Transcription
So, how much do brand deals actually pay? I will show you the most I have ever made in ad revenue from a single video. And I know creators that make like 40K a month just doing this. And if you're in this niche on YouTube, brands will pay you a lot more.
Hello, this is Taylor. If I do my job well today, and I plan to, this will be the most helpful video you ever watch when it comes to making money as a content creator. Okay, that's a strong statement, but it will be helpful, I promise.
So, why am I making this video? Well, if you guys missed the update, I left my corporate consulting job to be a full-time creator—big update! And on that video, I got so many comments from you guys asking if I'm leaving New York now, or if I can still afford to live in my apartment, etc. Totally valid questions that I didn't even think to address. And those comments made me realize I really haven't talked about my finances as a creator and just how lucrative of a business this can be. So today, let's talk about that, shall we? Specifically, all of my revenue streams in detail, and how big of a portion each one takes up of my total income; breaking down each income stream and how I got started and grew each one. And then, at the very end, we'll cover my plan to diversify my revenue streams in the future.
Now, without further ado, let's go back to some third-grade arts and crafts, shall we? So, starting with my income breakdown, we're going to take a look at what my revenue streams even are, what they looked like a few months ago when I was still in consulting, and what they look like now, because there's a big slice of the pie missing now.
So, quick context: I went into management consulting after graduating from college, which is a very time-consuming but well-paying job. I also worked on my YouTube channel for all the years that I was in consulting. And at first, it was the side hustle, and then over time it became more like a second full-time job in terms of revenue and time that I took. And now I've left consulting to be a full-time creator.
So, at the tail end of my consulting job, my income pie looked roughly like this: with my revenue streams from YouTube constituting about 43% of my income. And this includes brand deals, YouTube ad revenue, and affiliate revenue. We're going to dive into what all those things are in detail, by the way, along with some revenue ranges that I'm going to tell you, but I just wanted you to see this rough breakdown first. This aggregate 43% from YouTube was followed by about 38% of my income from my corporate consulting job. And finally, this last slice of the pie I actually wasn't going to include because it's not realized income, but it's a big enough slice of the pie that I would be remiss to not include: my investment income. This is solely appreciation on my stocks and investment income that I've made from dividends that I have set to automatically reinvest. This does not include contributions, obviously; that would be double-counting, and it's not liquid. I didn't actually sell these stocks, but I could have, and if I did, the appreciation alone would have accounted for about 19% of my income pie based off of last year's figures. Okay, okay, okay.
Now I've left consulting, so there's a big old piece of this pie missing. But as a result, I've, of course, hopefully ramped up my YouTube income. So my income streams now look like that, with YouTube revenue streams now constituting 74% of my income, which makes sense—it's my full-time job. And about 26% from that unrealized investment appreciation, which again is not cash in my pocket, but more of an illiquid representation that will vary from year to year.
But let's get a little bit more specific now. What is even in this big ass bucket? Well, about 59% of this whole entire pie is from brand deals alone, which is too big for my liking, but more on that later. About 15% from YouTube ad revenue, and less than 1% from affiliate revenue.
Okay, Taylor, so what even are these things? Well, I'm going to tell you exactly what each one is, how I got started with each one and ramped them up, and give you some revenue ranges or exact numbers in some places.
So, starting off with the biggest slice: brand deals, AKA sponsorships—you'll hear me use them interchangeably. I'd imagine it's a bit surprising just how big of a slice this is. I don't know, maybe it's not surprising to you, but I remember when I was first starting, the concept of brand deals/sponsorships was just so mysterious and foreign to me. So let me demystify it for you and tell you what they even are, how I started to get them, different types and structures of branding deals, and how much money brands actually pay.
So what are brand deals? Well, in my case, because there are lots of different kinds, it is those things that I do in my videos when I take a minute in the middle of the video to tell you about a brand. Oh, like when you start talking to another version of yourself? Yeah, that's usually how I like to do it.
