How to Make Money on YouTube

FT Contributor
A woman who makes money off YouTube holds up the app on her phone.
Reading Time: 5 minutes

More than two-thirds of the global workforce works remotely. In addition, 37% of the U.S. workforce is working in the gig economy either part-time or full-time. There are a variety of different jobs fueling this shift from the traditional career arc, including the influencer/content creator role on YouTube.

It may seem odd to think that a video breaking down a movie or reviewing an article of clothing could bring in significant income. However, there are actually several different ways that YouTube personalities are using their channels to generate serious quantities of cash.

How Do You Make Money on YouTube?

There’s no single formula for how to make money on YouTube. In fact, many influencers utilize a variety of different options at their disposal. Here are a few of the most popular ways to make an income through a YouTube channel:

Ad Revenue

The most obvious way to make money on YouTube — obvious because everyone has to watch them every time they click on a video — is to monetize your channel with ads. Ad revenue is generated when a creator allows Google to advertise on their channel by playing ads before and during each video. There are several pros and cons to using ad revenue on your YouTube channel:

  • Pro: No upkeep is needed — you can set and forget ad revenue, leaving Google to do all of the heavy lifting.
  • Con: You have to share the profits — Google keeps 45% of the ad revenue generated by your channel.
  • Pro: It’s good money if you have viewers — while there’s no hard figure, it’s estimated that YouTubers can make as much as a penny per view, which quickly adds up if you have thousands upon thousands of views.
  • Con: There’s a payment threshold — you can’t cash out on your ad revenue until the balance on your account reaches $100.

Affiliate Links

Influencers have been a popular marketing channel for years now, and the rise of micro-influencers, in particular, has made affiliate marketing an excellent option for a thriving YouTube channel.

Affiliate marketing takes place when a YouTube content creator promotes or reviews a particular product and then includes an affiliate link to access the product in their video, in the description, or in both. The affiliate link, when clicked on, tracks the source of the traffic and ultimately provides the YouTuber with a portion of the sales they’ve generated. Affiliate marketing pros and cons include:

  • Pro: You can get free products — affiliate marketers often receive free products they’re asked to review.
  • Con: You need a crowd — if you don’t have a substantial following, it will be difficult to generate a significant number of sales.
  • Pro: You can bank on yourself — if you are a good salesman or saleswoman, you’ll be able to make money quickly through good affiliate link pitches.
  • Con: Affiliate links have low commissions — depending on the affiliate link, your commissions may be quite low. Target, for instance, only provides up to 8% on its affiliate commissions.


Corporate sponsorships are another great way to turn a YouTube channel into a moneymaker. While affiliate links and ad revenue can both vary depending on who clicks on your links or watches your videos, corporate sponsorships are a bit more predictable.

These consist of a company paying a YouTuber in order to be promoted on their channel. Instead of relying on making specific sales or reaching a certain number of views, a paid sponsorship is simply focused on providing exposure for a company through a YouTube Channel.

  • Pro: It provides a more stable income — a sponsorship is typically a more specific amount of money you can count on as it comes from an established company.
  • Con: A large audience is required — if you don’t have a rather large audience, it’s difficult to land a profitable sponsorship.
  • Pro: You can get free products and discounts — while affiliate links can be hit and miss, sponsorships typically come with free products and discounts to promote.
  • Con: It can look disingenuous — if you agree to a sponsorship, make sure your audience is okay with the decision or they may see the move as selling out on your message, which in turn can undermine your reach as an influencer.


Donations are another powerful line of revenue, although the conditions must be right for a YouTube influencer to survive off of this form of income. It’s a bit risky because asking your audience to support you with direct monetary gifts can have a number of negative repercussions that will quickly outweigh the positive elements.

  • Pro: No sharing of earnings is required — if you receive donations as a form of support for your channel, you don’t need to give either Google or a third party business a cut of the income.
  • Con: It’s a hard pitch — it’s difficult to get people to part with their hard-earned money unless they’re very passionate followers.
  • Pro: Some content is donation-prone — if you operate a channel for a nonprofit, for instance, asking for donations can be an easy way to capitalize on your efforts.
  • Con: It’s often a last-ditch effort — influencers typically ask for donations to keep the lights on, not as a way to find sustained YouTube success.


If you have a passionate following, one avenue for income is through selling merchandise inspired by your channel. Anything from buttons and pens to t-shirts, handbags, and countless other knick knacks can be created and sold in order to cover your costs. However, as with donations, this is a bit difficult to sustain.

  • Pro: Merch provides creative freedom — you’re able to have complete creative freedom without input from a sponsor or affiliate when designing merch for your audience.
  • Con: It requires a large audience — once again, this option kicks in and works out once you have a large enough fanbase to provide a steady stream of business.
  • Pro: There’s no need to share income — as with donations, merch allows you to keep all of the money you make in sales.
  • Con: Merch takes time — while ad revenue and affiliate marketing often run themselves, merch takes time to design, manufacture, and sell.

Tips for Starting a YouTube Channel

If you’re serious about entering the gig economy via YouTube, here are a few suggestions to help you get started earning money online.

Promote Your Channel

If you’re going to start your own YouTube channel, your goal should be to sustainably build your audience as quickly as possible. One of the ways to do this is to position yourself as an expert in your niche or on your particular subject.

Once you’ve found your message, begin to promote yourself by looking for other influencers and advertising avenues where you can showcase your knowledge. These opportunities live on YouTube, social media, or anywhere you can find a new audience that could grow your fanbase. If, for instance, you have a channel devoted to quirky science experiments, look for schools that might be interested in partnering with you.

Invest in Reliable Gear

If you’re serious about attracting an audience, invest in good recording equipment. Make sure you have high-quality versions of basic equipment such as a camera, tripod, ring light, and microphone.

If, for instance, you’re considering filming autonomous sensory meridian response (ASMR) videos, look into getting a Blue Yeti, 3Dio Free Space Pro II, or another comparable microphone to provide the crispest quality recording for your listeners.

Find Your Niche

Choosing your niche is a critical step in your YouTube journey. If you spend time and effort on a topic that is already saturated by a host of other YouTubers, you’ll be setting yourself up for failure. As you search for a niche, ask yourself a few questions.

  • Are you passionate about the topic you’re considering?
  • Is there a significant amount of interest in the topic? (You can use a tool like Google AdWords Keyword Planner to view keyword search volumes in your niche.)
  • How much competition is already in the space?

Take Time to Edit

Finally, always take the time to edit your videos carefully. Failing to finalize your videos with professional care can be as detrimental to your success as hurrying their scripting and production.

If a video comes across as sloppy or lackluster due to a failure to edit out mistakes, it will be more difficult to establish yourself as an authority within your niche. Consider utilizing tools like iMovie, Final Cut Pro X, Movie Maker Pro, or Adobe Premiere Rush to make sure your final product is as professional as possible.

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