How to Make Money on YouTube: What's Working Now, According … – NextAdvisor

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Nick Wolny is senior editor of the financial independence vertical at NextAdvisor, in partnership…
Posting YouTube videos can make you money. And you don’t need to build a huge audience for the dollars to start rolling in.
“Back in 2015, a friend told me I should consider starting a YouTube channel because that’s where all the heavy hitters are,” says Annagjid “Kee” Taylor, a celebrity hair stylist and owner of Deeper Than Hair, a salon based in Philadelphia. “It freaked me out. I didn’t want to share all my secrets with the world like that.”
“Then a hair client mentioned to me that payouts from YouTube were how she and her husband paid their bills every month. I was sold from that moment on.” Taylor shot her channel’s first video on her smartphone. Seven years later, she’s a millionaire, and her YouTube channel has 1.3 million followers.
Between paid partnership opportunities, ad revenue, and directing viewers towards your own websites or offers, YouTube enables many different ways to make money using video – with or without a big audience. We asked successful YouTubers with a variety of strategies for how to make money on YouTube to weigh in. Here’s what they had to say.
The good news is that you don’t need to be a film school graduate or a GoPro videographer to start generating YouTube revenue. Before we get into how much money you can make on the platform, let’s first define the different options you have when it comes to monetization and having a successful YouTube channel. 
The strategies for how to make money on YouTube can be teased out into three categories:
From video ads to in-platform tips and YouTube premium subscribers, creators on YouTube aspire to get and hold your attention, then allow ads to run on their videos. Every time you watch an ad within a YouTube video, the channel that posted the video gets paid, because the channel has enrolled in the YouTube Partner Program. Google owns YouTube, so part of signing up for this program includes setting up an adsense account.
Each video view only adds a fraction of a cent, but if your video goes viral or has staying power, the views—and dollars—will begin to add up. In addition to YouTube advertising revenue, channel memberships are a way to create recurring revenue on the platform.
If you have an engaged audience, another revenue-generating strategy is to explore paid partnerships and create sponsored content on your YouTube channels. When a creator plugs a product within their video, it’s likely that they’ve been paid upfront to do so, are making money off a commission-based affiliate link, or both.
Many creators leverage YouTube as a way to direct viewers toward other properties: a website, an offer, or an affiliate link to someone else’s product. For any of these strategies to work, however, you need multiple videos, clear video descriptions, and an engaged audience. YouTube influencers and aspiring entrepreneurs alike are drawn to YouTube because it creates opportunities to earn money and build an audience of raving fans along the way.
“It’s harder to grow on YouTube than other platforms,” says Humphrey Yang, an entrepreneur and ex-financial advisor who currently has 653,000 subscribers on YouTube. “It’s harder to establish a community, but those community members will be loyal viewers and fans.”
The number of views or subscribers you need as a video creator for things to take off depends on how you want to make money on the platform. If you’re directing viewers to your website or an affiliate link that pays you a commission, you technically could make money from day one.
“I’ve made 6+ figures from my relatively small YouTube channel,” says Luisa Zhou, a business coach whose YouTube account has 11,900 subscribers. “I started seeing real progress when I was getting, on average, about 400 new YouTube subscribers a month, which took me a year and a half to achieve. The best way to quickly make money from your YouTube channel isn’t to make money off your videos; it’s to direct people to your website.”
It’s okay to focus on both on-platform and off-platform monetiztaion strategies concurrently. If you want to enable YouTube’s monetization features, you’ll need to join the YouTube Partner Program. To be eligible, your youtube account will need to have at least 1,000 subscribers and at least 4,000 hours of public watch time on your channel in the last 12 months.
“YouTube is the second-largest search engine in the world,” notes Jose ‘Caya’ Cayasso, co-founder and CEO of Slidebean, a company that helps startups pitch investors and whose YouTube channel has 354,000 subscribers. “Find questions people are trying to answer, and answer them better than anyone else. Focus on topics that are underserved, rather than competitive ones.”
Whether you enroll in the YouTube Partner Program or not, an overall priority relevant to every monetization approach is to cultivate an engaged following. Develop a sixth sense for what your audience likes to watch and you’ll have a running start when it’s time to start raking in the revenue.
It’s easy to feel intimidated by YouTube stars and video content that looks like it belongs in theatres. Many creators use professional-quality video equipment and even have an entire room or staged space from which they film their videos. Know that you don’t need fancy equipment to get things started.
“You don’t need any expensive equipment to start and grow your YouTube channel,” says Zhou. “I started with just a webcam and a microphone, so that’s what I would recommend for new entrepreneurs or freelancers.” Zhou invested in a Logitech c920x webcam and a Movo LV1 lavalier clip-on microphone to get things off the ground for under $100.
