How Much to Charge for a Video Sponsorship
Cash. Dinero. Moolah. Dolla dolla bills yo!
Money — it’s why you’re a member of the Grapevine Community. You’ve started a channel on YouTube and are at a point where you have enough traction to take things to the next level: the world of brand sponsorships.
Firstly, give yourself a big pat on the back. While anyone can start a YouTube channel, it’s really hard to get your first 1,000 subscribers. That’s a huge feat in and of itself. Congrats!
Brand sponsorships can mean a lot of things. Extra money to invest into your channel and the chance to not only do what you love, but make a living off of it too. But before you start daydreaming of making it rain with all the money you’ll be bringing in, you’ve got to figure out how much to charge for a video sponsorship.
It’s tough to price your personal time and effort, we get it. The question of how much to charge for a video sponsorship is one of the most common ones we hear. You want brands to value the time and effort you put into each of your videos, but also offer a price that’s competitive enough to beat the competition and get booked on the campaigns you want. It’s a tough balance, but luckily we’ve come up with a formula that works pretty darn well. Let’s get to it!
Our Tips for Determining How Much to Charge for a Video Sponsorship
Step 1: Figure out your Average Video Views
We look at video views instead of total subscribers because it’s a better indicator of how many people will see a product that’s featured in your videos. As a creator, your goal should not only be to grow your channel’s subscribers, but also grow the engagement, or number of people who are watching, liking and commenting, on them as well. Brands love creators who have high engagement stats so you should always be thinking about maximizing the amount of eyeballs on your videos.
Take a look at the last 10 videos you’ve uploaded and average the amount of views the videos have received. Be honest with yourself. If you have a video that went viral and is really outside of the norm (like over 2x higher than most of your other videos videos), don’t use it to calculate your video pricing. Keeping stats that aren’t representative of your typical channel metrics will set expectations at a level you may not be able to achieve. This can hinder relationships with brands, and make it harder to strike up lasting relationships. It’s way better to set an achievable bar and blow your brand partners out of the water, than vice versa.
Here’s an example of a creator’s last 10 videos. You’ll see there’s one that received significantly more views than the others (video #2), but it’s still within 2x of their other best performers. In this case, the creator can leave video #2 in the mix. If the video views were 20K or higher, we would recommend they use a different video that’s more in line with typical channel performance:
This creator has generated over 75K total views on their past 10 videos. On average, brands can expect this creator to have about 7,575 views on their future videos.
Step 2: Determine your CPM
CPM = Cost Per Thousand Impressions. Basically, it’s the cost for every 1,000 people who watch your video. This is a standard metric that most people use in the YouTube world.
At Grapevine, we recommend a CPM of $20 — $30. This is a price that is not only fair for creators, but also one that typically aligns with brand expectations. Remember, most partnerships also provide complimentary products, so the flat fee we’re calculating here is icing on top of the cake!
Step 3: Calculate your Video Price
Once you have your average video views and have determined the CPM you’ll charge for your videos, you can calculate what your video price should be. Here’s the formula you’ll need to use:
Going back to the example above, let’s use the 7,575 average view count and a CPM of $20. Here’s how we would calculate the video price for this creator:
In this example, the creator’s recommended video price is $151.49 (we recommend rounding down to a whole number — so $150). It’s as easy as that!
Math not really your thing? No problem — we’ve created this downloadable Excel template that will help you determine how much to charge for video sponsorships. Plug in your video views, select your CPM and voila, we’ll tell you what we recommend for pricing. Remember, this is only a suggestion and you never know what brands will accept or deny. But, it should give you a good idea of how to competitively price your videos.
Now you’ve got this figured out — the sponsorships await! Get going and head to the marketplace and start applying for campaigns. Good luck out there!
Originally published at blog.grapevinelogic.com on April 27, 2016.