YouTubers are some of the most interesting online entrepreneurs in the world. But how do they make money? In this guide, we will explore the many ways that YouTubers make money. We will discuss advertising, sponsorships, and product endorsements. We will also look at other sources of revenue, such as merchandise sales and digital products. By the end of this guide, you will have a better understanding of how to make money with YouTube!
So What is YouTube Actually About?
Before we get into how to make money from YouTube, we’ve gotta know what it is and what it isn’t. YouTube is a video-sharing website where users can upload, share, and view videos. But you know that already.
As a normal user of YouTube, you simply go there and can watch videos about anything you want, right? You might have a question about fixing something at your house and you search on Google for the answer. Up pops a YouTube video that walks you through the step-by-step process. Historically, we would have to read through a manual or booklet to find the answer to many of these questions. Now, with YouTube, you can follow along with someone doing the exact thing you asked a question about.
The way I view YouTube is that it’s a sort of visual search engine. Many of us are visual learners, so YouTube is perfect for this style of teaching. Instead of having to read through paragraphs about how to do something, you can watch a short little video that explains it.
How do YouTubers Make Money From Their Videos?
There are many ways that YouTubers make money. The most common way is through advertising. YouTube sells ad space on its platform to businesses who want to reach YouTube’s huge audience. When a YouTuber makes a video, they can choose to allow YouTube to sell ad space on their video. When someone watches the video and sees the ad, the YouTuber gets paid. The payment isn’t instant though, you’re paid via direct deposit monthly for the previous month’s earnings.
In order to qualify to get paid from YouTube, you’ll need to have at least 1,000 subscribers and have 4,000 hours watched of your videos in the last 12 months. Once you reach this threshold, you can apply to be a YouTube Partner. If approved, you’ll be able to start making money from your videos!
Getting paid from YouTube ads is one of the easiest ways that you can make money from your YouTube Channel. It’s not necessarily the most profitable though. As with most things, you can find other opportunities to be paid more for your videos.
Sponsorships
Another way that YouTubers make money is through sponsorships. A sponsor is a company that pays a YouTuber to promote their product in a video. This could be anything from energy drinks to clothes to gaming consoles. Usually, the YouTuber will mention the product at the beginning of the video and then use it throughout the video. Sometimes, they will even do a whole video dedicated to the product.
Some YouTubers get sent free products along with the ability to become an affiliate for the product that they do a sponsorship video about. You’ll recognize this whenever you watch product review-type videos. The creator might say something like “use my code to order and you’ll get a bonus”. That’s how the sponsor can track the sales from the video.
Endorsing Products
YouTubers can also make money by endorsing products. This is similar to sponsorships, but usually, the YouTuber will only mention the product at the end of the video. They might say something like, “I used this product in today’s video and I loved it! If you want to try it out for yourself, you can use my discount code.”
You don’t need to be sponsored to endorse products. You just need to be an affiliate. For example, I have a YouTube channel that teaches people how to juggle. I have done some videos where I’ll review the products that I have bought and used. I then mention if people want to buy them, they can use the link in the description. The link will lead them over to Amazon where I’ll earn a small commission if the viewer chooses to buy from my link.
You can do product reviews of other things as well. For example, I made a review of one of the services that I’ve used for years, Clickfunnels, and promote the product in the video. If someone uses my affiliate link for that, I’ll get a recurring commission for as long as the person uses the product. If you can create useful guides and helpful tutorials of products that pay recurring commissions it can really add up.
Selling Merch and Digital Products
Other ways that YouTubers make money include selling merchandise and digital products. Many YouTubers have their own lines of merchandise, such as t-shirts, hats, and phone cases. They sell these items on their website or through a third-party website. You can use sites like Gearbubble or TeeSpring to set up a print-on-demand store.
YouTubers also sell digital products, such as e-books and courses. These are usually products that teach their audience how to do something, such as start a YouTube channel or grow a following on social media. There have been many great examples like Lost LeBlanc did with building up his YouTube channel and now teaching people how to Become A World Class Content Creator & Make Money From Anywhere.
