How Exactly Do People Make Money on YouTube?

[Editors Note: This article was written by Hugh McIntyre. Hugh writes about music and the music industry and regularly contributes to Forbes, Sonicbids, and more.]

 

By now, everybody involved in music (and the internet, really) must be aware that there is money to be made on YouTube…but how is that done? How can somebody actually see their bank account inflate (if only by a little bit) based on content they give away for free?

It’s all about the ads! Throwing advertisements onto your upload might not make you rich, but it can earn you some much-needed cash, so here’s a primer on what you need to know and how you can get started when it comes to advertising on the free-for-all that is YouTube.

Make Sure You’re Actually Displaying Ads!

I have heard a number of musicians admit that while the idea of collecting even a few dollars from their YouTube videos is appealing, they don’t even know how to get started. Creating monetary connections with a multibillion dollar company and becoming something of an advertiser can be somewhat daunting, but don’t let it scare you off from inserting ads into your content!

Unless you’ve specifically gone through the process of actually adding advertisements onto your clips, it is highly unlikely that you’re already making money off of them, which means you’re missing out.

The first step is to join YouTube’s “Partner Program,” which essentially means you’re worth advertising with. Don’t be nervous if you’re not accruing millions of plays per video—every video is worth monetising, especially to YouTube. This step should take all of about three minutes.

The next necessary step is creating what Google has termed an “AdSense” account, which is where the money comes in. AdSense has become one of the biggest and most important advertising platforms on the internet over the years, and YouTube knows how to make it work as well as its parent company. This requires you to have some financial info on hand, and it can take a few moments, especially if you don’t have everything necessary right in front of you. Again, it’s not hard, but you’ll need to be approved before you can move forward.

From there, you’ll decide what videos to monetize. I’d suggest at this point in your career throwing ads onto everything you upload, but if you have a piece of content that is truly special and that you feel will be hurt by a something like a car commercial playing before or a banner appearing at the bottom of the screen, feel free to opt out. This is your art and your career, after all.

Different Kinds Of Ads

Okay, so you’ve decided that you can handle a bit of advertising with your music if it will help pad your bank account. Is that all you need to know? Not even close. There is still plenty to learn about advertising, ads, making money, and what will keep people coming back…but I can’t fit everything into a single post.

You may not have realized it while watching videos on YouTube, but the company actually has half a dozen different kinds of ads that can earn you money, depending on the situation. They will all make you different amounts, and you should consider carefully which ones would be most appropriate for which uploads. Here’s a quick rundown looking at what is what (using the company’s terms, because that’s what you’ll want to become familiar with):

Display Ads

These are the visuals that don’t actually cover your video in any way, but which are posted to the right of the screen, which is common for any website these days. Even if you’re not a fan of interrupting your art in any way, you can surely support this, right?

Overlay Ads

These are the banner ads that pop up at the bottom of the video screen that you’ve probably seen a million times. They’re not nearly as intrusive as some other forms, but that also means they won’t net you quite as much money per click.

Skippable Video Ads

This might be the best option for you as a musician when it comes to inserting ads to your videos. These video advertisements play for a few seconds, and then the user has the option to move on or keep watching the sponsored message. This puts the power in the hands of your fans, but it also means you could earn a few dollars if all works out.

Non-Skippable Video Ads

Brands will pay good money for ads that cannot be ignored before the music plays, but that also intrudes on the listening/watching experience. Are your fans willing to stick around through a 30-second ad to see your latest music video? You need to ask yourself this before selecting this option.

Bumper Ads

These are also a potentially perfect option, as they bring in more cash from advertisers because they are video ads that can’t be skipped, but they are only a few seconds long, so most people won’t mind sitting through them. At just six seconds long, these aren’t likely to annoy many, and it’s difficult to imagine hordes of fans moving on from your content because of these short promotional moments.

Sponsored Cards

These aren’t quite as common, but they can actually be helpful in some small way. Sponsored cards aren’t random ads—they typically offer items for sale that a user may have just seen in your video, or which relate in some way. That’s a nice tie-in, and it doesn’t feel quite as corporate.

It’s Not Just Your Videos That Make Money

This article was primarily focused on covering or introducing your music videos with ads, but the above options aren’t the only ways to make money on the world’s largest video hosting site. You should also be monetizing your music, which either already is, or will at some point in the future be used in other people’s clips. You never know when a fan will make a lyric video or post a cover, and while you have the power to take those down, it makes so much more sense to simply throw an ad onto those and collect the cash.

There are a number of services that can track where your music is being used and help you earn from those clips, including TuneCore’s YouTube Sound Recording revenue collection service, which utilizes YouTube’s own ContentID platform.