The 23-year-old Jimmy Donaldson, better known as MrBeast, a YouTuber from the USA, earned $54 million through YouTube sponsorships in 2021.
Jake Paul was a close second, earning about $45 million by marketing his boxing career. These stats are enough to shut down the skeptics who still believe it isn’t possible to make money through YouTube.
If you’re looking for an exact answer to how much YouTube sponsorship pays, the answer is: It’s complicated!
YouTube sponsorship rates depend on what the brands are willing to pay and the exact reach of each content creator.
What is a YouTube Sponsorship?
Brands commit money or resources to content creators in exchange for promotional benefits. Paying influencers and content creators to showcase a brand in their videos and promote it to large audiences is always profitable.
Usually, the creator earns a percentage of each sale generated through their content. Some portion of the amount might depend on the number of views of that particular video.
Gaming companies, Tech giants, toy companies, food manufacturers, and makeup and skincare companies make up some of the highest-paying YouTube sponsors in the USA.
The content creators might be asked to use a device, play a game, display a product or describe its features in detail.
The contract details vary between companies.
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Types of YouTube Sponsorships
As a YouTube content creator, you have two ways to sign sponsorships:
YouTube Partnership
YouTube offers a Partner Program to its content creators. Their requirements are simple. You must reside in a partnership-eligible country, you need a Google AdSense account, and your videos must be original and not infringe copyright material.
YouTube sponsor platforms are the places where creators and companies connect.
YouTube BrandConnect is one such platform. Currently available only in the USA, UK, and Canada, it welcomes content creators with at least 1000 subscribers and a minimum of 4000 hours of watch time.
Here, the content creators can partner with brands while staying within the YouTube platform.
On Grapevine Village, creators with 10k subscribers on YouTube can look for branding opportunities, make deals, and receive payments.
Outside Sponsorship
YouTube creators with massive followings (visitors and subscribers) are often reached by brands and companies to sponsor their labels and products.
Although it isn’t always necessary to have a huge following to get an outside sponsorship, sometimes your small number of followers might be what a brand wants as its targeted audience.
They might send you a product for review, a free piece of equipment, or a clothing article to promote their product.
The gigs could be paid, or you could be asked to add an affiliate link under your videos and earn a commission out of each sale.
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How do YouTube Sponsorships Work?
If you ask aspiring YouTubers about their YouTube earnings, they’ll probably answer, “nothing” or “not much.”
However, a large number of YouTubers in the USA are making a comfortable income off of their YouTube channels. Among those, a select few rake in dollars with every video they post.
Success breeding success is the formula for earning a fat income check from YouTube. Earning the first dollar is the toughest nut to crack. From there on, it all depends on the number of your subscribers.
All content creators have their fanbase, known as subscribers. This subscriber-based business model has made YouTube a profitable revenue-churning platform.
YouTube Sponsorships Rates
There is no ‘rate book’ when it comes to YouTube sponsorships. Companies and creators agree to an amount depending upon various factors.
The rate per video might differ according to the time spent promoting each product of the same brand. Here are a few factors influencing the sponsorship rates:
- The niche (the type of content, e.g., pranks, kid product reviews, beauty blogging, gaming channels)
- Number of subscribers
- The uniqueness of your content
- Content quality and graphics
- Ad placement (beginning, middle, or end of the video)
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What is CPV?
CPV or cost per view ranges between 1 to 10 cents. A sponsored video’s flat rate can be calculated by multiplying the decided CPV by the “projected views” of the channel posting it. (Projected views are the conservative estimated views, representing how well a video will perform in the first three months of uploading.)
Some brands ask for a minimum view guarantee to ensure that each sponsored video hits the required CPV.
So even if the video cannot generate the targeted number of sales, the content creator will have to make another video, integrating that brand or product to reach the expected number of views.
The CPV rate does not depend on the channel’s strength (no. of subscribers). Some channels with a considerable following have a rate of 1 cent CPV, while some small, not-so-famous channels might charge a greater CPV.
Lage channels usually have an extensive reach and can guarantee more views, so they can easily charge higher sponsorship rates per video.
What is CPM?
CPM, or cost per mile, measures advertisements’ costs. CPM refers to the income or amount paid to the content creator for every 1000 views of the advertisement displayed against their video.
YouTube content creators use this formula for calculating the CPM for each video:
CPM = (production cost of the video advertisement / total views or impressions) x 1000
Here, ‘production cost of the video advertisement’ means the total cost required by the advertisement or the price of the said advertisement.
Total views or impressions are the number of views generated by that video.
The CPM rate varies between companies and brands, even from campaign to campaign. But the higher the views generated by an advert, the higher CPM can be agreed upon, earning you more money!
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Breakdown of Sponsorship Rates
Google keeps 32% of the AdSense revenue, so for each $100 paid by the advertiser, the content creator gets $68.
The per-view rate of a regular advert varies between $0.10 to $0.30, but on average, the advertiser pays $0.18 per view.
If a YouTube channel receives $18 per 1000 views, the content creator will get $3 – $5 per every 1000 views.
