If there were a prize for the "business of the century", the award would surely go directly to the showcases of Google, which in 2006 paid "just" $ 1.6 billion for YouTube, an online video platform that barely took its first steps but It already showed its potential as a content generating plant.
The investment of the Silicon Valley giant undoubtedly paid off: in its latest annual balance, the section dedicated to YouTube recorded revenues of US $ 15,000 million in advertising only. The unit also contributed 10% of the total income of its parent company, which reached US $161,000 million.
Put in perspective, the figures reveal that the advertising business generated by the video service is six times larger than that of Twitch, its great rival owned by Amazon, whose strength is the streaming of gamer content.
Also, that $ 15,000 million is equivalent, nothing more or nothing less, than 20% of total advertiser spending in the entire US TV industry. It is, in short, a gigantic business, which in the last 3 years generated more than US $ 34,000 million in revenue produced by guidelines.
In 2019, $ 8.5 billion were allocated by YouTube to "content acquisition", a locker that includes payments to creators, the most important leg of its business responsible for generating clicks of the 2,000 million users that enter per month to your platform
It is precisely the content creators niche one of the great revolutions generated by YouTube in the era of "post-television": in 15 years of life, the service went from being a tool to share videos to be a capable colossus to create "rich and famous" anywhere in the globe.
The business
According to data provided to iProUP by YouTube, worldwide, the number of creators that generate an income of five annual figures in dollars has increased more than 40%, from December 2018 to December 2019. They can even reach eight figures in the case of the most watched channels in the world.
A ranking of Forbes revealed the top 10 revenue per creator from last year, composed as follows:
1- Ryan Kaji (an 8-year-old boy who makes game reviews): $ 26 million
2- Coby Cotton, Cory Cotton, Garret Hilbert, Cody Jones and Tyler Toney (Dude Perfect): $ 20 million
3- Anastasia Radzinskaya (a five-year-old girl): $ 18 million
4- Rhett McLaughlin and Link Neal (Rhett and Link): $ 17.5 million
5- Jeffree Star: $ 17 million
6- Preston Arsement (Preston): $ 14 million
7- Felix Kjellberg (PewDiePie): $ 13 million
8- Mark Fischbach (Markiplier): $ 13 million
9- Daniel Middleton (DanTDM): $ 12 million
10- Evan Fong (VanossGaming): $ 11.5 million
A particularity of the list, which is not less, is its global character: to be a "star" on YouTube you don't need to be based in Hollywood. Its market, in that sense, has no barriers or licensing agreements.
"The business model is based on advertising and implies a mutual benefit: advertisers guide the platform according to formats and strategies, depending on their objectives, and, at the same time, allow creators to capitalize on their talent through monetization. of its contents, "they explain from YouTube to iProUP.
"In this way, the latter get support from related brands to their content and, even more importantly, to their audience. And companies are strategically present on the platform: in videos that really interest their consumers," they add from the company.
In addition to the traditional guideline, YouTube highlights that, since 2018, the income of creators through systems such as paid Chats (Super Chat tool), Channel Memberships and Merchandising increased significantly, with thousands of channels doubling their monthly income with these New alternatives
"In fact, there are currently more than 100,000 channels that use Super Chat, and some broadcasts generated more than $ 400 per minute," they reveal.
Monetization of content is not given by "spontaneous generation"; Uploading a video is only part of the process. Strictly speaking, creators must be part of the YouTube Partner Program and comply with certain guidelines that include:
- Have more than 4,000 hours of public reproduction in the last 12 months
- More than 1,000 subscribers
- Have a linked AdSense account.
In Argentina, the number of creators who earn income with their videos grows year by year. Of these, 90 have channels with more than one million subscribers and some have become true entertainment factories that compete hand in hand with the big players in the sector.
The secret of success
The select "group of the million" Argentine is led by one of the most relevant players worldwide in the YouTube universe: The Children's Kingdom.
It is a "heavyweight" with 30 million subscribers in its main channel (it is located 11th in the world ranking of visits) and more than 90 million if its secondary channels are added, dedicated to different own productions and adaptations for audiences of other countries, such as the United States, Brazil and Russia.