“The audio on your YouTube videos is more important than the picture quality at the beginning,” says Yang. “You can get started with just an iPhone and maybe an external microphone. Starting is much harder than just the equipment; there’s a lot to get over, such as fear of failure, being on camera, actually publishing the video, and having a searchable content strategy.”
If you can record yourself with your phone, you have enough hardware to get started and make money on YouTube. Know that you also don’t have to appear on camera if you don’t want to; many successful channels rely on screen-recorded video footage, slideshows, or stock images with voiceover to create their content.
Before you publish any videos, you’ll want to take a moment to set up your channel first. This means naming your channel, adding a profile picture, and creating a banner that will display at the top of your channel page. YouTube has the most up-to-date specifications for these elements on its onboarding page.
Graphics aside, there’s another more important task you’ll want to prioritize from day one: A search strategy. Remember that YouTube is a search engine; users navigate the platform by searching for certain words or phrases. Instead of trying to show up for general search terms like “how to exercise”, which are saturated with results, focus instead on search terms that don’t have a lot of results yet.
“Iterate fast and make 3-4 videos per ‘experiment,’ taking into consideration your topic, style, and audience,” says Cayasso. “If things aren’t working, change one of those variables.”
Use data points like clickthrough rate and audience retention to objectively determine if your videos are headed in the right direction.
Cayasso also emphasizes the importance of looking at your channel analytics. “Be data driven. Clickthrough rate and audience retention (how long users continue to watch your video) are two key metrics that can objectively tell you if your content is interesting.”
YouTube Studio is where you can see all your channel analytics and even engage with your subscribers. Additionally, there’s a YouTube Studio app you can use to keep up with your channel on the go. 
“I look at my YouTube Studio app almost every day,” notes Taylor. “It’s like I’m looking at my bank account. You are literally watching the numbers grow every day and it makes you want to be more involved. It’s very important to talk to people in the comments and engage. All of that helps you grow your channel at a faster rate; it’s not always about speed.”
Now that you know a little more about the ins and outs of YouTube, let’s dive deeper on three of the best strategies for making money on YouTube.
YouTube is one of the largest websites in the world and gets millions of visitors every day. If you have a service, program, or product you want to make users aware of, YouTube can be a great way to find search traffic.
“I personally recommend that first-time entrepreneurs build coaching, consulting, or freelancing businesses, because they can charge higher rates with a service-based business than, say, if they run an ecommerce business,” says Zhou, who advocates using YouTube as a way to generate website traffic. “The sales process does not end when you get people to your website. Offer visitors a free bonus – for instance, a helpful PDF that teaches them something new – and get them on your email list so that you can continue building that relationship with them.”
The appeal of search-based traffic is that your users are actively searching for answers to their questions. This is a contrast to some feed-based platforms like Facebook, Instagram, and TikTok. If you choose to adopt this strategy, focus more on being informative than entertaining and you’ll go far.
If you’re taking the YouTube Partner Program route and want to make big bucks, you need traffic – lots of it. Even then, the industry you are in can greatly affect your overall payouts.
“Subscriber count is almost irrelevant for making money on YouTube through ads,” says Yang. Your payouts will hinge more on views than on subscriber count. For example, if you’re in the technology niche, you’ll earn about $8 per 1,000 video views, according to Yang. So if you want $4,000 a month in revenue, you’ll need 500,000 views a month, he says.
“Finance gets you a higher payout, between $12-20 per 1,000 views. Dropshipping is the highest, along with videos about Amazon FBA; channels on those topics can get payout rates of $60-80 per 1,000 views. Gaming on the other hand, only gets you about $2 per 1,000 views. So it all depends on the category.”
A word of caution here: This strategy leans heavily on your videos showing up frequently in YouTube’s algorithm, an algorithm that could change at any time. Pay attention to which videos get seen and watched, then do more of what works.
If you have the engagement, influencer marketing could become an income source sooner than you think. High relative engagement rate is one of the biggest things brands and companies look for in a potential brand partner, notes Hallie Wilson, director of brand marketing at Darkroom, an integrated growth marketing agency.
“Companies will look for three things when considering you for a partnership: audience fit, creative storytelling fit, and brand fit,” she says. “Have a media kit that includes different partnership package options. Longer-term partnerships are ideal, but you may need to work up to those by doing some one-off partnerships first to demonstrate how you get your brand partners results.”
Wilson says it’s okay to pitch yourself to prospective sponsors, but what doesn’t work is sending a bland, cookie-cutter email or direct message.
“Imagine that you’re writing a cover letter for a job application,” she says. “ Companies are looking for specificity, strategy, and smartness. Be open to integrating yourself into whatever [the company’s] content creation needs are.”
The good news is that figuring out how to make money on YouTube doesn’t have to be rocket science. What you will need to do is start taking action today.
Decide on your best next moves, block off time to start learning and recording, and you’ll be well on your way to making money on YouTube for months and years to come.
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