Making money on YouTube has become a full-blown industry. It has over two billion users (which YouTube claims is almost one-third of the internet), and an estimated 500 hours of content uploaded every minute!
Professional YouTubers can earn some serious income, from ads, sponsorships, and more. YouTube creator revenue ranges from hundreds of dollars to hundreds of thousands of dollars, depending on subscriber numbers, video views, and monetization tactics. In fact, Forbes estimates that top talent can make about $5 in just ads for every 1,000 video views. That’s a pretty significant side hustle.
But what are the keys to making money on YouTube? Put simply, the more subscribers you have, the more you can make.
When I started my YouTube channel in 2011, I knew nothing and made every mistake in the book. Fortunately, I figured out how to make money on YouTube, and have steadily grown my followers.
Put simply, the more YouTube subscribers you have, the more money you can make.
My YouTube channel growth was uneven. By the end of 2016, and after more than five years with the channel, I just had 9,500 subscribers. But the numbers began to take off from there and looked like this:
- 2017, added 48,427 subscribers, an increase of more than 600% for the year.
- 2018, added 158,114 subscribers, an increase of more than 370% for the year.
- 2019, added 70,075 subscribers, an increase of nearly 27%.
- 2020, I added 51,253 subscribers year to date, for an increase of more than 25% in less than six months.
Since then, I’ve learned a lot about what it takes to earn a living on YouTube. I wrote this guide to share everything I learned with you to speed your path on your new YouTube venture.
What You Should Know Before Getting Started
Initially, Don’t Worry About Making Money
Although this might sound like the worst business advice possible, when you’re starting with YouTube, you can’t focus on just making money. Instead, pay attention to your subscribers, views, and video retention. Respond to comments and building rapport with your viewers. Don’t expect to make any real money until after you’ve hit 1,000 subscribers, which can take anywhere from a month up to a couple of years, depending on your efforts and strategy.
You May Need a Thicker Skin
As with any endeavor where you make yourself vulnerable to the world, be prepared to receive some less-than-pleasant comments and responses. Unfortunately, internet trolls come with the territory. If you’re serious about building your channel into something significant and profitable, take care to differentiate between the constructive feedback that you should pay attention to and the comments just meant to rile you up.
YouTube is a Commitment
You have to love creating content to do this successfully. And if you’re investing money into cameras and other high-tech gear, it’ll probably take you a long time to actually make any profit at all. Take time to figure out your personal recording style and be aware that creating good video content takes time and effort.
How Much Money Can You Make on YouTube?
This is probably the single most common question asked about YouTube. Unfortunately, there’s no simple answer. There are a few rules of thumb floating around but they’re not conclusive. A report published on Intuit Turbo in January estimated $3 to $5 per one thousand video views, but there are a bunch of variables in that range.
The biggest variable is the number of views. The more viewers you get, the higher the revenue is per thousand viewers. Suffice it to say the overwhelming majority of YouTubers don’t make any money at all. But the top players earn well into the millions.
Two successful YouTubers I know who’ve hit YouTube gold are Nate O’Brien and Graham Stephan. Both are easily making six figures per year from their YouTube channels. Nate’s running between $25,000 and $30,000 per month, and Graham might be close to joining the $1 million club. Both are in the personal finance space.
My own results have been more modest, but then my YouTube channel is only one of several income streams I have.
But here’s my own personal breakdown:
From February 2019 through February 2020 my YouTube channel generated $55,970.31 in revenue. That works out to be about $4,664 per month. And it varies quite a bit from one month to the next. For example, in January I earned $3,839.
That doesn’t come close to what others are doing on YouTube, but it’s a more than respectable side hustle income.
If you’re ready to take the leap and start your own YouTube channel, read through the steps I’ve outlined below. Remember, it’ll take some time, but a good YouTube strategy can pay off in the long run.
Step 1: Choose Your Channel Style and Name It
If you’ve spent any time on YouTube, you know how many types of channels there are. From home decor to personal vlogs, to educational and how-to channels — there are a lot of buckets. The bottom line is, your channel style should suit whatever it is that you’ll create.