Likewise, at the local level his leadership is so marked that he occupies four of the five positions of the Top five channels: In addition to El Niño Infantil, he adds his products La Granja de Zenón (19MM subscribers), El Reino a Play (11.3MM subscribers) , and the Plim-Plim Clown (4MM subscribers) on this podium.
In dialogue with iProUP Victoria Quiroga, Head of Marketing of The Children's Kingdom, highlights key aspects that made the animation channel a recognized brand across the globe.
"Thanks to a consumer-centric logic completely opposed to the passive traditional media model, hundreds of original digital productions were very well received by the public from the beginning. As a result of the interaction that these platforms allow, successful digital content not only managed to build stable audiences, but faithful communities, "says Quiroga.
However, the executive notes that "the licensing industry, on the other hand, had great resistance from the beginning to invest in digital native intellectual properties whose content was not shown on linear television."
The paradigm shift, however, prevailed: success stories were already noted that broke down those barriers, such as that of its most successful production, La Granja de Zeno, content that has been available only on digital platforms for 3 years, without going through the TV, and that already developed an extra business of more than 400 licensed products.
The merchandising adds a fine work of capturing guidelines that, again, breaks the old molds of children's television productions.
The executive reveals to iProUP that the advertising industry has also had to pay special attention to this type of content, for two main reasons: "On the one hand, for the engagement they generate with the audience, being measurable and scalable for customers, and on the other, given the creative possibilities to integrate products and brands to storytelling in a natural way. "
Currently, they plan the contents under two great needs, both seasonal or one shoot content to get up to latent trends in social networks, as evergreen content, that is timeless content that always generates interest.
Quiroga also clarifies that a fundamental factor to add new audiences was "the collaboration with other international creators offering space in our network to leading IPs such as Peppa Pig, PJ Masks, Cleo and Cuquín, Oddbods and Molang among many others".
Thus, from this exchange of audiences, they managed to develop new markets and meet the growing demand for audiovisual productions. Today, more than 20 people work for the different channels of the Children's Kingdom and the income exceeds 7 figures in dollars per year (the SocialBlade platform estimates for US $ 10 million annually).
For Quiroga, the "secret of success" is that "unlike many platforms and the traditional broadcast patronage model, it allows content producers to quickly test whether a proposal works and pay for their own productions."
Iterar was, in that sense, the key tool that allowed them to measure themselves head-to-head with the great studies of the United States and go out more than airy.
From the bed to the world
The "million group" is also composed of productions created by the lungs that became true phenomena of audience throughout Latin America.
SupraPixel was born in Nicolás Fischman's room and, in just five years, became a reference channel for his segment with more than one million subscribers.
In the manner of the recurring myths of the "garages" of Silicon Valley, what began as a passion-driven and hobby-driven bet became a full-time job with a high level of professionalism.
In a dialogue with iProUP, Fischman points out that today the user communities "accept much better or welcome the support of a company. They understand that doing this is an absolutely legitimate job that takes time and effort, and that the livelihood of a brand lets you make better content. "
His channel no longer works solely to satisfy an Argentine audience; Their growth allows them to look beyond borders.
"We are oriented to what is regional content and to speak globally. We have contacts with the HQs of the brands to be able to do so. We bet to leave the niche and‘ point to the mass, "he reveals. And he adds that "considering that all people use technology and enter YouTube, the second largest search engine in the world, we target almost everyone."
The income for this type of channels allows those responsible to live only from what is entered through advertising through YouTube. However, Fischman clarifies that "whenever other sources can be added."
In that sense, he explains that, to live solely on advertising, "you have to have a high and constant traffic, especially to cover months of low audience for stationary issues." Like any online production, it forces you to be 24/7 on the product so as not to lose relevance.
Finally, the content creator reveals why, despite the strong competition of Facebook, Instagram or Twicht, YouTube remains the king of online video.
"We can complain a lot about many decisions they have made. But it is the best platform there is today to create video content, quality productions in both image and sound," he emphasizes, adding: "It is one of the few which allows uploading in 4k, HDR, 60fps. That on Facebook or Instagram is, for now, unthinkable. "
Large, medium or small, more and more creators are surpassing traditional TV with blockbuster, dynamic and 100% digital productions. 15 years after the first video was uploaded to YouTube, today the online video is a millionaire industry with no apparent ceiling and in Argentina it rises against any situation: the bet, everyone agrees, is international.
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