It seems like everyone in 2021 wants to make money on YouTube. With creators like Mr. Beast and David Dobrick gaining unheard of YouTube fame, you may be asking yourself how you could earn money on YouTube. Well, you’re in luck. In this blog, I’ll take you through the five most popular ways your favorite YouTube stars make money (affiliate, sponsorship, ads, patronage, merchandise), and where to start if you are a beginner.
Making Money on YouTube in 2021
Step 1. Start your channel.
Believe it or not, this is probably the hardest part of making money on YouTube. Making a channel and putting yourself or your craft out there for the world to see can be scary, but it’s very worth it! In this video by Terry Warfield, he asked some successful YouTube creators for their advice on how to grow from zero subscribers. The tip that stood out to me most was Terry’s advice that “your biggest asset on YouTube is being YOU.” It’s a great big world, and odds are, there are people out there looking for content like what you might make! You also learn as you go, so don’t be hard on yourself if your first video isn’t perfect. Perfection can be the enemy of progress!
We asked one of our clients, Chris Brockhurst, for advice to a newbie creator and he said:
“Upload something and get the ball rolling… BUT make a channel about something you’re interested in, You hear every creator say it because it’s the absolute damn truth. YouTube is A LOT of work, WAY more than anyone outside of this world could think is possible. If you’re not into what you’re making and loving every second of it you will burn out and give up. It’s a harsh reality.”
So really, the first step to making money on YouTube is to get past the fear of starting.
How does one make money on Youtube as a beginner?
Okay, so you started your channel, now what?
If you are starting from ground zero, the first step is to make content. Additionally, it’s important to get your content in front of the right people to gain an audience. Hopefully, by now you’ve picked a niche that gets you excited and you want to make content about. So research what successful people in that niche are making videos about. You don’t have to do exactly what they are doing, but they should serve as good guides to what people are looking for. Platforms like TikTok are also awesome for observing trends and learning how the algorithm puts your videos in front of a relevant audience. In fact, it’s also a good idea to have social media associated with your account to gain an audience, read more about that here.
This of course will not make you money, but help you gain the audience and set the foundation for monetization later.
When I asked one of our clients, Blake Calhoun, from iPhoneographers when his YouTube channel pay off, he answered:
“The thing is it’s still a “side hustle” for me. I was just talking about this on Twitter recently. I don’t make enough to support my family and business on YouTube, so I still work as a filmmaker doing commercials, etc., however the last year or so I have been able to make more as my channel has grown. The key is to diversify your revenue streams and one day I hope to make enough to only do YouTube (although I’ll still always make indie films, but those come along every few years and aren’t a reliable way to make a living).
The main way I earn money now is YouTube ad revenue, affiliate marketing, sporadic brand deals (not many of these as I’m very picky) and then selling digital products and training courses on my website. In a lot of ways my YouTube videos work as a marketing arm for my other offerings. So it’s a win-win as I’m helping others learn mobile filmmaking and then making money doing something I love.”
So with that, let’s get into it!
Review a product in your videos
That brings us here. The first way to monetize any channel (big or small) is affiliate marketing. Have you ever been watching a YouTube video and the creator says “use the link in my description below!” I’m not a betting gal, but I’d be willing to bet if they say that, the link they are pointing you to is an affiliate link!
What does that mean? For the consumer, an affiliate link makes no difference price-wise (it will never cost you, the shopper, anything extra.) But if you shop with that specialized link, then the creator who sent you there gets a commission from the store since they were at least partially responsible for your purchase. Affiliate links are a goldmine for product review and unboxing channels because they can point their audience to the product they are reviewing easily. But, don’t count out accounts that aren’t dedicated to reviews. If you use a specific camera to record your video, or if someone likes your style, you can find affiliate programs for almost anything.
However, this path towards affiliate riches through product promotion can be a slippery slope. Authenticity is of utmost importance to fan retention. It is wise to only recommend products that you actually believe in and have tried yourself. Once you lose your audience’s trust, it is very difficult to earn it back.
Become an Amazon Associate
Becoming a member of Amazon’s affiliate program, known as Amazon Associates, is the best place to start as a creator. Amazon is the most diverse and biggest eCommerce store and marketplace out there, so finding the gear you want to link to won’t be too hard. This is simply because, is there anything that Amazon does not have? Additionally, their requirements for affiliates to join are not overly hard, and you can join fairly quickly! You just need an active YouTube channel, website, or social media account, and boom, you’re in. Something to be noted is Amazon requires three sales in 180 days to stay in the program, but that shouldn’t be too hard if you focused first on content and building an audience. Now there are some stipulations around HOW to share Amazon links, you can read about that in this blog we wrote about sharing links in your YouTube description.
