- Creator 3x3
- Hank Green shares his TikTok earnings, RPM's everywhere, and Creator-Product Fit
Hank Green shares his TikTok earnings, RPM's everywhere, and Creator-Product Fit
Welcome to Creator 3×3!
Here are 3 Creator facts from the past, 3 notes on the present, and 3 thoughts about the future of the content economy...
3 FACTS FROM THE PAST
What’s a good RPM for YouTube?
What’s an RPM?
What’s even happening right now??
As with anything important the answer is “it depends”.
Not the RPM part - an RPM is a revenue per mille and it means “how much you earn per 1000 views” on your content.
It’s a standard term for the advertising (and by default the Creator) economy because payments per view are generally fractions of a cent - so we multiply by 1000 to make the numbers easier to talk about!
But a “good” RPM for YouTube depends on a ton of factors.
Factors like video category, type of ad, geography, time of year, audience makeup, content supply, advertiser demand, and whether the universe hates you or not that day (mostly kidding).
Note: If you’re an advertiser you mostly care about CPM or Cost per Mille and an advertiser’s CPM is always going to be higher than a Creator’s RPM because YouTube (or whatever platform you’re on) takes a cut.
Here’s some historical top RPM/CPM pairs by category on YouTube.
Some niches are much higher than this and some are a lot lower.
Understanding the RPM difference between categories is the first step to understanding why it’s easier for some Creators to earn a lot of cash with their channels when compared with others.
I love GDQ.
It’s a staple event in the speedrunning community and the next one starts on Sunday Jan 14, 2024.
I share this partially to raise awareness, but mostly to highlight something special about the community of Creators in general.
There’s a thread of charity and donation amongst Creators that leads all the way back to the birth of the various content platforms.
Creators have always wanted to improve their communities (and the world) with what they create and Creators made events like GDQ well before it was obvious people could make a living streaming videogames on camera.
They did it for the love of the game and we’ve only just started to figure out how to make that sustainable for them in terms of income.
Here’s one of my favorite GDQ speedruns to check out if you’ve never seen one!
Back to RPM’s!
RPM’s didn’t start with Creator economy. It didn’t even start with the internet.
TV, Radio, and Newspaper ads all used something like an RPM (or really a CPM because they were pitching spots to advertisers not paying out a revenue share to Creators) to charge for access to their lucrative audience's eyeballs.
The internet really supercharged all this stuff though.
The data opportunity, the low implementation costs, and most importantly the speed a viewer could access a web page completely changed the game.
Take Yahoo for example.
In 1999 this was for many the entire internet…
and Yahoo could charge advertisers a $60 CPM for a banner ad on this page!
And they didn’t even make funny videos!
Adjusted for inflation that’s $112 CPM that they didn’t split with anyone.
But it gets crazier.
Paul Graham (mega startup investor and 1.8M follower Twitter king) had his startup acquired by Yahoo in the 90’s and he realized something about the types of views Yahoo was charging for.
Today, users are served (usually) very relevant ads that are customized in some way to their user profile, but back then, platforms had very little tracking data about their users.
So advertisers paid a lot more for essentially unqualified (AKA much less valuable) traffic.
Also all the ads looked like this.
3 NOTES ON THE PRESENT
Hank Green is the man.
He’s an OG YouTuber and content creator (he launched his channel in 2009), but he does a whole bunch of other things too.
Recently, he’s been knee deep in short form content on all the platforms and he has some thoughts.
Per usual, they’re very insightful (and he gave me a great insight for a seemore.tv feature about tracking Instagram CPM’s across months), but the three most important takeaways for Creators I think are:
Hank Green is a world class Creator and somehow can barely pull in $9,000 a month from his (really funny) short form content that has 50M+ views.
His total RPM’s for shorts are $0.11 on YouTube, $0.05 on TikTok (although it’s technically $0.55 on “qualified views”), and $0.04 on Instagram.
Hank’s description of the state Creators getting screwed by platforms:
"It's such a fun situation for Creators right now - where the longest YouTube short you can make is a minute, but shortest TikTok you can monetize is a minute and one second long"
It’s worth a full watch (at least on 1.5x speed 🤷♂️)
Hank talks a lot about his “eligible” TikTok views in that video and for a Creator (or at least for me) the explanations feel pretty vague.