If you want to share more personal elements of your life, a family or personal vlog might be the way to go. If you have a specific skill set you’d like to highlight or share, perhaps an educational channel is a better bet for your viewers to get the most out of your content. Edutainment channels offer a little bit of both — entertainment (often a personal element) mixed with education. This is what I try to do with most content on my channel, and is common among personal finance content creators.
Although naming your channel is important, don’t stress out about it too much at the beginning. You can leave your personal name as a channel name, but always change the header graphic to represent whatever your channel is all about.
Eventually, as you fine-tune your style, you’ll want to have a name that’s memorable and strongly represents what your brand is about. You have to meet several requirements to have a custom URL. Once you meet those requirements, it’s good to change your channel name so that its URL is easily shareable.
Step 2: Decide on Your Publishing Schedule
The truth is, it really doesn’t matter how much or how often you publish. The key is being consistent with whatever schedule you set so your audience knows what to expect. A YouTube consultant that I hired had me think of my channel as a TV show, so my audience knew when to expect the next video to go live — then they could plan for it and get excited.
This also helps potential advertisers understand what they’re working with as far as content scheduling. Although there are several channels that publish daily content, be careful of burn out. Many creators fall into the trap of feeling like they have to publish consistent, quality content on a regular basis, and it’s not always feasible.
Step 3: Pick the Gear You Need
You don’t need the latest and greatest camera to produce good-quality content. What you do need, however, is good lighting and solid audio. No one wants to watch a video that they can’t hear.
That said, with more and more creators starting channels, you also want to find a way to stand out. Recording in 4K isn’t required by any stretch, but it’s something that I’ve been doing lately as a way of future-proofing my channel in case YouTube gives preference to higher-quality videos.
Here’s a list of equipment to consider:
- iPhone — record it in 4k, if possible, to future-proof yourself
- Canon EOS R for vlogging
- Panasonic Lumix GH5 for desktop recording
- Canon RF 15-35mm f/2.8 for vlogging
- Sigma 16mm f/1.6 for desktop
- Vlogging Mic — Rode VideoMic NTG
- Desktop Mic — Rode NTG3B Shotgun Mic
- Microphone Adapter/Mixer — Beachtek DXA-Micro-PRO
- Main Light — Neewer 200Ws Dimmable LED Video Light
- Secondary Light — Neewer LED Bi-Color Studio Round Lighting, Ultra Thin Studio Edge Flapjack Light
- HDMI to USB Converter — CamLink 4k (currently sold out everywhere)
- Alternative option — Magewell USB Capture HDMI Plus
- Editing Software — iMovie and Screenflow
Step 4: Hit Publish
Optimize Your Videos
Start by creating an enticing title. You’ll have to do some experimenting here, based on your topic niche. But action-based titles tend to work the best. Something like “5 Easy Steps to Wipe Out Your Credit Card Debt” gets right to the point and tends to draw viewers with a lot of credit card debt.
You also need to add relevant tags to each video. That should start with writing a short description of what your video is about. It should hit the main points, particularly the ones that are likely to appeal to your target audience. If you’re unsure about this, check the descriptions under successful competing videos. Your description should include keywords that describe the main points you’re making in your video.
Promote, Promote, Promote!
I don’t care how many YouTube videos you watch or much you spend on a camera and lighting, the first video that you publish will be horrible. The fact that you actually put that on the internet for anybody to see is something that you’ll be embarrassed about three years from now. Even worse, it doesn’t get better with your second, third, fourth, or fifth video. There might be slight improvements, but looking back on those videos, you’ll definitely cringe a bit.
Everybody’s learning curve is different, but I still see ways that I can improve my videos, and I’ve been on YouTube since 2011. It takes about 50 to 100 videos to finally find your groove, in my opinion. Sharing your videos with your close contacts and on social media is the easiest way to get constructive feedback. You can’t improve if you don’t know what’s wrong. Even though you might be embarrassed by what you’ve published, promote it as much as possible and learn as much as possible.
Another effective promotion strategy is cross-promotion with other YouTubers or even bloggers. If you can get a few of them to link your video in their videos or blog posts, they’ll send you some additional traffic and improve your visibility on YouTube.
Don’t get discouraged during this phase. As I’ve already mentioned a few times, it takes time to make money with YouTube. Keep publishing consistently, keep improving, and keep focusing on the big picture.