Totally. Well, a brand that you should really use now that you're a full-time creator is Kajabi. Yeah, I know Kajabi is great, but tell me more about it. So it's a really easy-to-use all-in-one platform for creators and entrepreneurs to build successful businesses online. That's good stuff. Mhm. They give you a platform to create recurring revenue streams, and with Kajabi you get robust analytics, which I love; easy payment options; email templates; and customizable website templates, all built in. Amazing. But speaking of revenue, CU, that's kind of what this video is about—how much of a cut do they take? That's the best part—Kajabi doesn't take a cut of your revenue; everything is owned and controlled by you, so you keep 100% of what you earn. Fantastic. Where do I sign up? Well, right now Kajabi is offering a free 30-day trial to start your business if you go to kajabi.com/taylorbell. That's K-A-J-A-B-I dot com slash Taylor Bell. Thank you, other Taylor. You're welcome. Kajabi.com/taylorbell and join the creators and entrepreneurs who have made over 6 billion. We'll do. You can head out now. Ah, yeah, very nice. I'll see you later.
I guess that was a brand deal, and Kajabi has been a great sponsor. We'll get into what different deal structures look like and how the fee is determined in just a little bit, but let's back up first. How did I even start getting brand deals? This was the thing that was so mysterious to me, especially before I had any friends in the content creator space. I was just… just scouring the internet looking for information on this, and it's not that publicly talked about. It's still a pretty new space, and so there's a lot of green space here; there's not really a blueprint, I would say, for exactly how to do this—at least it's not super public. So anyway, that's where I'm coming in. So here's the process in a nutshell: brands will reach out to me through my business email; negotiations will occur on the rate that they'll pay me, as well as the talking points in the ad read—ad read, that's me reading the advertisement; that's called an ad read. I will film the segment and then send it to the brand for a review; they may or may not ask for a few revisions; then I slot it into my video, and I get paid for that.
So my experience with brand deals was a very gradual and cautious one, I would say. So I made a business email and a public Instagram the day that I started my YouTube channel because I knew that I wanted to treat it like a business—monetizing passion since '97, am I right? And as my channel grew, I started to get more and more emails from brands and from third-party creator marketing agencies that broker the brand deals. I'd say that most brand deals in my experience have gone through a third-party creator marketing agency versus dealing with the brand itself, although I've done a decent amount with the brand itself too.
So I started small in the beginning. Most of the emails that I was getting from brands was asking for an ad read in one of my videos in exchange for free product. I personally wasn't interested in deals like that; I just… I don't need any more stuff; I already have too much [ __ ] in my room. So I pass on all of those until the first deal that I really felt good about came along, which for me meant that it was a brand that I knew very well and trusted, and they were actually offering payment instead of just free product. The brand was Skillshare, actually. That was my first sponsorship, and then it just grew from there, and I got paid more and more as my channel grew. And I did all of the negotiations and read all of my own contracts for years, and I just looked up on Reddit and YouTube what to look out for in the contracts. And then eventually, I started to make more content creator friends that I could like talk about this stuff with.
Now, next little subsection here: different types of brand deals. So let's circle back on something I just talked about on how a lot of brands reached out to me offering free stuff. Some brand deals are exactly that, where as payment they're offering you free product or free subscription to their service for x amount of months. Yes, I passed on deals like that, but does that mean everyone should? Absolutely not. And here's why: especially when you're just starting, it actually makes a lot of sense to take on certain deals like this because you're building your credibility as a creator. No one else has to know what you're getting paid, or if you are even getting paid. So let's say that deal from Skillshare came in way back in the day, and they were offering free subscription to their service; I might have even taken that because Skillshare is a big reputable name that I knew and trusted, and so that would have built my credibility as a creator, even if I wasn't being paid actual money. Cuz then if other brands saw that and saw, "Oh, Skillshare sponsoring her, that's a good sign; let's see if we can sponsor her too," and then you can build from there. So I actually think it makes a lot of sense to take deals like this, especially in the beginning, to build your credibility; or if you just want free stuff, that's cool too. But the type of deals that I like are ones that offer money. Now, there can be a ton of different payment structures for deals like this, but the two most popular ones that I've dealt with are: one, the flat fee payment, where a brand and I agree on a certain flat rate—dollars for a 60-second ad read in my video, regardless of how the video performs; and two, performance-based brand deals, where I will get paid up to a certain amount depending on how many views the video gets. Now, of course, you can get fancy with the deal structure and have some combination of those two, where it's a flat fee plus performance-based, or where free product is part of the payment. Like, obviously, there are kind of infinite ways to structure this; those are just the two main ones that I've seen.
