)
- Food reviews and kitchen hacks
- Product unwrapping and opening (particularly kids’ toys)
- How to demonstrations
- Animal activities, e.g. funny things your cats do
Moderately Successful Channels
With enough perseverance, not to mention on-camera talent, you should eventually pull yourself out of YouTube’s graveyard of poor performers. You should by this point be receiving some AdSense revenue every month, with affiliate marketing income too if you have chosen to go down that track.
However, at this stage, you are still mainly producing videos for love, with some other source of income paying your daily survival bills. By now you could be considered a minor influencer in your particular niche.
Once you have something like 20,000 subscribers, you might think about asking for crowdfunding assistance through a site like Patreon. The average Patreon contributor donates $7, with Patreon keeping 5% of pledges as a commission. It must be remembered, however, that if you are uploading videos on a regular basis, you are likely to receive recurring payments from your Patreon supporters. One example is The Comedy Button who currently has 5,266 patrons paying them $13,129 per month. This is a YouTube channel that has around 24,500 subscribers.
Once these channels begin to recognize success, they should be looking to do more with their AdWords, for instance deliberately chasing phrases with a relatively high cost per click (CPC). If they are a review channel, for instance, you could focus on reviewing products that attract ads with a higher CPC.
By now they could be famous enough for smaller brands to be asking the channel to endorse their products. Yet, these channels are still small, by YouTube’s standards, so income earned from sponsorship and product placement will still not be enough for the channel holders to live off.
Indeed, as Gaby Dunn writes about on Fusion, the middle years of a YouTube channel’s life are often the most difficult. The channel owners often need to work full time creating video content, but people only see them as mildly influential, and the channels certainly aren’t generating a full-time income. Dunn operates a channel with a friend, Just Between Us, which currently has 728,866 subscribers. You would think that would be enough to ensure financial survival. Yet, Dunn says that “despite this success, we’re just barely scraping by…but it’s not enough to live, and its influx is unpredictable. Our channel exists in that YouTube no-man’s-land: Brands think we’re too small to sponsor, but fans think we’re too big for donations. ”
Of course, it depends on who your audience is. One issue faced by quite a few YouTubers is that their supporters are naturally anti-establishment, anti-capitalist, and anti the idea that their YouTube heroes might be selling themselves out. Other types of channels, such as the review channels, the gaming channels, and of course anything business-related have it easier. Their fans expect these channels to make money, so don’t resist helping them out.
Success Begins at 1,000,000
Once a YouTube channel’s subscriber-count reaches the millions, life becomes easier for the owners. These channels are beginning to find fame and begin to become recognized as being influential in their niche.
1,000,000 subscribers sounds quite a few, but these channels are still not in elite company. There are now over 2,000 channels in the 1,000,000 + club. Some of these are official channels for offline superstars, particularly official music channels for the likes of Justin Bieber and Rihanna, but quite a few are simply everyday people who have built themselves a YouTube following.
Once you have a following of this size, you have the traffic to earn acceptable money.
Obviously, it is important for a channel to keep coming up with new videos, at least one to two videos per week. If a channel were able to get its entire fanbase of 1,000,000 to watch two new videos per week it would receive each week: $18 x 1,000 x 2 = $36,000 per week from AdSense alone.
Clearly, by this level a channel is also likely to have sponsorship opportunities, endorsements, and product placements. Many of these YouTube stars will also be well enough known that they can merchandise products to their fanbase, Any review-type channels of this size will often make good money with affiliate marketing, even if they are only tied in with Amazon, and their comparatively low 1 - 10% advertising payment rates to affiliates.
The YouTube Superheroes
Then there are the true stars of YouTube, some of whom receive a stellar income from their activities on the social network.
It is impossible to source exact incomes on YouTube - there are too many variables and undisclosed figures. However, there are plenty of websites that provide a “best guess” of the incomes earned by the leading YouTube channels. Forbes published a list of the highest paid YouTubers in 2015. The top ten channels managed to gross at least $2.5 million each in pre-tax earnings in the year ending June 1, 2015. Swede, Felix Kjellberg, better known as PewDiePie managed to gross $12 million in that financial year - not too bad an income for somebody who spends his days playing video games.
Forbes Top 10 Earning YouTube Stars of 2015 were:
- 1st: PewDiePie - $12 million
- 2nd equal: Smosh - $8.5 million
- 2nd equal: Fine Brothers - $8.5 million
- 4th: Lindsey Stirling - $6 million
- 5th equal: Rhett & Link - $4.5 million
- 5th equal: KSI - $4.5 million
- 7th: Michelle Phan - $3 million
- 8th equal: Lilly Singh - $2.5 million
- 8th equal: Roman Attwood - $2.5 million
- 8th equal: Rosanna Pansino - $2.5 million
In January 2016 Money Nation took out their financial calculators and estimated that PieDiePie was worth $78 million. He is an example of how you can build your income both directly from YouTube, and also the flow-ons as a result of your success there, over a series of years. According to Money Nation’s calculations his Net Worth has grown since he started his channel, as follows:
You cannot ignore the importance of his merchandise earnings. MoneyNation estimates his merchandise earnings over the period to be $41 million to go with the estimated $112 million he earned directly from his YouTube channel. They also calculate PewDiePie’s annual salary to be approximately $14 million.
While PewDiePie is the exception rather than the norm, his financial success has to be a good omen for all YouTube content providers. His figures should be aspirational targets for anybody starting a YouTube channel. Yes, it is hard to make money on YouTube. Yes, you have to work consistently, not just making your videos, but promoting them too, building up a relation with your audience. However, PieDiePie has proven that you can become successful on YouTube. You can be both wealthy and a key influencer to your fanbase. You just need to survive those lean early times and those difficult middle years. Those who make it through can prosper very nicely indeed.