Want To Make Money From YouTube? Work Hard And Be Amazing

Want To Make Money From YouTube? Work Hard And Be Amazing

Tomorrow, I’m speaking about “How to Make Money Off of YouTube” at Pubcon Las Vegas 2013. And, I figured that all of you would be interested in a sneak preview of some of what I’ll be presenting. So, let’s start by answering the question: “Do people who make videos on YouTube make money?” Yes, many of them do. In fact, thousands of YouTube partners are making six figures a year! I’ve written about several of these partners, including Demand Media and Ray William Johnson.

Based on what I’ve observed by watching successful partners, you need to do three key things to make money off of YouTube:

  • Create better content,
  • Build your audience, and
  • Turn your creativity into your career.

Ironically, only the second one of these three key things is discussed in detail in Version 4 of the YouTube Creator Playbook. It’s a great resource that compiles important tips, best practices, and strategies to help you build your audience on YouTube. But it’s virtually silent on how to create better content or how to turn your creativity into your career.

How Do You Create Better Content Than Madonna?

You’ll find “Create content that is unique, compelling, and entertaining or informative” at the top of the programming checklist in the Creator Playbook. But, you won’t find any suggestions on how to do this. And, even though YouTube’s Playbook Guides provide tailored strategies to help you build audiences if you already have music, sports, or education content and for existing media companies and nonprofits, YouTube doesn’t provide a similar guide to help individuals or organizations to select which content type or category to create. 

Perhaps, YouTube assumes that inspiration for better content springs from the head of Zeus. Or, maybe YouTube’s policy is to “Let a thousand flowers bloom.” Actually, I suspect that YouTube learned an expensive lesson from the YouTube Original Channel Initiative, which was announced by Robert Kyncl, Global Head of Content Partnerships, on Oct. 28, 2011.

Google invested $100 million in the program to bring even more talented creators and original entertainment to YouTube’s existing channel lineup, including channels created by Madonna, Ashton Kutcher, and Shaquille O’Neal. They came in five different categories: Pop culture, lifestyle, news & education, sports, and music. In 2012, Google invested another $200 million solely to market these 100 original channels. But, according to Ad Age’s weekly ranking of YouTube Original Channels, only the top 15 to 25 original channels are getting more than a million views a week.

Now, that percentage of hits might be okay if you’re a portfolio manager, but this batting average is below the Mendoza Line in baseball. So, how do you create better content than Madonna, Ashton Kutcher, and Shaquille O’Neal apparently did? And which trending and popular topics woulda, coulda, shoulda YouTube have selected to create a higher percentage of viable channels?

I believe the answer to the first question can be found by taking a second look at Ad Age’s weekly ranking of YouTube Original Channels and creating content that is at least as unique, compelling, and entertaining or informative as the top 15 to 25 channels. (My personal favorites are SourceFed, TEDEducation, and The Onion.)

And I believe the answer to the second question can be found by looking at the Top YouTube Collections. These Topic Channels are auto generated by YouTube. They are created by algorithms to collect trending and popular videos by topic.

Want To Make Money From YouTube? Work Hard And Be Amazing

Why does YouTube create channels by algorithms? That’s a great question. And I think the best answer was provided by Salar Kamangar, CEO of YouTube and Senior Vice President of Video at Google, in an interview with Peter Kafka of AllThingsD on Feb. 27, 2012. Kamangar said, “If you see a dog on a skateboard video, the CPMs, the cost per thousand impressions, are about $2. Now, if you package that as part of a dog lover’s channel or a skateboarding interest channel, that same video can command a $20 CPM.”

So, all you need to do is “follow the money“. When I double-checked over the weekend, there were 90 channels in the Top YouTube Collections. So, instead of sitting back and watching YouTube auto generate channels on the Practical Joke, the iPhone, and the Motorcycle, you could create a channel on one of these topics and start commanding a $20 CPM.

Tips And Advice On Building Your YouTube Audience And Revenue

Once you have learned how to create better content, then you’re ready to build your audience. For regular readers of ReelSEO, most of the important tips, best practices, and strategies for doing this are well known. If you are new to the site, let me quickly summarize them – and provide links to in-depth articles about most of them along with links to recent playbook updates.

Programming:

Optimization:

Community:

Turning Your Creativity Into A Profitable Career

In tomorrow’s presentation, I will also tackle the question: “How do you turn your creativity into your career?” Created in 2007, YouTube now has more than 1 million partners from over 30 countries around the world earning money from their YouTube videos. Thousands of channels like Michael Buckley’s What the Buck? are making six figures a year, but that’s less than 1% of all partners.

