There are several ways to make money from YouTube videos and YouTubers with large followings can earn millions of dollars. The payment mechanisms used by the high-flyers can also be used by small contributors.

The main payment mechanisms

1. Google AdSense
2. Affiliate marketing
3. Brand relations
4. Merchandising
5. Events
6. Other – e.g. publications

1. Google AdSense

Google AdSense is the mechanism that YouTube uses to reward people whose videos are viewed. Money is earned via advertising attached to videos.

The figures can appear mind-boggling if you are not accustomed to dealing in millions, but it’s quite straightforward. CPMs are costs per mille with ‘M’ being a thousand views. The ePCM is the same measure with the caveat that the views need to be effective – hence the ‘e’. YouTubers are only paid when they get someone to watch at least 30 seconds of an ad.

The PCM figure fluctuates, but as a ballpark figure, a thousand views in a month will bring in around 20 dollars. 

Examples of who gets paid by AdSense

Small players are welcome but the bar is set high. The invitation to ‘monetize your videos’ only comes once a member has had 10,000 views. A content creator, such as a grandmother who unboxes dolls and demonstrates the features, has potential value to YouTube.  

Some videos will be more lucrative than others. YouTube’s model allows it to benefit from surprise successes like Play-Doh Sparkle Princess with nearly 600 million views. 

Who gets paid well by AdSense

Gamers – On Forbes’ 2017 list of top-earning YouTubers, four were gamers. DanTDM, a Minecraft player, was placed at number one, with over a billion views contributing to his $16.5 million. 

Musicians – Viewers do not pay to watch music, but a few seconds looking at an ad sends cash in the direction of musicians. YouTube ensures musicians are paid for cover versions too.

Comedians – Dan and Phil create silly comic videos that appeal to teens.  Comedy pioneers Smosh, who split up last year, made $11 million in 2017.

2. Affiliate commission links

Showcasing products allows people to make money via affiliate marketing. The information box below a video can be filled with links for buying products.  A makeup blogger can have links to her lipstick and also to higher ticket items, like the studio light she finds most flattering. This money is coming from the sellers’ websites or Amazon.

3. Merchandising

YouTubers with strong brands and a few thousand engaged followers (who like, comment, and share) can add revenue with merchandising.   Most popular items for sale are t-shirts/clothing, bags, and posters. Dan and Phil create and sell ‘merch’ that is very desirable to their young audience, especially when the pair are touring. Creating and shipping can be outsourced to a company like Zazzle.

4. Events

YouTube builds communities and, like bands, YouTubers can tour. Comedy duo Dan and Phil toured the world acting out their videos in 2016. Gamer DanTDM, the Minecraft man, had a 50-night global tour in 2017 with four sold-out nights in the Sydney Opera House  

5. Brand deals

Brands can pair with video-makers through direct contact or through a company that deals with influencer marketing. Deals vary and the sums involved can range from thousands to hundreds of thousands.  Pairing with brands means the personality can upgrade from merchandising to having their own make-up or clothing line.

6. Other revenue streams – publishing

Authors looking for publishing deals can be perplexed when asked about their ‘platform’ – a word for their following. YouTubers are well aware that their ready-made audience is attractive to publishers. 

Comedian Lilly Singh’s helpful advice charmed a large YouTube audience, and Penguin Books saw the potential for a self-help publication. Singh’s proven skills lent themselves to a self-narrated audiobook and a place on the New York Times Best Sellers list.

YouTube’s policy of paying

YouTube has created opportunities. Career advancement and wealth are available to people willing to make and share their videos. Facebook’s Mark Zuckerberg was recently criticised by media mogul Rupert Murdoch for not paying his publishers for their content. In 2012 Zuckerberg bought Instagram, which has many influencers. It will be interesting to see if one day he will be as generous as YouTube.