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Tips For Creators

June 20, 2022

8

min read

Understanding YouTube sponsorship rates

Have you ever wondered how much money YouTube influencers make? The answer is: It's complicated. From understanding industry standards to wrapping your head around different ways of monetizing content, understanding how much to charge for a YouTube sponsorship can be a minefield. We're going to take a deep dive into the world of YouTube sponsorship rates, and try to eliminate some of the confusion surrounding this issue. 

Standard YouTube Sponsorship Rates

When it comes to sponsorship rates, it’s important to remember that these deals are flexible and depend on multiple factors. These sponsored videos are negotiated on an individual basis, and there’s no one set price that applies across the board. 

The main factors that impact the amount a brand pays for sponsorship include:

  • What type of content do you create? A fashion/beauty vlogger might attract more brands (and demand a higher rate) than a gaming channel.
  • Is this specific type of content rare in the market? If so, sponsorships may be higher than average since brands want to be attached to something unique and exciting
  • How high are your production values? A professionally made stop motion animation would typically cost more than a single camera webcam recording.
  • Are there other factors outside of YouTube influencing the value of your channel? For example, if you have built up a strong reputation on another platform (such as podcasts or Instagram) then that will allow you to ask for higher rates on YouTube, even if your YouTube subscriber count is still in its early stages of growth.

Remember that sponsorship rates on YouTube are usually calculated with a CPV (cost per view). Typical CPVs vary from 1 cent to 10 cents at the higher end. The CPV is then multiplied by the channel's “projected views” to calculate a flat rate for the video. Some brands will also ask for a minimum view guarantee, to make sure the sponsorship deals hits their required CPV, regardless of the performance of the individual video. That means that if the video falls short of the minimum view count agreed in the negotiation, the YouTuber will make an additional video with the ad integration, to make sure the brand receives the views they were expecting from this channel. 

The CPV rate usually doesn't depend on channel size - there are some very large channels that charge a 1 cent CPV, and some smaller, niche channels that have a much higher Cost Per View. However, with larger channels each video generally received more views, so they are able to charge a higher sponsorship rate for each video. 

We all want to know how much money YouTubers make

You're not alone. We all want to know how much money YouTubers make from their content. There is an ongoing perception that influencers are somehow able to rake in money from “doing nothing”. The reality couldn't be further from the truth. YouTubers are responsible for planning their own content, as well as shooting it, handling editing and post production, and looking after the distribution and promotion of each video once it is ready to go live. The effortless looking and authentic sounding videos often disguise a lot of this hard work. Once you understand all of these steps, the money YouTubers make suddenly makes a lot more sense. 

On top of that, in order to work with brands and actually get paid for creating this content, YouTubers have to find companies to work with, pitch their channel, handle the negotiations, understand the brands requirements and make sure they deliver on these in their video integration. Remember that these deals typically involve delivering results in terms of driving sales or increasing awareness about a product—which means additional responsibilities beyond just creating entertaining content! 

Working with an agent can often help with handling brand relationships, but that is not always an option for every YouTuber. Many agents only agree to work with creators with a large subscriber base, so smaller channels are often left to handle these brand relationships independently. That being said, often small YouTubers make quite a lot of money, if they are savvy about brand relationships and strategic about pricing their content. Smaller YouTubers can earn a lot of money by charging a low CPV but churning out frequent videos. 

How much to charge for a YouTube sponsorship

When it comes to YouTube sponsorship rates, it’s important to understand the many factors that determine the value of your channel. Understanding how much you should charge for a sponsorship is essential to building a successful career and growing your audience. You don't want to undervalue yourself and receive less than what your channel is actually worth, but you also don't want to be too expensive and lock out brands that might want to work with you. 

Pricing your channel correctly is often a matter of trial and error. Since you don’t need to publish your rate anywhere publicly, you can play around with different pricing until you settle on the rate that feels right for you. It’s a good idea to stay open to brand negotiations and look at offering multi-video deals for a lower rate. If the rate you are receiving doesn’t seem to be inline with the work you are putting into creating the video, you might want to consider raising the price slightly. 

YouTube Sponsorship rates are based on what brands are prepared to pay

What is the rate for a YouTube sponsorship? Well, it depends not only on the type of channel but also on the type of brand. Are you thinking of being sponsored by a big tech company? Or is your sponsor going to be Joe's Lawnmower Repair Shop out in West Texas? What we mean to say is that the rates of YouTube sponsorships vary greatly and are largely dependent on the buying power of your sponsors. Even brands in the same industry have different budgets to spend on YouTube, so a CPV that might work for one brand might not be possible for another brand. The standard rate is based on what most brands are prepared to pay for different channels. 

Brands will also pay for relevance. If a brand wants to reach a specific audience, then they must make sure that the channels they sponsor align with the same demographic that they are trying to target. For example, if someone was advertising baby products on YouTube then it would make sense for them to only work with channels featuring mothers who were expecting or had recently given birth. This group of channels would be more likely to attract audiences who are interested in such products. 

Other ways to get monetized on YouTube

Beyond sponsorships, creators have a few different options for monetizing their YouTube channels. Two main options that many creators explore are affiliate links and merchandise.

  • Affiliate links let you earn commissions whenever someone makes a purchase through one of your links. For example, if you link to Amazon in the description of a video and someone buys something after clicking the link, you'll receive a commission on that sale. In other words, with affiliate links you get paid when a purchase is made, rather than when you publish new content on your channel. 
  • Creator merch is merchandise that can be purchased from your website or from platforms like Teespring. Creators usually make money when fans buy merchandise because they set up their own shops on these sites where buyers can purchase items with prices based on how much profit will go towards creators (the profits vary depending on what kind of product it is).

The benefits of a YouTube sponsorship calculator

There are tons of tools out there that help you calculate how much you can earn from your videos. A YouTube rate calculator can help to point you in the right direction and find a ballpark figure for your content. Watch out though: many sponsorship calculators overstate the sponsorship rate and suggest video rates that few brands will be prepared to pay. 

After reviewing a lot of other YouTube rate calculators, we decided to create our own. Rather than looking at subscribers (which isn’t a particular strong a factor to determine pricing, especially since brands know how easy it has become to “buy” YouTube subscribers) our YouTube calculator looks at a number of other factors: 

  • The type of content the channel specializes in. As noted above, lifestyle content generally commands a higher rate than gaming content. Each channel category will equate to a slightly different CPV. 
  • Percentage of the audience based in North America. Let’s face it - most of the brands that are the biggest sponsors on YouTube are American companies, and many of them don’t ship outside of North America. That means that brands are reluctant to pay a lot for channels where the majority of their views are from outside this territory
  • Placement of the ad within the video. Pre-roll and mid-roll ads will always be able to charge a higher rate than post-roll ads (ie ads that only appear at the very end of the video.) The reason is simple: brands know that audiences aren’t very likely to stick around to watch the ad if they’ve already finished watching the video in question. 
  • Sponsorship track record. If you are fresh faced new creator that has never worked with a brand before, it will be hard for you to ask for the same rates as a channel that has a tried and true relationship with leading brand sponsors. We look at both how many brands you have worked with and whether those brands were satisfied enough to come back to work with your channel again - a sure sign of success that can help you to boost your sponsorship rate for all future deals. 

Conclusion

YouTube sponsorships are a great way for brands to showcase their products and reach new audiences. If you're looking to get sponsored on YouTube, make sure you have a solid content strategy in place and that your channel is growing steadily before reaching out to potential sponsors. Be sure to check out our calculator so you know exactly what your content is worth - just enter your channel information and we’ll send over an email with a personalized calculation for your YouTube sponsorship rate. 

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