So, it’s important for partners to ask questions like: “Which types of video create viable channel strategies?” The best answer that I’ve seen to this question comes from the Pew Research Center’s latest report, “The Rise of Online Video.” It says, “For adult internet users, the most popular online video genres are comedy/humor, how-to, educational, and music videos.”

Want To Make Money From YouTube? Work Hard And Be Amazing

And, at Pubcon Las Vegas 2013, I’ll provide an example of a successful YouTube partner from each of these four categories.

In the comedy/humor genre, I’ll be highlighting Smosh’s YouTube channel, which has almost 12.9 million subscribers and close to 2.7 billion views. If video ads on the channel commanded a $20 CPM and YouTube split the ad revenue 50/50 with Smosh, then Smosh’s channel has made close to $27 million since 2005. (Yes, I realize that their actual earnings may vary, but that’s what the publicly available numbers would indicate.)

In the how-to genre, I’ll be highlighting Michelle Phan’s channel, which has almost 5 million subscribers and close to 794 million views. Using the same assumptions mentioned above, this means Michelle Phan’s channel has made $7,940,000 in ad revenue since 2007. And this amount doesn’t include any money from L’Oreal’s recent launch of a new makeup line designed by the YouTube beauty guru.

In the education genre, I’ll be highlighting Khan Academy’s channel, which has 1.4 million subscribers and 312 million views. Although Khan Academy ceased to accept advertising in 2010, the 501(c)(3) not-for-profit organization received $2 million from Google’s Project 10100 that year to support the creation of more courses, to allow for translation of the Khan Academy's content, and to allow for the hiring of additional staff.  In November 2011, the Khan Academy received a $5 million grant from the O'Sullivan Foundation. In April 2013, Bank of America and Khan Academy announced a financial education collaboration that will provide both bank customers and non-customers alike free, self-paced, easy-to-understand resources to develop better money habits. (Remember, this part of my presentation is about how to turn your creativity into your career, not just about how to make more ad revenue.)

And in the music genre, I’ll be highlighting Miley Cyrus’s channel on VEVO, which has more than 3.1 million subscribers and over 854 million views. That means it’s made $8,140,000 since 2010. Yes, I realize that the actress and recording artist has made more money from her contracts with Disney for the Hanna Montana TV series and movies, Hollywood Records for the Hannah Montana 2: Meet Miley Cyrus, Breakout, and Can’t be Tamed albums, as well as RCA Records for her latest Bangerz album. But that extra $8,140,000 has turned her creativity into careers for a small army of internet marketers and video content producers.

Finally, I'll be closing my presentation with Woody Allen’s all-purpose advice: ““The future holds great opportunities. It also holds pitfalls. The trick will be to avoid the pitfalls, seize the opportunities, and get back home by six o’clock.” Although Allen wrote “My speech to the graduates” for The New York Times on Aug. 10, 1979, it’s still pretty good advice for anyone who wants to learn how to make money off of YouTube today (or tomorrow).

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About the Author -
Greg Jarboe is president and co-founder of SEO-PR, a content marketing agency which provides search engine optimization, online public relations, social media marketing, and video marketing services.  Jarboe is author of "YouTube and Video Marketing: An Hour a Day". He is also a contributor to "Strategic Digital Marketing: Top Digital Experts Share the Formula for Tangible Returns on Your Marketing Investment" by Eric Greenberg and Alexander Kates; "Complete B2B Online Marketing" by William Leake, Lauren Vaccarello, and Maura Ginty; as well as "Enchantment: The Art of Changing Hearts, Minds, and Actions" by Guy Kawasaki. Jarboe is profiled in "Online Marketing Heroes: Interviews with 25 Successful Online Marketing Gurus" by Michael Miller. Jarboe is on the faculty of the Rutgers Center of Management Development as well as Market Motive.  He is also a correspondent for Search Engine Watch as well as the Knowledge Transfer blog. He is also a frequent speaker at industry conferences. View All Posts By -

What do you think? ▼
  • Tristan Shields

    What about music creators who aren't Miley Cyrus? As a YouTube music creator I need information and advice that's not, be Miley Cyrus ;)

  • http://www.katimorton.com/ Kati Morton

    Great article as usual. Love the material you guys put out. Keep at it.

  • http://Youtube.com/user/Pokeflirt Michael Vera

    Sweet article Greg!

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