YouTube must have a more straightforward answer right?
For the most part, everyone knows that a view on YouTube might not have an ad if the video isn't ad friendly.
But did you know that there a other reasons that a video might not earn even if it’s monetized?
You won’t get ad revenue if you turned off ads for a video (somebody out there just remembered something important they forgot to do I promise).
There also might not be an ad available to show to that particular viewer.
Since advertisers can choose to target specific devices, demographics, and interests, there’s always a chance your viewer may not match this targeting.
Finally, a user might not be ad friendly too. A range of other factors, including the viewer’s geography, how recently they’ve seen an ad, whether they have a Premium subscription, and other stuff like that would make them ineligible to see an ad on your content (so you won’t get paid).
So ads are complicated.
What’s the next best thing? Is it brand deals? Maybe.
I don’t know I’m all confused now.
What I do know is that Marketers spend the most on influencers on Instagram, followed by TikTok, then Youtube (by total quantity of spend).
This might change in the future future, but 2024 so far is looking about the same.
3 THOUGHTS FOR THE FUTURE
We know ads are hard to make money with. They’re hard for platforms too.
Especially for short content.
Elon can’t seem to to make it work (lol).
YouTube pushing their Shorts is clearly a “I’m scared of TikTok” move not a “Ha ha I’m Mr. Moneybags” winner strategy.
So what’s an ad-supported gigaplatform to do instead?
If you watched Hank’s video, you already know.
The platform tries to sell stuff.
TikTok shops are a huge, ongoing circus over on the clock app.
I’m gonna spend a lot more time on this topic next week, but all you need to know right now is TikTok is pushing so hard on shop that they are offering 30% off and free shipping for pretty much everything on the entire platform.
There’s a ton of issues with TikTok shops (some potentially pretty serious too) and whether they really work for Creators long term without the incentives given right now remains to be seen, but if you’re in the market for a drop-shipped foot massager you can get one for a steal right now.
Other people (including me) have talked about its functionality elsewhere, but I’m here to focus on the future.
Creators basically make money in 5 ways right now.
Niche Specific Revenue lines (live shows for comedians/musicians, consulting for education, events for inspirational speakers, etc)
Running a related business with their content as lead generation
#5 has historically stayed squarely in the “traditional business” realm.
These are real, potentially very lucrative businesses, but they’re traditional business nonetheless.
Viewstats is different.
It’s the digital promised land of zero marginal cost per customer and infinite upside revenue potential on stuff you build once.
My bet on “why viewstats” is that after Beast Burger didn’t pan out, Jimmy has learned a lot and is now running tests in the app economy by focusing on an area where he, frankly, is the dream user.
The Creator Economy is a place where knows a ton of earned industry secrets…
and no matter what anyone thinks about viewstats right now that is usually how the billionaire B2B tech founder story starts.
In startups, founders are desperately looking for “Product Market Fit”.
They need to find the right solution to a user pain point that hits really hard so they can grow really big and really fast.
Ideally, the solution needs solve a problem so painful that a user will look past a crappy user interface and use the product even if it sucks because they need their problem solved so badly.
Creators have a different, but related problem.
They understand their own pain point already (they have no money).
They have an asset most startup founders don’t have (an audience).
And they have to figure out how maximize the monetary value they can gain from the audience without alienating the audience who is already used to getting a lot of stuff for free (like content, creator attention, and swag).
So Creators have to explore, ideate, test, and iterate across a bunch of different existing revenue and product models to find the one or combination that hits with their specific audience.
I call this Creator-Product Fit.
We’re going to explore this idea a lot more in future 3×3’s so definitely subscribe if you haven’t yet!
There’s lot’s of opportunity out in them thar hills, folks.
It won’t look like yesterday’s opportunity.
But it won’t be unrecognizable either!
As we step boldly into that wild, blue yonder we’ll keep posting and iterating and improving through it so 2024 is our break out year
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See you next week,
p.s. if you remember Collegehumor and haven’t kept track of their successor company Dropout’s winding, DnD filled journey then definitely check this video out…