Step 5: Make Money
The easiest way to make money is with Google Ads or Adsense. This is a popular income source with blogging and on YouTube, especially for newer channels. A big advantage of Adsense is that it’s a completely passive way to earn income. Once you add it to your videos, ads will pop up that are relevant to the video content, and you’ll earn a small amount of revenue each time an ad is clicked. Generally, that’ll be no more than a few cents per click.
How many clicks you’ll get depends on how engaging your video is, and how much it motivates viewers to click through to the ads.
Adsense is easy to set up, and afterward, it requires no extra effort on your part. Like YouTube, Adsense is a part of the Google family and a natural fit.
The disadvantage with Adsense is the obvious limitation that you’ll only make as much as the views that your video generates. But the ads can also be distracting to your viewers, especially if you’re trying to earn money from your videos using other sources.
Adsense is a good choice for a beginning YouTuber. But as your channel grows, and your video views become more predictable, you’ll want to move on to other sources.
Be aware that YouTube recently updated their requirements to qualify for its ads program.
Much like a blog, you can create product reviews as YouTube videos. Thousands of companies pay affiliate commissions to YouTubers (and bloggers) for these reviews.
For example, let’s say you created a video reviewing a specific product. A link will be included for viewers to click through if they’re interested in the product. If they make a purchase, you’ll get paid a referral fee.
You can often work directly with affiliates, especially if you have a large YouTube following. But many are also available through affiliate marketing sites, like CJ Affiliate or ClickBank. You’ll need to submit an application with any affiliates on either site that you want to review, and your acceptance is subject to approval.
If you go with affiliate marketing, you’ll need to check the “video contains a promotion” box on your video manager to let YouTube know it’s a paid endorsement.
For many YouTubers, affiliate marketing is their bread-and-butter. This is especially true if they have a special niche where they’ve achieved expert status. That status translates into more ad click-throughs and more paid sales.
Direct Sales to Your Viewers
If you have a product or service to sell, or a line of either, YouTube is an excellent sales channel. You’ll create informative videos, and viewers can order directly through a link that appears in the video.
This is probably a more advanced YouTube monetization method. You’ll not only need a viable product or service, but you must also be completely credible in presenting it. That’ll require being an expert on the subject, including what your competition is offering. You’ll need to present a compelling reason why your product fills your viewer’s needs.
Put another way, you need to be a really good salesperson. More than anything else, YouTube is a platform where you can automate your sales pitch. Instead of making the pitch to one person or a small group, YouTube lets you reach thousands of people in a matter of days.
You can probably imagine how that multiplies your sales!
Brand Sponsorship Deals
For me, the big revenue generator on YouTube has been brand sponsorship deals. The best paying one I did earned between $20,000 and $25,000.
Brands want to partner with experts and influencers in just about every capacity. In my case, that was personal finance. I’ve been able to position myself as an expert through my blog, but also through YouTube. Those channels can bring brands to you.
Brand sponsorship deals tend to be very specific and require more effort than standard YouTube videos. They might require you to present their product or service in a blog post, or even on their website, in addition to a YouTube video.
When you get one, it’s usually for a flat fee that’s paid in installments. And of course, your YouTube presentation is reviewed and approved by the sponsor. I get several of these offers per year, which gives me the luxury of being able to choose the ones I want to work with.
I have to warn that brand deals aren’t something that can work for a novice YouTuber. The brand is paying you to sponsor their product based on the popularity of your channel. It’s one of the best ways to make money on YouTube, but it’ll need to wait until you have a bigger following.
Final Thoughts on How to Make Money on YouTube
Once you get a money-making YouTube channel up and running, you have to keep going. That means churning out high-quality content on a regular basis. The people who are making serious money on YouTube are doing that all the time.
Because of my other income-generating ventures, I haven’t been ready to make that commitment on an ongoing basis. But I still believe YouTube is an excellent way to build a steady income stream — one that works even faster than my main blogging gig.
And for me, YouTube has never been primarily about income. Yes, I’m happy to be in the game and earning money. But it’s more about the challenge — I want to master the YouTube algorithm because it has incredible potential.
But if your goal is mainly to make money, you’ll need to treat your YouTube channel like the business it is.