Okay, something that I think we're all wondering, and what I really wondered when I first started, was: how much do brands actually pay? And as a creator, how do you determine how much to charge them? I could speak at so much length on this because there are a lot of things that go into how that rate is determined, but I will tell you the two things that I think are the most paramount to consider here: one, CPM, which means cost per mille or cost per thousand views—I'll explain; and two, your niche as a creator.
Starting with CPM—cost per thousand views. So a lot of pricing models in advertising and marketing is based roughly, if not directly, on a CPM. Now I'll stop saying it without telling you what it actually is: CPM is a dollar figure per thousand views that a brand will pay, or that as a creator I will charge, to have an ad in my video. And this CPM is determined off of many different things: so the brand itself—I'm sure they all calculate how much it costs to acquire a new customer and then go from there; you as a creator and how engaged your audience is; the type of video that you put the ad read in, because some of your videos perform better than others, etc. And that actually brings me to the second point: your niche as a creator. The niche you're in as a creator will also largely determine how much a brand will pay you because your audience demographic will vary a lot based off the type of videos you make. And you guessed it—maybe that some brands in certain… certain niches pay a lot more than others. A classic example is the finance space: so credit cards, banks, fintech companies, software as a service companies—these brands generally will pay more because: one, their product is probably just more expensive; two, they're targeting a more affluent demographic; or three, some of them are probably just sitting on more cash. So CPMs in that niche—finance and business—are known to be the highest. And on the other end, the general lifestyle space is known to have the lower CPMs. But… but as I said, there are so many other factors that are considered, like the creator themselves. Take me, for example—actually, don't take me; take a creator who's like squarely in the lifestyle niche. Yes, CPMs in lifestyle are known to be lower, but let's say that creator has an insanely engaged audience that really, really loves the creator and will buy anything that they recommend—brands will factor that in and know that that's a valuable creator to have promoting their product.
Okay, so with this information, how much do brands actually pay? Well, I know some lifestyle brands that have CPMs as low as $20, and I know some personal finance brands that will pay nearly a $100 CPM. So to see how big of a difference that is, let's take a video that's expected to get 100,000 views, for example. That example is a difference of $2,000 versus $10,000. So the semi-unsatisfying answer is: it will really vary based off of all the things that we talked about, but this gives you kind of a range at least. Again, in this example… example. This is a video with 100,000 views; you can assume that the more views a creator gets, the more their content skews towards something kind of business or finance related, the more engaged their audience is, the more money they make.
So moving on to my second largest slice here: my investment income—much quicker because we basically already covered what that is. But again, it combines my appreciation on my stocks as well as the investment income that I have from dividends that I have set to automatically reinvest. Obviously, this is very subject to change year to year, but based off of the trailing 12 months, that is about the percentage we're looking at. I don't bucket this asset as cash flow in my own mental accounting because it's literally not, but I guess also just thinking like moving forward, I would love for this pie slice to become bigger and bigger; I would love for it to be the biggest slice; that would mean that my money is working for me, and I like that.
Okay, moving along swiftly to the next largest slice: YouTube ad revenue. This should be a breath of fresh air because it is so much more straightforward than the whole brand mumbo jumbo that we just talked about. It is literally a formula, and I'll show it to you. But what even is this? It's what I get paid when you see an ad at the beginning, middle, or end of my video—like the ones that YouTube puts on the videos that you know you can skip after a while. And I cannot choose which advertisers show on my videos in that capacity. These are brands that come to YouTube and pay YouTube to have their ads shown on all these different videos, and then YouTube's algorithm decides where to disseminate those ads based off of the consumer's viewing behavior, the creator themself, what type of video it is, etc. I'm not sure all that goes into that decision-making process, cuz that's out of my hands, but I can tell you how I get paid from these and exactly how much.
