In February 2023, YouTube announced the monetization of YouTube Shorts with a new ad revenue-sharing program. Shorts has been called YouTube’s answer to short-form content platforms like TikTok and Instagram Reels, and monetizing Shorts was a huge step forward. Brands and experts alike all speculated on the impact this would have on the creator economy as a whole.
Many wondered whether monetizing YouTube Shorts would lure content creators away from other short-form video platforms like TikTok and Instagram. In this article, we’ll take a look back at YouTube Shorts’ first year of monetization and discuss whether it’s really worth it for creators before diving into how creators can successfully use Shorts to grow their audience and revenue.
What We’ve Learned Since YouTube Shorts Monetized
The biggest takeaway of YouTube Shorts’ new revenue-sharing is that while you can definitely make money with YouTube Shorts, it pales in comparison to what you’d make doing long-form content on the platform – and it’s not even close.
However, the monetization of YouTube Shorts has been a success because many of the issues monetizing short-form content on the platform aren’t specific to YouTube Shorts — they apply to short-form content in general. Ultimately, success is dependent on the creator, their goals, and how they utilize short-form content.
Understanding YouTube Shorts vs. Long-Form Content Revenue
This year, one of Viral Nation Talent’s creators earned as much as 21x more per view from their regular, long-form content on YouTube than they did on Shorts.
To get a better understanding of the costs and revenue when it comes to Shorts vs. long-form videos, let’s explore two of the most important metrics on YouTube – cost per mille (CPM) and revenue per mille (RPM).
Cost per mille (CPM): The Metric for Brands and Advertisers
CPM is an acronym for “cost per mille” and it’s an advertiser and brand-centric metric that represents the cost for every 1,000 impressions an ad gets. If a content creator has a high CPM, it means that brands and advertisers are willing to pay a premium to have their ads placed on that particular creator’s content.
Creators can look at niches with high CPMs to get an idea of the topics that brands are willing to spend more on, which can inspire future content efforts. For example, the search term “making money online” has one of the higher CPM rates – it averages $13.52 – so it has potential for creators looking for topics and ideas.
Now, let’s work with some real data!
Take one of Viral Nation’s very own creators as an example. For the sake of this exercise, we will keep them anonymous, but they’re what’s considered a ‘mega influencer’ on YouTube, boasting millions of subscribers, and they’ve been well-known on the platform for many years.
This mega influencer, whose content typically ranges from 3-5 minutes in duration*, has the following CPMs:
- CPM for Shorts: $0.10
- CPM for long-form video: $1.57
*Note that content typically under 8 minutes is not eligible for mid-roll ads (mid-roll ads increase RPM because multiple ads are watched per view, and eligibility starts at 8 minutes).
What this means is that if a brand placed ads on a Short, and that ad got 3 million impressions, it would cost $300. But if a long-form video got the same number of impressions, it would cost $4,710.
One thing to keep in mind about CPM is that it shows earnings before revenue sharing (i.e. it’s before YouTube takes its cut).
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Revenue per mille (RPM): The Creator-Centric Metric
RPM, or “revenue per mille”, is a creator-centric metric of how much revenue the creator generated for every 1,000 views, which means RPM has a direct impact on a creator’s earnings.
RPM is one of the single most important metrics to creators because it shows them what they’re actually making at the end of the day. On average, RPM for Shorts is between $0.05 and $0.07, but let’s take a look at our creator’s RPM for a real-life example:
- RPM for Shorts: $0.06
- RPM for long-form video: $1.27
Comparing the RPMs, we can see our creator makes 21x more from their regular YouTube content than they do from Shorts. For example, if a creator produces a Short that hits 3 million views, the creator makes $180. But if 3 million people viewed one of their long-form videos, the creator gets $3,810.
Remember earlier when we discussed how CPM shows earnings before revenue sharing? Well, RPM shows the revenue after revenue sharing, and this is the reason why you’ll often see CPM values that are higher than RPM.
But another important note is that YouTube’s fees are different for long-form video and Shorts as well. For long-form video, YouTube takes a 45% revenue share whereas for Shorts, YouTube takes a 55% share. This difference is largely because the monetization model for short-form content is more complex.
YouTube is Still the Place to be for That Sweet Ad Money
Regardless of the reduction in potential revenue for Shorts, YouTube is still the place to be for creators looking to monetize their content, as the platform boasts one significant advantage over its competitors – it uses Google Adsense to display ads (Google acquired YouTube back in 2006) while the other platforms do not. While it is not the sole reason, the utilization of Google Adsense is a big reason why YouTube is still the most reliable monetization platform for creators.
In fact, both TikTok and Instagram Reels offer very little in terms of native ad support, though TikTok is working to combat this with its Spark ads feature.) For creators counting on ad revenue as their primary source of income, YouTube still rules the roost, whether you’re making Shorts or not.
Short-form content is harder to monetize
Some would argue that the revenue from short-form content doesn’t offer enough juice to justify the squeeze, at least for creators who rely on ad revenue. It’s indisputable that monetizing short-form content is more complex than long-form video, but this isn’t an issue that’s unique to Shorts. In fact, we’ve seen it on TikTok and Instagram, too.
