Newsletters but it's Publish or Perish

Here is the income of some of the top creators who have been “sustainably” able to make a living off of YouTube; divided into 2 parts: YouTube and Non YouTube income.

YouTube reported $8.1 billion in quarterly Ad Revenue exceeding expectations for Q1 2024.

As of today, YouTube has paid out over $100 billion to everyone on it’s YouTube partner program. 

YouTube ad sales is rising at 21% year-over-year; not only this, the YouTube TV subscription brought in $15 billion of revenue in FY 2023. 

The revenue-sharing program on Shorts completes a year early during the first quarter. This monetization option has become one of the strongest revenue streams on the platform.

The number of channels posting Shorts has increased by 50% year-over-year - Philipp Schindler, Chief Business Officer, Google in an Alphabet hearing call.

YouTube has no signs of slowing down!

But only an average of 13% of the total income of these creators is coming from YouTube.

Why is that? Why aren’t they putting their entire effort on YouTube? After all, isn’t it the holy grail of making a living as a creator?

Creator economics are skewed to big creators with the most impressions. Income inequality in the content creation space is a reality; income & revenue are distributed very sparsely. 

The Creator Earnings Report 2023 by Benchmark compiled data on a distributed sample of 2000 creators in all niches, types and ages.

It broadly broke down the income of anyone creating content online into 5 buckets:

In the US, the minimum wage is $14,500 per year and 51.5% of creators earn less than $10,000 a year. 

It’s the money creators make via YouTube AdSense that we’re discussing so far. Though, AdSense is relatively insignificant, YouTube as a top of the funnel/advertising platform/distribution channel is the holy grail. 

Any creator who has been able to sustain themselves has never relied on YouTube AdSense as their primary source of revenue. They are always upto something more; something that has more leverage, access and impact.

Take this for example:

Substack: with an average media subscription cost of $5, to earn you need 1 paying customer

YouTube: to make the same $5 you need around 13 views with an average CPM of $0.38

And before you think it’s not that bad, remember to just get into the YPP you need:

• ≥500 subscribers

• ≥3 public videos in past 90 days

• ≥3000 watch hours in past year or 3M+ short views in last 90 days

So, if YouTube is not enough what are the other platforms or earning avenues as a creator to rely on. Lets keep this for another Armed issue, reply to this email with a 💪 for me to publish it fast.

I want to shift your focus from platforms to content formats for once. There are primarily 3 content formats: Video, Audio and Text.

Though, everyone is building for Video and Audio; I think Text is lately experiencing a remarkable resurgence in the creator economy.

And the data proves it:

1. This is a graph of paid subscribers on Substack since 2018
The platform 3x it’s paying subscribers in just 7 months from Mar 20 to Sep 20.
Today, just the top 10 writers on the platform bring in over $20M/yr.

2. beehiiv raised $12.5M in June 2023 to expand product, bring on more writers and build out its revenues.

3. The recent beehiiv $33M Series B is such a big move for the entire newsletter economy moving forward.

Newsletters give you direct access to your audience which you can leverage in different ways to monetize or go beyond that.

Newsletters are a great way to a sustainable living as a creator as they offer a higher degree of engagement, impressions and revenue.

Email marketing is the highest ROI marketing channels with results reporting to be around 36-42x i.e. for every $1 you invest you will receive a return of an average of $36 to $42.

Marketers are shifting their focus towards email newsletters as a more reliable and direct means of reaching their target audience.

Newsletters are intimate and personalized in lieu with most content on social platforms that are saturated and for brands, money is more diluted as there is more inventory to package offers into (for video content).

It’s basically foundational audience building at it’s core; and newsletters by themselves aren’t the best way to make money.

There is a lot to be done with newsletters (direct access to consumers), and the potential is really untapped.

Creator Science, a branded IP by Jay Clouse is the epitome of leveraging a small audience and monetizing them with newsletters. He earned $350k with subscriptions to his courses with a small 3k audience that he grew through his newsletter.

Creator Economy maximalists, Colin and Samir run a huge business empire on YouTube. No surprises, they have been running a newsletter for 3 years now. The Publish Press curates the latest trends and news in The Creator Economy. Again, the promoters here are ad-based businesses. And, there are some Press Worthy links to articles, tweets and videos which are sponsored advertising content. But, the long-term picture is something else.

Even brands are seeing the value here, how it can link specific campaigns to niche audiences and actually drive ROI. Arnold Schwarzenegger, Boston Globe Media, Brex are some of the biggest brands betting on the potential of newsletters.

The biggest up and coming holding company in the entertainment space, Night runs a newsletter too called Night Light. Just staying in the minds of consumers at all time.

This is me signing off, urging you to take full ownership of your audience!

Understand your numbers.

Understand the consumer you want to reach: content style, content delivery, topic selection, posting schedule, brand integration strategy

Work to maximize and optimize whatever number you’re getting.

Formula to be a Rich Creator: Impact>Influence>Impressions

Evolve, switch content, prioritize audience and work with good brands.

Remember: “Even a small recurring audience is incredibly powerful.”