On average, if 20% of viewers watch the compulsory 30-seconds of a video ad, converting it to payment, for every 1,000 views, 200 people will watch it.
If the advertiser is paying $0.18 per view, Google will charge the advertiser $36, keep 32% ($11.52) themselves and pay $24.48 per 1,000 views to the content creator.
As mentioned earlier, YouTube sponsorships work on the success breeds success formula; the more subscribers a channel has, the more views it can generate, leading to high income.
As a content creator who wants to earn through YouTube sponsorships, you must keep uploading new videos weekly.
If you have a channel with a hundred thousand subscribers who watch two of your new videos each week, they will make 1,000 x $18 x 2 = $36,000 per week!
How Do YouTubers Make Money?
Many believe that YouTube content creators do nothing, yet they earn crazy amounts of money. This perception is wrong on multiple levels.
Behind every successful channel and content, there’s an insane amount of writing, acting, directing, shooting, editing, and promoting. It takes careful planning to create content that the subscribers will like.
If there’s product placement involved, the YouTuber has to strategically adjust it in the video, plan the video around it, highlight its benefits, and refer to the brand once or as many times as pre-planned with the company/brand.
Additionally, sponsorships aren’t readily available. With too much market saturation, content creators must find brands and companies willing to work with them, pitch their content and channel, negotiate the terms, come to an agreement benefiting both parties, and deliver the content accordingly.
They’re usually in charge of driving sales and promoting products, so it’s not just entertainment; they have to find creative ways to keep the company and themselves in the limelight.
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What Factors Should be Considered During Sponsorships?
Having a large number of subscribers doesn’t automatically guarantee sponsorships. Sponsoring companies and brands look for many factors before signing a contract with content creators. A few of these factors are:
1. Legalities
YouTube strictly prohibits copyright infringement. The sponsors do not consider content creators who use copyrighted music, videos, images, or other stuff.
Sooner or later, these content creators get a notice from Google for going against its policies.
2. Violence
Violent content is a big no-no for sponsors. If your channel and videos show horrific images and videos of harassment, abuse, hate speech, self-harm, suicide, and cyberbullying, chances are that sponsors will not reach out to you and reject your offer to promote their products.
3. Subscriber Strength
Subscribers play a significant role in ranking the channel in terms of views. That’s the first thing sponsors notice; the more traffic your content can generate, the more happily sponsors will consider you for promoting their products or services.
4. Viewer Strength
The number of subscribers does not sway some sponsors. For them, the number of views generated by your videos is a more significant indication of how well your videos perform and how much profit they can possibly generate through their sponsorship with you.
For this, they’ll check the recent 10 to 15 videos and get an idea about your active subscribers.
5. Average Watch Time
This is another measurement indicator of how engaging your video content is. If it can capture the viewer’s attention for a long time, making them watch the videos till the end, it will benefit you in your sponsorship deal.
A longer watch time guarantees that your subscribers like your content, making the sponsors like you!
Read How Much to Earn Money from YouTube?
How Can you Attract Sponsors?
Scoring sponsors takes creativity, negotiation, and hard work. Here’s how you can attract sponsors to your channel:
Make Contacts
Reach out to the media agencies and give them proposals of how your reach and content can help them elevate a brand’s sales. Back up your claims with the record of successful campaigns you’ve already run. Be prepared to tell them how you can solve their advertising issues and improve their market penetration.
Work on your Quality
Remember when we said success breeds success? Focus on improving your content. Think out-of-the-box and give the audience something that’ll hook them.
Research what kind of content gains more traction, then give it your spin. Also, remember not everyone can work on every niche. Play to your strength.
Once you have achieved a substantial following and views, the brands and sponsors will come to you.
You won’t have to go and ask for work; your quality will speak for itself and be visible in the kind of adverts and sponsorship offers you receive.
Read How to Earn Money from YouTube
Frequently Asked Questions (FAQs)
Multiple factors, including the niche, number of subscribers and views, active engagement, and content quality, influence the sponsorship rates.
An average YouTube channel has the potential to earn $15 to $18 per 1,000 advertisement views. When pricing the channel, the content creator has to ensure that their asking price is fair to them and the sponsors.
Charge too less, and you’ll undermine your channel. Charge too much, and you might not get enough sponsorships.
If your video manages 20,000 views daily, your projected annual earnings can lie between $10,403 and $17,338.
No, skipped ads are not considered in payment calculations. Only those ads achieve the payable status that people end up watching.
The more people skip the advert at the start of your video, the more loss you’ll face in your income. It is up to the sponsors to make engaging ads that capture people’s attention long enough not to skip watching them.
Yes and no. Likes and views are not a direct source of income for YouTubers. Even if a video receives a million likes, it doesn’t pay anything to the creator. However, the more likes and comments on video content, the more people will get to view that. That means more people will watch the advert, leading to better sponsorship deals for the content creator.
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I am Steven Martinez, an online entrepreneur based in New York, United States. As the founder of several successful niche websites, I got the expertise in areas such as making money online, blogging, YouTube, affiliate marketing, and more. Through this website and blog posts, I am trying to provide insightful and actionable tips to help aspiring entrepreneurs, find ways to make money online. Read more.