Effectively serving ads on short-form videos often relies on users binging multiple videos (or infinitely scrolling) during a single session so the promotions can be served in between the videos. Conversely, traditional YouTube videos will often have an ad at the beginning and end of the video, in addition to mid-roll ads if the video is long enough to support them (typically applicable to videos eight minutes or longer).
But the monetization model for Shorts displays its flaws if you’re like most people who constantly DM your friends with memes and funny posts. For many people, sending memes is a love language, but it’s a huge challenge when monetizing short-form content because when you send that Short or TikTok as a DM, it appears in isolation. Since your friend or family member was not scrolling on the platform, it means advertisers literally have nowhere to place their ads because users are unlikely to sit through an ad that could be longer than the video itself.
This is where mid-roll ads come into play, and they give long-form content an additional advantage over Shorts. For YouTube videos that are at least 8 minutes long, mid-roll ads are another option to further monetize your content. As the name implies, mid-rolls can be served throughout the video, so the longer the video is, the more mid-rolls you can place in it.
While mid-rolls present a bevy of advertising opportunities in every video, creators should be mindful that they don’t overdo their mid-roll ads to the point where they annoy viewers and drive them away. We’ve even seen cases where a YouTuber was doing an ad break to promote their video’s sponsor, only to have the sponsored message get interrupted by a mid-roll ad! Creators utilizing manual mid-roll placements should consider the viewing experience into consideration and try to avoid situations like these if possible.
When in doubt, keep in mind that YouTube considers a variety of factors to determine if it’s appropriate to show a mid-roll ad where the creator has manually inserted one. In fact, YouTube even offers an automated version that will take care of the mid-rolls for you. But as a general rule of thumb, creators should aim to space out their mid-roll ads to once every 3-5 minutes of run time.
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5 Best Ways to Use YouTube Shorts Post-Monetization
Even if the money isn’t there yet for Shorts, it’s not something that creators should write off. While many creators were already employing the following tactics prior to monetization, now that Shorts are monetized, the use case for Shorts has never been better.
1. Build and Grow Your Audience with Shorts
There’s something about short-form content that just immediately captures our attention. It’s also the content format that gets some of the highest engagement, whether it’s likes, shares, or comments. With content that is so inherently sharable, Shorts are an effective way to build or grow an audience. It can even introduce creators to completely new audiences, especially the younger TikTok generation.
Let’s be honest, watching a 60-second Short is a much easier “ask” than a 20-minute video essay, and if a viewer likes a Short enough to check out more of the creator’s content, this action has the potential to turn that viewer into a subscriber who would’ve never interacted with that creator otherwise.
2. Use Shorts as a Hook for Your Long-Form Content
Creators can use Shorts as intro ads to encourage viewers to watch their long-form content. Typically, this process involves the creator giving a quick intro and rundown of the topic or idea before ending on a cliffhanger that leaves the audience wanting more.
A great example of this one-two punch comes from creator Caleb Simpson. He made a Short about a guy who lives in New York but pays zero rent. You’re probably wondering how that’s possible – and it’s because he lives in an ambulance (no typo). The premise alone immediately brings a flood of questions to mind, and Caleb even asks a few of them in the Short before encouraging viewers to watch the full video on his YouTube channel for answers.
When using a Short as an ad, it’s imperative to structure it so that viewers are motivated to watch it until the very end, and Caleb’s Short is a great example of how to do that. In Caleb’s long-form video below, which is almost 10 minutes long, you get a tour of the ambulance home on wheels and learn a bit more about the guy who lives in it rent-free.
YouTube has also recognized the potential of using Shorts as hooks for longer content and has made it even easier to do with its “Related Links” feature, which allows creators to link Shorts to traditional YouTube videos (such as the one you’re promoting). But it doesn’t end there – creators can also link to live streams, podcasts, products, and even other Shorts.
Time and time again, we’ve seen creators successfully leverage Shorts to fuel the growth of their long-form content because Shorts helped them build trust with their audience and primed them for their longer-form content. And now that Shorts is monetized, this strategy gives creators a secondary form of revenue as they make ad money not only off Shorts, but also the long-form video it links to.
3. Repurpose Content From Other Platforms
For creators already accustomed to making short-form content for Reels and TikTok, it’s relatively easy to repurpose those videos and turn them into Shorts. And as mentioned above, this is another potential income stream for creators.
Creators can also leverage insights from their TikTok and Instagram analytics in their content strategy for YouTube. The data from TikTok analytics is especially helpful because TikTok has a huge range of niches and sub-niches that don’t exist on YouTube. TikTok can be a great way for creators to gather data on audience preferences to find new content opportunities on YouTube.
While it’s relatively easy to translate a Short into a TikTok or Instagram Reel and vice versa, creators should be aware of the different runtimes for the platforms. Generally, TikToks range from 15 seconds to 3 minutes, but some TikToks can be as long as 10 minutes! Meanwhile, Shorts can run as long as 3 minutes, while Instagram Reels can be up to 90 seconds in duration.
