If you are reading this, you are either a brand looking to negotiate with a YouTube creator about a potential partnership, or a YouTuber hoping to reach out to brands for a possible collaboration - whatever the case, you’ve come to the right place. However, let’s put things on the table - there aren’t cookie-cutter rates. Just because you have a certain number of subscribers and reach a certain number of views, doesn’t mean the creator or brand can ask for a specific rate. There’s a lot more to it.
YouTube sponsorships can be a lucrative revenue stream for YouTubers and an ideal way for brands to gain exposure and engagement with their products/services. However, in order for the partnership to succeed - both sides need to agree on the rates, which depends on a few aspects. These include (but are not limited to) the following:
Subscribers: Viewers who have chosen to “follow” a specific YouTube channel. These users can be considered loyal followers of the channel as they receive notifications whenever a new video is uploaded.
Average views: The amount of views a video will receive is completely out of a publisher's control. So, instead of basing a channel’s value on the amount of views the most recent video received, creators and brands should focus on the average number of views - So, total views divided by number of videos.
Category: The type of content the channel focuses on, for example - lifestyle, sports, gaming, how-to, etc.
Placement of the ad: Where the advertisement is placed in the video (beginning, middle, or end)
Country: While it's always interesting to know where the publisher is based, the country-factor actually focuses on where the majority of their audience is located.
Seems pretty straightforward, but how do you calculate average views? How exactly does the channel’s category affect its price? Do different ads on the same channel cost different amounts depending where in the video they appear? These are some of the questions we had when we started to work with creators. Our media team has worked with thousands of creators across YouTube and set them up for success with brand sponsorships - everything from aligning their rate expectations to reaching out to potential brands.
When beginning to work with a YouTuber, we ask them two basic questions:
Unfortunately, more often than not, creators share with us rates that only hold them back, and prevent them from establishing long-term relationships with premium brand partners. And how did they reach these numbers? Thanks to a compilation of sponsorship calculators available online.
We don’t want to throw shade: these sponsorship calculators are often a great starting point! Creators are asked to fill in the number of subscribers, average views, top audience country, and category - they tend to leave out important factors that truly highlight the true potential of a channel and brand partnership. This ultimately led YouTubers to struggle with negotiating potential partnerships and landing inconsistent deals.
“One of the most encouraging results of the calculator was the ability to show creators the “journey” their channel can go through if they work correctly” - ThoughtLeaders’ Head of Publisher Relations, Amit Altman
Using the experience we’ve accumulated from facilitating thousands of sponsorships, we’ve put together a calculator that relies on much more than just the basics. Our calculator factors in:
YouTubers are well-versed with ‘average views’, but we’ve taken it one step further and opted to look at ‘projected views’. Our algorithm’s goal is to determine how many views the next video on that channel will receive within its first 90 days. The algorithm factors in recent videos released by the channel and gives you an accurate representation of how a video on that channel will perform if you booked a sponsorship with them today. The algorithm offers a conservative estimate which favors advertisers so it analyzes the expected reach of any channels you are interested in booking.
By plugging in the channel’s URL, its projected views will be automatically calculated and included in the computation.
Type of content the channel focuses on; It is crucial to take this into consideration when negotiating partnerships because it clearly highlights the audience profile, brand profile, and brand variety.
The YouTube category has two major factors in the sponsorship calculation:
This is where things get interesting. Our data allows us to see how experienced the channel is in regard to sponsorships - the more deals they have under their belt, the stronger their chances are to reach the brand's ROI.
Using the ThoughtLeaders platform, you can easily check what brands have sponsored specific channels during a specified time period.
For example, if you take a look at Adam Ragusea’s channel over the last 12 months, he was sponsored by 47 brands.
The brand and creator renewed their contract, signing on a new deal; This is probably the clearest indication of a creator’s ability to reach the brand's ROI.
Using the ThoughtLeaders platform, you can easily check how many times a specific brand sponsored the same channel (as well as if the brand decided to only do a one-time partnership). It is also possible to see whether the brand regularly opts for one-time partnerships or usually continues sponsoring the same channels.
For example, let’s take a closer look at Squarespace’s sponsorship roster from 2019-present. Over the last three years, Squarespace has sponsored over 1,900 YouTubers. It’s also clear to see that most of this brand’s sponsorships weren’t one-time deals. Squarespace partnered up with Linus Tech Tips 63 times, as well as with Adam Ragusea 4 times.
Whether you are based in the United States or Australia, the deciding factor is how much of the channel’s audience is based in North America. This can be used as a key negotiating factor.
Ad placement (pre, mid, post); Sponsorship rates may differ depending on the sponsorship placement. Keep in mind - the average retention rate on YouTube is about 50%, so sponsorships appearing post-roll should be priced accordingly.
If you’d like more information about the different kinds of sponsorship placements, we have a full breakdown that includes pros & cons, as well as, examples.
It’s important to note that the ThoughtLeaders sponsorship calculator factors in all these aspects in order to make sure both sides benefit from the partnership - ensuring the creator receives a fair rate for their work while also making sure they’re able to offer the potential brand return on their investment (increasing the chances of renewal and future partnerships). Give it a try!
Why do we not factor in subscriber count? Do the number of likes a channel receives influence its success rates? Here are a few factors our calculator does not take into account and the reasoning behind it.
From creators mentioning “don’t forget to subscribe” to a publisher’s subscriber count clearly emphasized under the channel name, it might come as a surprise that our calculator completely disregards the number of subscribers a channel has.
We have come to the conclusion that not only is the number of subscribers not important when deciding on a sponsorship rate, but it actually doesn’t show an accurate representation of a channel’s CPV. We ran the numbers and noticed that the large channels (creators that have over a million subscribers) actually had 40% lower CPV’s on average.
Video likes strongly affect the YouTube algorithm by influencing which videos will be highlighted. So, the more likes a video gets, the more likely it will appear in relevant YouTube searches. However, when it comes to sponsorship rates, the number of likes a video receives is less relevant.
Our Head of Publisher Relations shared an example of a publisher’s experience with the sponsorship calculator:
“I’ll share the story of a tech channel we started working with about 6 months ago. When we first started working together, they had yet to do a sponsorship. However, they had great views and audience demographics but were hesitant on risking it with sponsorships. As a channel with zero brand experience, they started off 6 months ago with a rate of $900. Today, with the help of our sponsorship calculator, they’ve already been sponsored over ten times and had more than one brand that opted to renew with them. They’re charging around $2,000 for a brand sponsorship and are booked a month ahead”.
While there are a few great online calculators that can help creators understand their value and help brands dip their toes into sponsorships, many of them are missing key factors. Don’t get us wrong, we still strongly believe that there aren’t cookie-cutter rates (that is also why we offer a range based on low CPV, high CPV, low rates, and high rates). Every channel has a unique aspect - whether it explanation videos via animation or taste-testing space food - and its important for the creator to know their value and sell this value to potential brands. However, in order to succeed with sponsorships, its important for both the YouTuber and brand to negotiate with realistic numbers.