Running a YouTube channel is probably a very creative and challenging project. But is it rewarding enough to undertake this activity or how much does YouTube pay? There are two sides to this coin. While for a few it is a hobby and labor of love, for others it is a way to make millions. YouTube gives creators an opportunity to showcase their talent. While the possibilities are endless and the creators’ economy is also growing, let us take a walk through how easy or difficult it is to make money on YouTube and what can be done to expand your possibilities of earning from your video creations.
How is YouTube Revenue measured?
YouTube Analytics metrics are used to track your YouTube revenue and your channel’s performance. These metrics are almost similar but it is important to understand the small differences if you want to study YouTube ad Revenues.
Revenue per Mille (RPM) metrics indicates the amount of money you’ve earned on every 1,000 video views. RPM depends upon revenue generators like advertisements, YouTube premium earnings, Channel memberships, Super Chat, and Super Stickers.
Cost per 1,000 impressions (CPM) metrics indicates the amount of money spent by advertisers to show ads on YouTube. YouTube has different CPM metrics in its YouTube Analytics:
- CPM: It is the price that an advertiser spends for each 1,000 ad impressions. Ad impressions are counted at a given time when the ad is shown.
- Playback-based CPM: Playback-based CPM focuses on the cost incurred by advertiser for playing the ad videos on a platform.
What is YouTube Ad Revenue?
A YouTuber needs to understand how revenue is generated on YouTube in order to earn to the highest point. YouTubers primarily earn from advertising revenue. The ads can be run anytime during the videos. They can be skippable, non-skippable, mid-roll ads, ads on the side, or in the form of a banner at the bottom.The quality of ads also decides the number of views of an advertisement and YouTube income per view. An AdSense account needs to be signed up before monetizing your videos and joining the YouTube Partner Program. Let us understand what estimated revenue and ad revenue are.
Estimated revenue vs. ad revenue
- Estimated revenue: This is the total amount of returns received on a creator’s video from all revenue types. The revenue types include channel memberships, YouTube Premium revenue, and Super Chat which are displayed on the Revenue tab.
- Estimated ad revenue: This is the revenue generated from the ads on your videos. This metric is displayed in the revenue sources report.
There will be a gap between the earned views and the projected monetized playbacks/views. This is because all views on YouTube do not have ads. A view may not have an ad when:
- The video is not friendly to the advertisements.
- Ads are turned off for the video.
- No suitable ad for the particular viewers’ of that show; i.e. the viewers may not match the advertiser’s targeting specifications.
Other factors include viewers’ geography and Premium subscription etc.
View-based revenue on YouTube
YouTubers get paid by Google AdSense. AdSense is a very fine artificial intelligence product that can identify spammers who generate fake traffic. It uses advanced methods for generating ads and paying the publishers.
There are number of factors that influence YouTube earnings. YouTube uses a CPM-based formula (cost per 1,000 Impressions) and you get paid for every 1,000 YouTube ad impressions you receive.
Example: If CPM is $1, it means that they pay $1 for every 1000 advertisement impressions. CPM can lie between $0.1 to $10, based on the niche you work with. In 2018, YouTube’s CPM was about an average 3$. Now let us calculate the earnings when CPM is $1:
1,000 views 1.0$
10,000 views 10.0$
100,000 views 100.0$
1,000,000 views 1000.0$
10,000,000 views 10,000.0$
100,000,000 views 100,000.0$
1,000,000,000 views 1,000,000.0$
There are other factors that decide about YouTube video ad revenue. So, understand the video ad strategy and the important five factors that influence ad revenues.
- Duration of video: YouTube suggests that the videos must be 12 seconds long, to be eligible for in-stream ads. But it is seen that longer videos generate more ad revenues.
- Advertisement Blockers: YouTube does not receive ad revenue when a video is watched by a person who has enabled ad blockers.
- Quality of advertisements: Well-produced ads that are relevant and creative generate higher ad revenue.
- A number of views: This means that YouTube uses a pay-per-view pricing that is charged only when viewers watch an ad, yet the number of views a video receives is said to be directly proportional to the ad revenue generated.
- Clicks received on ads: YouTube uses another model where the fee is based on the number of times the ad is clicked whether the viewer watches the ad or not. More the clicks, the more revenue.
Does YouTube Charge from Creators?
- YouTubers will receive 55% of what is received by AdSense from monetizing the views. So, YouTubers do not pay anything to YouTube besides taxes, but they get to earn 55% of their earnings and YouTube keeps 45% for itself.
- On YouTube, a creator who is a member of the YouTube Partner Program earn between $0.24-$4 per 1000 views. So, a good content artist may be able to earn between $240k to $5 million for 1 billion YouTube views after YouTube’s cut.
YouTube Payment Cycles
The AdSense pays the YouTubers in monthly cycles.
- The Electronic Fund Transfer takes place on the 3rd of the month for the previous month’s transactions.
- For any changes to payment, information needs to be completed before the 20th or else it will reflect in the next payment cycle.
- If the total balance does not reach the payment threshold by 20th, payment will be rolled for next month. If in case the balance exceeds their payment threshold, you receive this payment between the 21st and the 26th of that month
Is being a YouTuber Profitable enough?
Let us ponder over the fact of whether it is profitable to be a YouTuber. The answer is, YouTube can be a great source of income for you but you have to play your cards right. There are many videos by YouTubers revealing how much money they earn from AdSense and YouTube deals. Some reveal that it is difficult to make ends meet, pay the bills and rent etc.
It is very difficult to achieve millions of views every month. Some videos monetize better and others do not. This may depend upon the niches. Ad income is not good if you do not have tons of views. YouTube keeps a cut from the total monetized money cutting down on the revenues of the creators.
Taking all the concerns into account, content creators these days are opting for premium YouTube alternatives. And, GUDSHO is a pioneer in resolving these challenges in style.
GUDSHO, a lucrative video monetization platform is designed exclusively for video creators, YouTubers, independent storytellers, or business owners to create, launch and monetize a video business in quick steps. It’s a one-stop hub where creators meet audiences who love to interact and pay for the content they have at hand.
After all this brainstorming, we now know that not all views on YouTube convert into income. Uploading videos are easy on YouTube but earning money is difficult. Gaining an audience and views is a difficult task on YouTube as millions of videos are uploaded daily on YouTube. A shortage of views affects monetization and earnings. Do not undermine the capabilities of YouTube alternatives. Some newer VOD platforms even offer 100% earnings on sales. So, explore and experiment well before you make your decision.