So remember back in the brand deal section where I said a creator's niche will largely determine their CPM? Well, it's the same with YouTube videos. So each and every one of my YouTube videos has a different CPM that is determined by YouTube's algorithm, and these CPMs change every single day slightly. So here's an example: let's take a look at my "Left Consulting" video that I published about a month ago. Now, navigating to the revenue tab, we see that the YouTube algorithm has determined that the CPM for this video is about $19.2. Again, it changes every day; it was a bit higher when I first uploaded it, then it dipped back down, then came back up—it changes. But the number that we should really look at is RPM, which is revenue per thousand views, and that's what goes in my pocket because YouTube takes 45% of ad revenue. So my RPM on this video is $8.58, and at the time of writing this script to this video and taking the screen recording, my "Consulting" video had 167,000 views. So then it's just a simple formula: revenue per thousand views of $8.58 times the 167.5 that video has made me $1,421 of ad revenue.
If you're curious, the CPM of some of my other videos and which ones have the higher and the lower ones—my videos that deal more broadly with… with personal finance or business topics or just making money in general tend to have the higher CPMs, while like pure lifestyle vlogs usually have lower CPMs. Here are some examples. And if you're wondering if my CPMs are high or low, they're on the higher side because I fit somewhere between business and lifestyle, but I have personal finance creators with CPMs of nearly $40, which is like very high, and lifestyle creators with like $8 CPMs—so a lot of variation. Also, your audience demographics plays a huge role in your CPM; the more American your audience is, the higher the CPMs. Other countries with higher CPMs is like Norway—well, Scandinavia in general, the UK, Switzerland, Australia—basically where the cost of living is higher and people have more disposable income, advertisers will pay more to have their ads shown on videos with viewers from those countries.
So what is the single most amount of money that I've made in ad revenue from any video? Well, it is from this video, which currently has 5.2 million views at the time of filming this, and it's a lot of money, but it might not be quite as much as you expect because CPMs on videos like this are just not very high. So, drum roll: I have made, just from this video alone, just in ad revenue, about $188,000. Not too shabby. And this video is a great illustration of why I love this income stream so much, even though it's not a huge part of my pie, and it's because, for the most part, this is passive income. Obviously, I have to make the video, but once it's published, it's there forever to just keep getting views, and I make money on those views forever. Take the apartment tour video I published almost 2 years ago now; I haven't touched it since then, and it still gets thousands of views every single day, and that is just sweet, sweet passive income. And it's also for this reason exactly that ad revenue even makes up 15% of my pie—a lot of that is residual income from views that I'm getting on old videos versus brand deals; I consider that like very active income—it's one payment and done.
Okay, last thing here: if the equation is CPM times views for ad revenue, well, we've already been over CPM, but what about this whole second part of the equation? How do you get more views? Well, obviously, that's a whole another can of worms, but there is kind of an equation here too. YouTube really likes to see two things: one is a high click-through rate, or CTR, which is the percentage of people that click on your video when your thumbnail is presented to them; and two, watch duration, meaning what percentage of your video do the viewers watch? The higher the better, because that means you're keeping people on YouTube's platform for longer, and the algorithm really likes that. Anyway, I don't want to get too into the weeds on this, but this video literally is about how I make a living as a creator, which, to its core, really boils down to viewership, so thought I'd throw in a little sweet treat on the whole viewership thing.
Okay, final slice: it is a very small one for me, but a huge one for some other creators I know. We'll talk about it in a second, but it's just a very popular income stream among…
Creators and it's just a great passive way to make money. And that is affiliate revenue. So what even is that? It's basically commission that I earn on an item, usually 1 to 3%, if you purchase that item through one of my personalized affiliate links. For example, if you scroll down into the description of all of my videos, I have links to the equipment that I use to film my videos. And those aren't just normal links; those are affiliate links, meaning that they're personalized to me, and I earn that very small commission if you purchase the item through that link. And hopefully it goes without saying, I don't link anything that I don't actually love and use myself. What I have linked are my headphones that I've used every single day since I was 19 years old, or like my trusty microphone that I use in every single video, stuff like that. Okay.