4. Rapidly Test Content Ideas and Pick the Best Ones
Shorts are an excellent way to test new content ideas for viability before putting in hours (or sometimes months) of work on a long-form video. Creating a Short on a potential topic and then analyzing the results removes some of the guesswork for creators when making long-form video content.
Using Shorts in this fashion gives creators a greater sense of certainty that the hours they invest into a long-form video will be worth it.
5. Use Shorts as a Stepping Stone to Increased Revenue via Long-Form Content
Shorts are a great way for short-form creators who primarily use TikTok to branch out to YouTube and begin making some real ad money through long-form content.
Generally, creators on TikTok and Instagram make the majority of their money not through platform revenue, but rather through brand deals and merchandise -and it’s not even close. Typically, short-form creators on those platforms make up to 65-70% of their income from brand deals, with platform revenue accounting for only 30-35% of their earnings.
Many creators eyeing a move to YouTube are doing so because YouTube’s ad revenue model offers a consistent and predictable income stream that also generates passive income as the video continues to accumulate more views over time (especially if it’s evergreen). YouTube also allows for greater creative control, as brand deals usually involve following a brand-approved script on a one-off collaboration with a one-time payout.
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Beware Of Copyright Issues When Repurposing Content
When a creator repurposes their content between platforms, such as taking a TikTok post and turning it into a Short, they should be aware of potential copyright issues if they used someone else’s music or sounds.
Often, creators will tag the owner of the original sound or song if they use it in their own content, and it works similarly on both TikTok and Instagram. It’s an easy way for creators to not only give credit where it’s due, but it also helps creators avoid getting their content stricken (or even removed from the platform due to copyright infringement claims.
For example, let’s say that a creator is turning one of their TikTok posts into a Short, andthat the creator wants some background music in that TikTok. They choose Doja Cat’s “Paint The Town Red” – probably one of the biggest songs on TikTok in 2023.
If the creator didn’t save the original video (i.e. the version without Doja’s song on it), then the only version of the video they’d have is the TikTok post with the copyrighted music on it. This is the reason you’ll sometimes see posts that use a song from huge artists like Taylor Swift, Adele, or Doja Cat, only to have the music credited as ‘original audio’ from the creator themselves.
While this may not seem like a big deal, it could potentially get the creator flagged for copyright infringement, which can affect the monetization of their channel. We can expect this issue to continue to evolve after Universal Music Group pulled its artists’ music from TikTok before recently finalizing a new licensing agreement with the platform.
Opportunity Costs and Burnout
While we often recommend that creators diversify across platforms as much as possible, there are also opportunity costs to consider. Oftentimes, creators are hesitant to branch out because that means not only getting outside of their comfort zone, but also moving away from their primary form of monetization.
It can be both intimidating and nerve-wracking to try a new platform or different form of content, and it can be challenging for creators to ramp up and scale while still maintaining the quality of content their audience has come to expect from them. This holds especially true for smaller content creators who are one-person shows, but for more established channels with a team of people, it may not be as difficult.
There’s only so many hours in a day, and if creators are already feeling stretched thin, pursuing a new content format could lead to burnout or feeling overwhelmed. Creators should keep this in mind when deciding on how to scale their efforts across multiple platforms.
Why Brands Are Struggling to Monetize YouTube Shorts Effectively
Brands are still in the process of figuring out how to best monetize Shorts, and some brands are even hesitant to advertise on Shorts at all. Many organizations are still relying on the playbook they developed for sponsored long-form content, and we’ve seen that when applied to Shorts, it isn’t always a perfect fit.
For long-form content, brands typically give creators a script, and will often require the creator to say certain things or feature their product within the first few seconds of the video. But that doesn’t necessarily translate well to a 60-second Short. If a sponsored message is the first thing someone sees in a Short, it often affects the viewer’s trust while also killing the overall vibe of the content before it even starts.
When it comes to short-form content, brands should aim to give the creator more freedom in how they integrate the product or service into their content. The video below is a great example of this:
Notice how the creator tells you what an ice screw is before asking an intriguing question (i.e. Will this ice screw hold my weight?). Then, the video shows the creator placing the ice screw in a wall of ice, which further builds anticipation of whether it will hold him or not. And then, right before the climax where he actually tests the ice screw – that’s when he inserts the sponsored message.
It’s a similar thought process to the one applied by the hit TV show American Idol, where they go to a commercial right before showing the judge’s reaction. The concept? Get the audience to stick around through the sponsored message.
If the YouTuber from our example above treated it the same as a long-form video sponsor and did the promotion at the beginning of the video, most people wouldn’t have stayed until the end and it would’ve likely hindered the success of the video.
This underlines the importance of integrating sponsors naturally into your content, which also means brands have to trust creators to work their product or service into the content in the way they know best.
Generate Real Revenue from YouTube Shorts with Viral Nation
Is your brand ready to make its mark in the short-form content world? At Viral Nation, we specialize in connecting brands with top creators and leveraging the power of short-form platforms like YouTube Shorts. Whether you’re a creator looking to maximize your earnings or a brand aiming to reach a broader audience through innovative content strategies, we can help. Let’s transform your YouTube Shorts into real revenue—reach out to Viral Nation today and unlock your potential!
