Last Updated on 2023-05-07 , 10:26 am
How do influencers make money on YouTube, TikTok or Instagram? And how much do they make?
As a media company, we get asked many questions, and one of the most commonly asked questions is this as well: “How do we make money producing lousy articles and videos?”
Like influencers and YouTubers, our source of income does not have a clear-cut route. In fact, we have several sources of income.
Some of you guessed we make money from all our videos and articles, but that’s not entirely true. Not all of our videos and articles make money and they are still created for other purposes.
In today’s article, we’ll be explaining to you how YouTubers, influencers or new media companies aka content creators make money.
If you prefer to watch a video about this topic instead, here’s a video we’ve done (watch till the end to know why we’re making money-losing videos!):
How Do Influencers Make Money on YouTube, TikTok or Instagram
Before that, let’s look at what a content creator does daily.
A day in the life of a content creator would look something like this:
- Create content.
- Correspond with clients.
- Do a lot of paperwork while complaining about the algorithm.
- Rinse and Repeat.
So, how do they make money?
There are many ways, but let’s look at the first way: branded content.
A client or company would contact the content creator to create content for the company. Once he created the content, he’ll post it on his social media platform.
The amount paid is fixed and the amount depends on how popular he is.
For a content creator to create a branded content, he usually needs pretty good branding with many followers because the client will be associated with the content creator.
What you might not know is that for most cases, an agency works with the content creator instead, not the client.
This is because some companies, mostly the big ones, usually buy their advertisements via advertising agencies and not directly from the source which is the content creator.
For contents like this, the client can decide many of the creative aspects of the contents since they’re the ones paying for it.
If the client wants to use the content on their own social media platforms or even on TV, they’d have to pay a “loading fee”
Because when a content creator creates a piece of content, he still holds the rights to the contents and it’s usually agreed in the contract that he’ll only post it on his own social media platforms.
Therefore, the client needs to pay the loading fee to buy the rights or the licenses to use it on their own platforms.
Now, let’s address the elephant in the room:
How Much Money Do Influencers / Content Creators Make?
We’d love to give you a figure, but unfortunately, there’s no exact market rate, especially in Singapore when the market is so small that the amount can vary a lot, depending on how much the content creator is comfortable with.
But for media buys from advertising firms (remember, these firms represent brands so we’re talking about big companies or government agencies), it’ll be quite expensive, from thousands to tens of thousands of dollars, especially if we’re talking about a short video production.
This is because video production itself would cost a lot of money, even if it’s a one-minute video.
Now, if a company doesn’t have a lot of budget for advertising, what should it do?
Programmatic Advertising
This is more for media companies and YouTubers, instead of Instagram influencers.
Basically, it’s the automated buying and selling of online advertising space between articles (you’d have come across some in this article), and in YouTube or Facebook videos where you see the advertisements in the middle of the video or right before or after the video.
The advertisements spaces on the video will be bid and an auction will take place. The auction will take place in nanoseconds and everything is programmed, which means no one is monitoring the entire auction.
The creator only has two choices in such situations: to include advertisements or not have advertisements.
This also allows advertisers to target their advertisements, since the platforms like Facebook or YouTube would know a video’s demographic.
For example, if there is a prank video and the creator opt to enable advertisements in the video. The advertisements can be about … toilet paper, since, erm, people who like watching prank videos are usually watching them in the toilet? I hope you can tell that I’m joking.
Whereas, if the content creator makes videos about property investments, the bidders are probably property developers, so they’ve more budget to bid for a higher price as the viewers are most likely affluent people looking to buy ten houses at one go.
On average, programmatic advertising only brings in about $2 to $5 per one thousand views on YouTube or Facebook in Singapore – it’s better than countries like India or Malaysia, but not as good as countries like the US or UK.
This means that in Singapore, you could potentially just earn $2,000 for a million views.
You’ll therefore need lots of views to depend solely on programmatic advertisements to make a living.
If you compare that to branded contents whereby you earn $20,000 for 100,000 views (or any number of views since it’s a fixed price), you’d understand why people prefer to have branded contents.
Usually, the bigger content creators depend on both sources to earn money.
Smaller ones like an influencer with just Instagram followers would have to depend only on branded content while a small website, which by the way is also considered a content creator, depends purely on programmatic advertisements since they might not have the branding to attract branded contents yet.
Now, let’s address the other elephant in the room:
How Do You Know if a Content is a Branded Content?
By right, content creators must disclose that the content is paid for by another company, and platforms have been getting stricter with this.
Different platforms have different ways to showcase that; for example, for this video we’ve done for Nee Soon Town Council as a branded content, the words “Includes paid promotion” are indicated clearly on the YouTube video (when you play it):
On Facebook, you’ll see the words “Paid Promotion”:
Some content creators don’t do that because sometimes clients specifically request to leave that out, which, by right, isn’t allowed.
So, for all you folks who think we’re sponsored by the authorities for making that video about minimum wage and TraceTogether, you should now know we didn’t receive a single cent.
Why Do Content Creators Still Create Content if They’re Not Getting Paid?
A short video might cost $5,000 to $10,000 to make, and the returns could be mere $100.
So why would content creators still make these videos?
One: they’re bankrolled by their parents, but let’s leave that for another article.
The second, and most feasible, reason is that content creators must create consistent content to tell others that they’re still in the industry, kind of like how newspapers need to be printed daily even if it’s a slow news day.
For example, if you see a YouTube channel with its latest video being posted six months ago, you would have speculated that the YouTuber has “quit” and unsubscribe. Thus, content creators are trying to stop you from doing that.
Please don’t unsubscribe from our channel, we’re still alive.
But the third, and most important, reason?
The Algorithm
Here’s the reason why some content creator’s videos are not showing up to viewers – the algorithm.
Unlike the good old days when all your Instagram and Facebook posts would be shown to all your friends, the industry has moved from a “social graph” to an “interest graph”.
Thanks to the algorithm, not all the content from the channels you subscribed to or accounts you follow will be shown to you.
This means that even if you’ve lots of followers, you won’t be seen unless you keep on posting new stuff that interests people.
Basically, for a content creator to be continuously seen by his followers, he’d need to consistently create new (and engaging) contents if not the platform would show his followers posts from other content creators.
Just think of it as a broken long-distance relationship.
If a content creator hasn’t been creating new content, the follower won’t be seeing the content creator for months.
During these months, the follower would be recommended other contents by other creators. So even if one day, the content creator comes back with a new content, it won’t be shown to the follower.
Because it’s like a guy who came back to Singapore after the border closure only to realise the girl he was with, now has a new boyfriend. Cue sad music.
After all, remember when that girl goes to Instagram, Instagram will show her even better contents and she will eventually fall in love with another content creator.
Just so you know, we’re not talking about the physical act of the follower unfollowing the content creator; instead, it’s the algorithm that connects the follower with the new content creator.
Thus, you shouldn’t just think that content creators are just people who’ve got nothing better do to.
It’s a business and here’s how we here at Goody Feed visualise ourselves: We think of our contents like videos and articles as products to fill the supermarket shelves with. Products like, erm…tissue paper and toilet rolls.
The supermarkets are akin to platforms like YouTube or Facebook.
We have to constantly provide them with products (give them contents), if not, they’ll put other creator’s products on their shelves, and our customers will buy the other creator’s products instead.
So yes: you can subscribe to our YouTube channel whereby we’d have three videos a week: one listicle that’ll educate you about something you should know about, one explainer that’ll simplify even the most different subject to you and one skit that’ll also hold a meaningful message.
Featured Image: Atstock Productions / Shutterstock.com (Image is for illustration purpose only)
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