Coaching and Consulting
Another way that YouTubers make money is by offering coaching and consulting services. This could be anything from one-on-one coaching to group coaching to teaching courses. These are usually done through Zoom calls or Google Hangouts. Once you build up an audience in your niche, people might want to work with you personally to help solve their problems.
The Types Of YouTube Channels You Can Create
There are a few different types of channels that you can create. The two I’m going to focus on are cash cow channels and tutorial channels. I don’t want to overwhelm you and have you think you need to spend hundreds of thousands of dollars like Mr. Beast to create videos. You also don’t need to have a super fancy camera for these channels.
Cash Cow Channels
A few years ago I came across a kid who introduced me to the idea of Cash Cow YouTube channels. Basically, he and his team would create strictly for entertainment videos and channels. The kind of channel where it might be “Top 10 ___________” and just a ton of content that can go viral. I liked that idea and now I have 2 channels that are mini Cash Cow channels that I am actively growing.
To create a Cash Cow channel, you’ll need to pick a niche and then create viral content around it.
You’ll want to publish a lot of content if you choose this route. The kid who I learned this from has a full team now that publishes 1-2 videos a day. Personally, for my mini cash cow channels I’m only able to publish 1-2 a month because I’m very conservative with my investment in these channels. I’m paying someone else to create every single video and it takes me on average 10 months to break even with every video. If I have a video go viral, I’ll purchase another 1-2 videos for that month. However, I’m taking about half of the earnings from these channels to reinvest in dividend-paying stocks.
You can re-purpose other people’s videos if you are adding unique content and/or commentary to the video. You can also do these as faceless channels so you don’t personally need your face to be in the video. You can do simple screen recording stuff and use a microphone.
Tutorial Channels
Another type of channel that you can have is simple tutorials. One great example of this is the channel, Dad, how do I? You can click that link to open up the channel, it’ll open in a new tab. Take a quick glance (don’t watch them yet) at the channel. It’s just a bunch of useful videos. There’s stuff like how to install a kitchen faucet and how to fish.
The Dad, how do I? channel is just helpful stuff that a kid might ask their dad for help with. If you have a certain skill set that others ask you questions about pretty often, you could make a channel about it.
My Juggling Secrets YouTube channel is mainly a tutorial channel with a few product reviews as well. I’m just teaching people how to juggle, something that I’ve done since I was 8 years old. You might have something that you’ve done since you were a kid that you’re really good at. That could be your idea for your channel.
You don’t need to be on the camera for these tutorial channels if you are doing computer or tech tutorials. If you are great with setting up websites, you can record your screen and walk people through the process of building a website. You can do the same by walking someone through writing code or doing something else on the screen.
The Overall Idea/Plan For Building a YouTube Channel
The idea is to build a channel with the intent of making money. You are not going to make any money if you don’t have any viewers.
After you chose a niche to create videos about, it’s time to dive in and start creating. Go out and find other popular channels in your niche and see what they are doing right. Also, take a look at some of their older videos and see how they’ve evolved over time. You might notice that one particular trend in the niche gets way more views than other topics. Take those ideas and put your own unique spin on them.
If you’re doing a channel about something you’re very knowledgeable about, grab a pen and paper and write out every single question that people ask you about the subject. Each of those questions can be turned into a video. If you go into this trying to genuinely help people, you’ll do better over time because people will see you actually care.
For one of my Cash Cow channels, I aim to make $10 a month for every new video that gets uploaded. Yes, that’s not “insane” money, but if I have 100 videos that each earn me $10 a month, that’s an extra $1,000 a month. Many people who are selling internet marketing courses and stuff always talk about “$10,000 months”. If I earn $10 per video, that just means I need to create and upload 1,000 videos right? Once you dial in the numbers in your niche, it can become that simple. It’s simple, but not easy.
I put together a simple course that explains my process here if you want to learn more about what I’m personally doing.