Make a Kit
What you will begin to realize is that your YouTube description is super valuable but your space is limited! Not only by the character count but by your audience’s willingness to scroll. That is where sites like Kit.co come in. Kit is a platform where Creators can share the gear they know and love, with affiliate links! This means you can curate the various collections of gear you use, add your affiliate info to your account then use just one link in your YouTube description.
15 products, one link in his YouTube description.
Once your channel has grown a bit more and started to gain an international audience, another way that people make money on YouTube is by using Geniuslink. Geniuslink has helped creators big and small earn more from their affiliate links by helping them monetize their foreign viewers by routing their international clicks to the correct Amazon storefront via the appropriate Amazon affiliate program. (Psst, did you know that “Amazon” is really a collection of 19 different regional and independent storefronts and affiliate programs, each optimized for a specific region?!)
Something, not every Creator knows about Amazon is that they are storefront specific. This means that all over the world Amazon has launched individual storefronts that are optimized for its language, culture, and currency. The problem is when you become an Amazon Associate, you typically only sign up for your home countries affiliate program.
Meaning if you’re from the U.S. you probably signed up for Amazon.com, your Canadian friends can’t easily shop using your Amazon.com link as they prefer to buy from Amazon.ca – meaning you lose out on commissions.
Geniuslink not only fixes this problem by routing the clicks on your affiliate links to the right place, but it also provides you a handy dashboard to keep track of your traffic. Geniuslink does all the heavy lifting from an organizational side so you don’t have to worry about it.
Finally, the real game-changer from Geniuslink is Choice Pages. Choice Pages are great for YouTubers who are serious about using affiliate marketing as a main revenue channel and are looking to start to diversify away from Amazon. Choice Pages, a mobile-optimized landing page where a single product can be recommended with multiple different retailers gives you the opportunity to earn from multiple affiliate programs at once. This diversification has helped some to increase earnings per click from affiliate links by 2.2x! Once again, a Choice Page connects your audience to multiple options to buy from with a single link so you don’t waste precious space in your YouTube description, and you earn more.
Something that should also be noted is that when you are an affiliate, you need an affiliate disclaimer so whoever is purchasing from your link is aware that you are getting paid. Both Kit and Geniuslink Choice Pages have built-in affiliate disclaimers so you don’t end up in hot water with the FTC. Read more on keeping your Amazon Associates account in good standing here.
We might be a bit biased but we think affiliate marketing is one of the most important revenue streams any YouTube channel can use (regardless of whether you do something besides reviews/unboxing). It’s one of the very first revenue streams you can tap into. It can also become your most stable revenue stream with some diversification. Finally, it also scales with you up through when you have a million subscribers. Another small, but important, piece of using affiliate marketing as a revenue stream early on is that its ability to start to quantify the value of your channel so that you can negotiate appropriately for your first brand deal and sponsored content!
We surveyed 45 YouTubers about what percentage of their total yearly revenue comes from affiliate marketing. Here are their results:
Create Sponsored Content
Another way to make money on YouTube as a beginner or veteran is sponsorship. Sponsorship is when a company pays a YouTuber, often at this point also known as an influencer, to talk about the company’s product to their audience. This can work for large and small channels, in fact, micro-influencers see more interaction than larger influencers in some cases, making smaller channels, with a focused audience, very valuable to companies.
Companies typically look for channels that go with their niche, so when establishing your channel niche (like we talked about earlier) this will be important! When looking at your channel, it is useful to know who your audience is and why they watch your videos.
This is also where making quality content comes in. Not only from a filming and production standpoint, but brands believe their influencers represent them and their values. This is something to keep in mind when you think about how you conduct yourself online.
Now you may be wondering, “okay Teresa, that’s great and all but, HOW do I get sponsored, do they contact me? What do I have to do?”
Unfortunately, my answer is- it depends.
This is where it is important to have some kind of business email on your YouTube somewhere. Whether it be in your description or associated with your account, make sure there is a place to contact you, because some companies want to reach out and send you products! I used to work at a compression sock company and we would offer to send micro-influencers free socks in exchange for an honest post on Instagram about the socks. While getting free stuff is awesome, this is another time to keep authenticity in mind, don’t try to scam your audience so someone else can make a quick buck. Make sure the company reaching out gives you space for absolute honesty and you exercise that!
You can also reach out to companies directly, but be warned, if you do this then you should already have an audience that you have to convince them is relevant. Back in the pre-Covid day’s events like VidCon were great for this. Keep in mind networking never hurts!
I asked one of our clients Sidney Diongzon how he got his first sponsorship at 500 subscribers.
