Why You’re Not Making Money on YouTube
Many of us are at least somewhat familiar with big-time YouTubers like Lilly Singh, PewDiePie, Philip DeFranco, Casey Neistat, iJustine, and Logan and Jake Paul. Some of us see that their videos consistently get over a million views each. We see that they have millions of enthusiastic subscribers and they’ve definitely achieved some level of “Internet celebrity status” among certain circles. Some of us may aspire to be like them, earning what we think is a glamorous living by “simply” posting videos on YouTube.
But that’s only part of the picture and it’s a very small part of the picture.
Let’s put all of that into a little bit of perspective. Just like with any other business venture, you’re going to have your winners and you’re going to have your losers. You’re going to have tons of people on YouTube who have no ambitions to make any money from their videos at all. You’re also going to have a lot of people who want to make it big, but they give up way too soon when they don’t see the positive numbers rolling in right away. But you’re not either one of those categories, right? You’re special.
Okay, let’s say that you stick with your YouTube content strategy, consistently putting out quality videos on a regular and predictable schedule. You’ve got great storytelling, high production value, and an increasingly large audience. People actually like what you’re putting out there and, with a little luck on your stride, you start seeing those numbers. Your videos are getting hundreds, thousands, or even tens of thousands of views.
That’s great, except the amount of money that you make from direct YouTube monetization isn’t exactly a lot. By most estimates, and this is going to vary widely by niche and other factors, you can expect to get a typical eCPM of somewhere around $1 to $2. That means that when you finally have a video that hits 100,000 views — which is no small achievement — you likely will have earned $200 at best.
For a lot of middle class people, that’s only about a typical day’s pay. Maybe a little more, maybe a little less. Let’s say you have two videos a week and both of them hit 100,000 views. That means you’ve only earned $400 that week. You also have to realize that until you’ve hit it pretty big, you can’t rely on getting over 100,000 views on a video. Even if you get that lucky, $400 a week barely cracks $20,000 a year. That’s nowhere near the median household income in most major cities.
Here’s a little piece of information that will give you a real kick in the pants. It’s estimated that even if your YouTube videos bring in $100,000 in gross revenue in a year, your effective take-home earnings will only be about $21,000 after you account for YouTube’s cut, taxes, and editing costs. This is based on one example with one YouTuber, but it’s hardly far from the truth for many creators at that level.
Sure, there are some YouTube channels that reportedly make over $1 million a year, but we have to understand that they are the exception rather than the rule. The overwhelming majority of YouTubers are never going to get anywhere near that and you’re almost lucky if you break three figures a month before factoring in expenses and taxes. It’s not easy.
Does that mean you should give up on YouTube entirely? Not at all. YouTube is still a remarkably powerful tool that grants you access to one of the largest (and most engaged) audiences on the Internet today. You just have to learn that you can’t rely solely on AdSense monetization if you want to make any real money from it.
That’s why you’re not making money on YouTube. Take John as a prime example. If you take a look at the subscriber and view counts on his channel, you’ll find that these numbers are generally pretty modest. He might get a few hundred views per video with a handful that crack into four figures. Considering the kind of scale that he works at these days, why would he bother? If we were to consider a typical CPM, that means he’s likely only making a buck or two per video on average, right?
For him, the Adsense earnings are (in his own words) just lunch money. They’re the cherry on top. The real earnings come from affiliate marketing. He leverages his YouTube channel as a marketing channel to promote certain programs and what he has found is that a good number of his leads are indeed coming by way of YouTube. And each of these leads can be worth thousands of dollars. That’s much better than a buck or two.
Just because you’re working within the box of YouTube doesn’t mean you’re stuck solely within that box. Consider all the other monetization opportunities that you can connect to your videos. Do you have Amazon affiliate links in your video description? Have you looked into Patreon subscriptions? Are your videos being used as a marketing tool to sell your other products and services? What more can you do to bring in more money outside of YouTube?