So, in the same bucket as affiliate revenue, in my mind, is the income that I make from referrals. Epidemic Sound, for example, which is an amazing Swedish, global, royalty-free music company that I have used and swear by for years. I have a link in my description for a free 30-day trial, and I've now referred enough people that my subscription is now free, and I earn a little kickback from people that become paying members, which is sweet. That is just, again, straight passive income from referring something that I actually use and personally love myself. So yes, this is, like I said, a very tiny slice of the pie for me, but every little bit adds up. And what I find so interesting is how big of a slice this is for some other creators. Take my friend Shervin, for example, who is in the health and fitness space on YouTube. He does a lot of wearable fitness device reviews, and on average, those items are like pretty expensive things. So if he earns commission on those expensive things and just like refers more people because his video is a pointed review video, that adds up. So there are just some content niches that are a lot more lucrative in terms of affiliate revenue potential. So I just find that really interesting how something that makes up 1% of my pie could make up 50% of someone else's, just because they're in a different niche and make different kinds of videos. Okay.
Final section: my plans to diversify for the future. Because if we look at my pie right now, that is basically two slices, three, four, whatever, if you count this investment change, which once again is unrealized, and affiliate revenue is just like not a big one for me, but that's okay. But from my own business perspective, this is just far too concentrated for my liking, and I am very excited to diversify more over the next year now that this is my full-time job. So what are the other streams that I'm hoping to add? Well, I have four in mind that I want to add this year, and I will tell you two of them. The first one, you may have guessed it, is merch. So merch, merchandise, is a very popular income stream that many, many creators will do at some point in their lifespan as a creator. I haven't done it yet, up until this point, just because I've had two demanding jobs for the last few years, so it's just kind of always fallen on the back burner, and I've just stuck to my bread and butter of making videos. But this is the year of Taylor Bell Unleashed, so I'm very excited to put merch out. Stay tuned and follow me on Instagram because I'm definitely going to be asking my followers what kind of merch they actually want. So yeah, follow me over there to have a say.
Second revenue stream that I definitely want to add sooner than later here is contracted consulting. Yes, I left traditional management consulting, but still always will have consulting in my life in some capacity. Specifically, my plan is to do consulting calls for businesses that want to quickly get up to speed on topics surrounding the creator economy. And that might sound so specific and niche, but believe me, I even saw this at BCG: a lot of projects are starting to have an influencer marketing component to it, or yeah, anyway, it's a growing industry, so it's really not a surprise. I'll keep you updated on this income stream in the future. I'm super excited for it. It will keep me sharp, plus I have, you know, background in consulting, so that definitely is some helpful context. Okay.
Outro. Final question for you guys: I plan on making a lot of videos on what it's like to do what I do full-time, what life as an entrepreneur in New York City looks like. But please, my question is this—well, first question is actually if you'd hit the like button, subscribe for free, to support my full-time job. I can't tell you how much it helps me out, and I will make bigger and better banger videos for you this year. But the other question was, like I said, I'm going to cover what is like to kind of live this life, and so let me know in the comments specifically what you would like me to cover. I still, to this day, read every single comment, so believe me, I will see whatever you say and absolutely take it into account. If you made it this far, thank you. I love you. Subscribe for free, and I will see you very soon. Turtle out. Okay. Testing, testing, testing. We're talking income streams. We're talking income streams. Stickman dabbing. For when I actually write, should I practice writing something? Maybe I should. And we're going to need a rag to erase that. Okay, here's the rag. It doesn't equal Taylor, but I'm seeing if you can read this. It doesn't equal Taylor at all. In fact, I'm using my eraser to blow my nose. Nice trusty spatula. Oh good, my roommates work from the office. What if they just walked in on my little—on my presentation here? That'd be fine. They're going to see it anyway, but you know what I mean. Come oopsie oopsie. All right [Music] swag