DURBAN - YouTube is a great way for people to make money and it has also resulted in many people becoming famous like Lilly Singh.
There are three ways that people can make money on YouTube:
1. CPMs from the advertisements
2. Product Placement
3. Sponsored Videos.
The cost to the advertiser for 1000 views of an advertisement is known as the CPM. According to SocialBlade Analytics, the range varies from $0,60 (R7,026) to $7,00 (R84,07).
Not all views are created equally, lots of factors contribute to the variation.
The factors include:
1. Quality of traffic (age and gender if the viewers)
2. The source of the views by country
3. The type of video
4. The type of ads
5. The price if the ads
6. The actual click rate
7. How frequently videos are uploaded
8. Audience engagement
9. The number of subscribers
10.The percentage fo views on mobile
Assuming that the average CPM is about $3-$4 (R36,03-R48,04) YouTube takes a 45% cut and sometimes a Youtuber has a Multi-Channel Network (MCNs) representation who also get about 45%. This means that the YouTuber, in the end, will make $1 per CPM of $1000 (R12010) per 1 million views.
However, ads on views are not the only option for popular YouTubers to make money. Lots of YouTubers make money from selling products like merchandise, apps, books, music, affiliate promotions and brand deals.
Branded deals or integrations also known as product placements or sponsored videos can also be profitable.
Unlike advertising, the money made through product placement and product sponsorships, for the most part, doesn't have to be shared with YouTube, but many do split with the MCN that represents them.
Today most brand dollars go to the top 1% due to them being large enough to have their business managers or agents bringing in the deals.
Gabby Dunne, runs a popular comedy channel called Just Between Us. Many of Dunne's videos break a million views. She makes money on the ads that play before videos and brand deals.
According to Dunne when you are getting more than 1 million views fans tend to think that you are "too big for donations. Dunne wrote that her biggest brand deals were $6000 (R72060) and 30% went to her MCN.
- BUSINESS REPORT ONLINE