“For some reason in my mind, I thought when I hit a thousand subscribers, that’s when I’ll get sponsors to contact me. I was verging on 500 subscribers and was like “Okay halfway there, I really want to do that sponsored content, why do I have to wait? Maybe I’ll just reach out to them.” So I wanted to contact a backpack company that I really love and find a director of marketing. So I just Googled the director of marketing for this company, and then I found this person’s contact on LinkedIn. I actually called his cell phone number, he picked it up and I got so nervous. I was like “oh hi. My name is Sidney. I’m an up-and-coming YouTuber and I would really love to review your backpack” and I think because he was caught off guard, he was kind of forced to say yes, you know just to be polite. But that was my first sponsored brand deal! At 500 subscribers! I got to review a backpack and that’s when the sponsorships started coming in. Because I just went for it, you know? I didn’t have to wait for a certain subscriber number. I’m like, what’s the worst that could happen? They say no? Okay big whoop. So yeah, so that was my as my first sponsored deal.
It’s confidence…. There’s a good chance that they’ll say yes. Also just let them know hey, I want to tell your story. I want to tell the brand story because it actually helps me in my journey and think this would be perfect. I find that if you are confident or at least take it then there’s a good chance of you getting that brand deal.”
We did a survey with YouTubers to ask how many sponsorship deals they had done in the past year. As you can see below, a majority answered that they had done over 11 brand deals.
We followed up and asked how much of their revenue brand deals accounted for, which you can see the results below.
Adsense (YouTube Partner Program)
Now, YouTube does pay some creators for the ads they play in videos. This is one of the main ways people make money on YouTube.
However, there’s a catch.
The YouTube Partner Program (YPP) has requirements to join, most notably their watch time and subscriber requirements. The YPP requires an account to have 1,000 followers, and have more than 4,000 valid public watch hours in the last 12 months. YouTube shows you how close you are to these requirements in the Monetization tab in the YouTube studio.
Our client Chris Brockhurst was kind enough to share his earnings breakdown with us.
He has almost 50k subscribers and his revenue is:
“50% Amazon + BH Photo Affiliate sales (90% of which is US based)
10% Other Affiliate income”
Google has a handy calculator for creators to calculate how much money they would make from being part of the YPP. Our client Patrick Rambles even made a video on how much YouTube paid him for 100k views, for perspective.
The lesson here is it seems that it takes a bit for the YouTube Partner Program earnings to kick in right at the beginning, and affiliate is a great alternative for the early days.
Get Paid Directly
Another way to make money on YouTube is being paid directly. There are a couple of ways to accomplish this, and it can really improve your relationship with your fans since they will feel involved in your channel. However, if you have 0 subscribers, then it might be a slow start.
Patreon is a platform where you can allow your fans to become active participants in your work by offering them a monthly membership. They can purchase exclusive content, shoutouts, community, and behind-the-scenes footage of your work. This can work in a tiered system, making it affordable on many levels.
In addition to the obvious financial benefits of Patreon, there are community benefits for you too. Seth Godin (marketing extraordinaire) used to always teach “people like us do things like this,” Patreon takes that to a new level where you can literally create a community of fans. This can provide valuable insight into who truly subscribes to you, and make an exclusive community for people to want to join.
While Patreon is a great platform to promote crowdfunding, it has some drawbacks to be aware of. There is a monthly fee for you, the creator associated with Patreon in the form of a commission.
Luckily since it’s a commission, it does not cost you upfront, but it goes to show that “getting paid directly” is not always so direct. Additionally, people are very wary of monthly contributions, and the fact that Patreon is a monthly subscription might ward them off. That is why having a way for people to make a one-time contribution is also wise.
License your content to the media
Alternatively, you can license your content to make money off of it. Your ability to do this depends on your niche. Licensed content is content that someone has designated legal control over. Basically, if you took an awesome photo of a product, or generated some kind of content for a company, they could use that in their own marketing and would need to give you credit for its use. That credit can be whatever you deem fair. This is not recommended for a beginner but it is always good to keep in mind.
Sell your own merchandise
Finally, the last way to make money on YouTube is to sell your own merchandise. Like we covered in the Patronage section, having your own community of fans can be extremely beneficial! It’s important to establish a brand for yourself and your channel, that will make selling merchandise much easier. Do you have a phrase you use in your video a lot? Or would your fans be happy with something more specific to your niche?
One of our clients, Linus Tech Tips, sells an array of merch, he’s a quirky dude- so his merchandise matches his brand!
This article takes you through what to keep in mind as you design your merchandise. Most times, you will have to partner with a merchandising company to get your merch made, but whatever is left over after that is all yours to keep.
Another type of merchandise we have seen creators sell is not so tangible, but extremely valuable. Classes and educational courses are an awesome way to turn your passions on YouTube into a sustainable business.
Well, that’s all folks! As you’ve seen there is a multitude of ways to make money on YouTube, whether your channel is large or small. The thing you need to do now is to embrace Nike and just do it!! Get the ball rolling and see what happens. Making good consistent content is important, but you have to start somewhere! Who knows, you might be selling boxers with your initials on them someday like Linus Tech Tips.