YouTube amplifies monetization options for creators as early tools drive revenue

Brief:

• YouTube announced new and expanded monetization options for creators at VidCon on Thursday, according to a company blog post by Chief Product Officer Neal Mohan. Many of the features touted at the Anaheim, California, show for creators were focused on livestreaming and subscriptions. 

• The platform unveiled Super Stickers that viewers can purchase during livestreams to show support for creators. The animated stickers, which will arrive in the coming months, are available in multiple languages and can be themed around different content categories, such as gaming, beauty and food. They build on the growth that YouTube has established with chat and tools like Super Chats, where followers pay to have their message be pinned to the feed during livestreams. 

• After debuting channel memberships at VidCon last year, YouTube used the show this week to introduce membership tiers, which the company calls levels. Creators can set price points for five different levels that offer different perks to subscribers based on how much they pay. The Fine Brothers Entertainment’s REACT channel piloted the program by adding two higher-priced tiers and experienced a sixfold membership revenue increase, YouTube said.    

Insight:

VidCon, now in its tenth year, has become a crucial showcase for YouTube as creator culture has become a dominant driver of interest in the platform, particularly among valuable young audiences like Gen Z. Amid this shift, the service is putting a bigger premium on livestreaming features like Super Chat and membership tiers, diversifying beyond the standard digital video ad placements that turned YouTube into a revenue juggernaut for parent company Google.

These moves come as YouTube looks to stay ahead of a growing number of competitors, namely Amazon’s Twitch. Twitch is best-known for video game livestreaming, but has generally helped popularize the format’s more interactive features and subsequently become a big draw for marketers, publishers and even professional sports leagues.

Many of the tools YouTube is spotlighting with subscriptions and live chats resemble what Twitch already offers: Super Stickers are akin to Twitch’s Bit Emotes, as noted in TechCrunch, and the streamer had channel Sponsorships before YouTube. YouTube’s closer emulation of streaming rivals appears to be paying off. 

“Early last year, creator revenue on YouTube from Super Chat, Channel Memberships and merch was nearly zero,” Mohan wrote in his post. “Today, these products are generating meaningful results to creators across the globe.”

Mohan said that “thousands of channels” have more than doubled their revenue through these features, though he did not break out specific numbers. YouTube claims that Super Chats, which rolled out two years ago, are now the biggest revenue source for roughly 20,000 channels, a 65% year-on-year increase over 2018. More than 90,000 channels have received Super Chats from users, according to YouTube, and some streams earn more than $400 per minute from the feature.

Merchandising has also become a bigger part of the equation as creators have capitalized on their brand recognition and YouTube has integrated more shoppable interfaces. At Vidcon, YouTube announced five new merchandising partners — Crowdmade, DFTBA, Fanjoy, Represent and Rooster Teeth — that eligible creators can use to directly sell their gear through.

YouTube might be eager to keep creators happy from a revenue standpoint after facing heavy criticism earlier this year for failing to properly enforce policies around areas like hate speech. Other companies have recently ramped up their efforts to win over YouTube talent, potentially picking up on creator frustrations. Facebook, for example, has continued to grow its presence at VidCon, a conference that has been almost entirely centered on YouTube in the past.

Earlier this week, Facebook used the show to promote a number of new creator monetization features. While some speculate that the social media giant is angling to capture more of YouTube’s top creators, it’s doing so through a playbook that looks like the foundations on which Twitch built its appeal. 

Facebook’s freshly announced Stars feature, like Super Chats, share a lot in common with Twitch’s Bits payments system. Facebook is also trying to build out a more diverse creator membership model, including through more intimate groups that are only available to subscribers.