Tube Life: How YouTube Creators Make a Living in an Increasingly Crowded Space

More than ever before, YouTubers are competing for views as well as revenue. Sustainability depends upon factors such as brand deals and partnerships seeing as CPMs (cost per thousand impressions) on YouTube have dwindled over the years.

Sara Dietschy is a 22-year-old YouTuber. She has 236,000 subscribers and, several times per week, posts videos on travel, technology and things she likes. Chances are you haven’t heard of her, as there are now millions of people like Dietschy uploading videos to the platform.

And chances also are that YouTube will be even more crowded in the future: when 1,000 kids between the ages of 6 and 17 were recently asked what they wanted to be when they grew up, the top response was “a YouTuber.”

Canadian YouTuber Elle Mills has 471,000 subscribers and 38 million views.

Being a YouTuber in an era when everybody wants to be one

Dietschy, along with fellow YouTubers Dodie Clark and Andrew Gunadie (aka Gunnarolla) and YouTuber-turned-influencer marketing agency founder Rachel David, shared tales of the reality of being a YouTuber in an era when everybody wants to be one and ad rates for YouTube videos are declining.

As they explained during a Buffer Festival panel titled “What Creators Wish Industry Knew,” it’s a supply and demand issue. As the supply of video keeps growing, ad prices go down.

There was a time, several years ago, when a million views per month could be enough to pay the basic bills, but that is no longer the case. It now takes several million views per month, every month, to make a living based solely on YouTube ad revenue.

Paying the bills with ad revenue, but also deals and merchandise

So what’s a YouTuber to do? Several million views per month are nice if you can get them, but that’s not a view count that most can achieve. Instead, a sustainable career as a YouTuber now usually involves ancillary revenue streams, from activities like endorsement deals, personal appearances, merchandise and books. In other words, the individual becomes a media brand.

And, sometimes, it’s not even about a straight exchange of payment for promotion. Dietschy tells the story of a tweet she sent out in April of this year, proclaiming her love for flavoured water. She wasn’t getting paid by any brand to do this; she was simply putting her beverage preferences out there, and what happened, happened.

In addition to many retweets and likes, her tweet was commented not just by other flavoured water enthusiasts, but also by flavoured water brands, whose social media teams track keywords to strike up conversations on social platforms.

Among the flavoured water brands to jump into the conversation were LaCroix and Hint.

The next thing Dietschy knew, she was in a DM (direct message) exchange on Twitter with Hint Water, and it wasn’t long before she had boxes of their product shipped straight to her doorstep. There was no formal agreement between Dietschy and the brand, but that didn’t stifle her excitement.

She was thrilled to have a fridge stocked full of the new zero sugar zero sweetener beverage and shared that excitement with her hundreds of thousands of fans in the midst of a video dealing with an entirely different topic.

 

Will Dietschy (which rhymes with peachy, as she likes to point out) become an official spokesperson for Hint Water? Maybe a peach flavour? It’s certainly within the realm of possibilities and that could be where there’s a nice payday in it for her.

Searching for brand deals: the right targets for the right price

According to The Economist, the rate cards for brand deals with YouTubers look like this: those with 100,000 to 500,000 subscribers make about $12,500 per sponsored video; those with 500,000 to 1 million subscribers make about $25,000, and those in the ‘YouTube millionaire’ category—i.e., those with over 1 million subscribers—can secure six-figure deals.

 Canadian YouTuber Andrew Huang has 1,025,000 subscribers and 127 million views.

Rick Matthews, VP International with Kin Community Canada, a digital media company focused on content for millennial females, admitted during the Buffer Festival that the influencer marketing space is more crowded than ever.

“There’s a slew of creators and influencer agencies, so you really have to suss people out, particularly in Canada.” He went on to explain that companies like his, when pairing brands with influencers, are filtering things down to make sure target audiences are reached.

Furthermore, Matthews sees an evolution happening with creators, a term he says that he prefers over ‘influencers.’ “I see them as experts in what they do, whether it’s makeup or baking or whatever it is. And the evolution now is the creator’s larger personal brand beyond just making videos.” There are more creators than ever, but Matthews sees this as a good thing.

“It makes everybody up their game,” he says.

How is your influencer marketing budget going to change in 2017?

 Source: Linqia (United States; November 2016; 170 B2C marketers) via Statista

Posted in: Industry Transformations

Tags: advertising, cancon, marketing, youtube, youtubers



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