The online video space has been become rather saturated in the past few years. With TikTok continuing to ride its exponential growth wave, and other platforms implementing TikTok-like feeds, there is still one platform that reigns king in the online video space.
According to Alphabet’s Q4 performance update, YouTube generated $8.6 billion in ad revenue in Q4 2021, while for the entire year, YouTube brought in $28.8 billion in advertising income.
As you can see in the image above, YouTube saw a significant jump from 2020 to 2021. About 55% of YouTube ad revenue went to creators, meaning YouTube paid creators more than $15 billion throughout the year of 2021.
YouTube’s Revenue Sharing Program
One of the main reasons that YouTube remains a clear leader in the online video space is thanks to its revenue-sharing program.
YouTube’s creator monetization model sees billions shared with creators each year, and no platform is close to matching it in terms of how sustainable the model has become.
Whether or not YouTube created the Revenue Sharing Program to sway creators away from TikTok is not exactly known, but it’s clear that offering more incentive, more opportunity and more rewards for efforts is working in convincing creators to make YouTube their creation platform of choice.
YouTube has been trying to stunt TikTok’s growth with its ‘Shorts’, which, according to Sundar Pichai, continues to gain momentum.
As said by Alphabet’s CEO, Sundar Pichai:
“YouTube Shorts continues to drive significant engagement. We just hit five trillion all time views, and have over fifteen billion views each day globally. This is helping our creator community reach newer and bigger audiences. In fact, more people are creating content on YouTube than ever before. Last year, the number of YouTube channels that made at least $10,000 in revenue was up more than 40% year over year. And we’re continuing to improve support for Artists and Creators.”
YouTube to Explore eCommerce
Due to the fact that short videos are too short to insert into mid-stream ads, TikTok has been forced to explore other alternatives. One of which is eCommerce; enabling creators to generate revenue by selling products that are tied to their clips. However, YouTube too is testing eCommerce functionality.
As per Pichai:
“We’re making it easier for viewers to buy what they see – and simpler for advertisers to drive action with innovative solutions like product feeds in Video Action Campaigns and emerging formats like live commerce. Backcountry.com generated a 12:1 return-on-ad-spend with product feeds in 2021 and plans to double its investment in 2022. While Samsung, Walmart, and Verizon partnered with creators to host shoppable holiday livestream events in the US”
