Saturday, August 6, 2016

YouTube Sponsorship: The Good, the Bad, and the UGLY

Ever wondered about the good, bad, and UGLY of sponsorship? Or how much you could make with your size of audience? Would you like some tips, or are you just curious? Michnus Olivier via Overland Junction wrote a solid article on sponsorship, and I thought I'd weigh in with my own tips and warnings for both Creators and Brands on my neglected blog.

While most of my content is produced for motorcycling enthusiasts, this article is written for anybody looking into sponsorship.

Now I'm not an internet millionaire or superstar,  but I have landed a fair share of paid sponsorship and make a living doing what I love, so I thought I'd weigh in on my experiences, tips, and a few fails. To lend a little credibility to the article (so you know I'm not blowing hot air as an "expert" that actually doesn't have an audience) I make a full-time living on Social Media. I've currently got a modest 50,000 YouTube Subscribers, 10,000 Facebook Likes, and close to 10,000 Instagram followers. This is in a very niche genre: Dual Sport Motorcycling (I'm not bothered if you've never heard of it. But now that you have, you should give it a try!)

Sponsorship is a market just like any other. Creators and personalities sell promotion via video, post, or picture to companies who want to reach the creator's audience.

Here's a scenario we all know: selling motorcycles (or cars). Say a guy is selling his bike for $2500. If you know his bike is only worth $200, you know it's a waste of money. If you know it's worth $3000, then it's a decent deal.

The difference between the motorcycle market and the sponsor market is that in the sponsor market, neither the buyer or seller really knows how much the content is worth. This article, with some very useful links, will clarify that.

This post was inspired by Michnus Olivier via Overland Junction, who writes up a good article about the pros and cons of ADV Motorcycle sponsorship.If you've ever considered sponsorship or marketing your brand through sponsorship, Michnus' article is a rock-solid read from the perspective of a guy who has not only been sponsored, but owns a brand.

In my own experience, sponsorship has been mostly positive, but there have been more than a few awkward moments, and a few lemons. I've also dropped the ball with several sponsors, and am most likely labeled as either a "Prima Donna" or a Pariah to some companies. I ignore companies that I feel are overpriced and review things with brutal honesty, which I think scares some brands. I've had to say, "No thanks." to companies after testing products and finding them inadequate (which is super awkward, especially when they kindly sent those products to me for free.) I've been hard to get a hold of because of my issues with phones, and my inbox is continually flooded (1411 unread messages at the moment) so it's easy to miss important communications. Managing social media sponsorship is hard work! Balancing the inbox, negotiating deals, and making sure you both get what you're looking for can be a nightmare. So here are some of my thoughts to make the process easier for all parties.

Remember, sponsorship is an economy of its own. The first rule of economics: THERE IS NO SUCH THING AS A FREE LUNCH. Creators, if you want "free" things, prepared to WORK for those "free" things. Companies, if you want "free" marketing, prepare to compensate for that "free" marketing.

FIRST, A FEW TIPS FOR CREATORS LOOKING FOR SPONSORSHIP:

First, you NEED to know your stats! I know it sucks, but take a look at your YouTube and Facebook analytics. Find out your reach and make an honest assessment of whether your content is reaching enough interested people to make it worth a sponsor's time. I hear complaints from sponsors ALL THE TIME that they are continually inundated with emails from "every guy with a bike and a YouTube channel/Instagram feed."

THIS IS IMPORTANT: There are folks out there who spend more time trying to get sponsorships than they do creating the actual content that would benefit the sponsors. The old saying is true, "If you build it, they will come!" Spend time on your CONTENT. Make your videos/pictures/posts the best they can be, and the audience will come. When the audience comes, then it's time to go for sponsors, NOT BEFORE. And even when you do build up an audience, get used to plenty of rejection and low-ball offers.

If you feel like you've built up a good sized audience, sign up for SocialBlueBook.com and Klout.com. These will give you a good idea as to how much you can ask for when going for a sponsorship. In my experience, they seem to suggest that a YouTube video DEDICATED to the product is worth about ten cents per view, and will base that number on your average views across your entire channel. 

This means that if you average 1000 views per video, a video from you is worth about $100. You need to calculate the time it will take to make that video. Simple math: If it takes you just 10 hours, that's $10 per hour, but don't forget to count filming, editing, writing, uploading/tagging, thumbnail image, title research, and then responding to comments in that 10 hours. You'll have to decide whether it's worth your time or not to make a full-fledged video for a "free" bit of gear worth $100. You also need to determine if your audience would even be receptive to it. Think about your cost and time. If you could work for 5 hours at your job and buy the same bit of gear without the hassles of sponsorship, that's a better route. Your audience will also get a more realistic look at the product, if you decide to make a video about it at all.

This is going to sound harsh, but I say it with love. If you don't have at least 5000 subscribers, it's probably not worth your time, or the sponsor's time, to even ask for a $100 freebie. To command the $100 that video may be worth from a sponsor, you need about 5000 subscribers with a 20% subscriber watch rate per video, which is 1000 views per video.

Quiz time! Here are three different scenarios:

1. If a channel focuses ONLY on Dual Sport Moto and has 50,000 subscribers, with an average of 10,000 views per video, what's a sponsored video on that channel worth?

2. If a dual-sport-centered channel has 120,000 subscribers and averages 5,000 views per video, what's a sponsored video worth on that channel?

3. If a channel that only occasionally has motorcycling content has 500,000 subscribers and averages 20,000 views per video, what's a moto-sponsored video worth on that channel?

Answer 1: 10,000 views = $1000 per video.

Answer 2: 5,000 average views (no matter how many subscribers) = $500 per video.

Answer 3: This is a toss-up. Much of the audience may not be there for motorcycling content, so even if they have an average of 20,000 views, you don't know how many of those views are potential customers. In this case, I'd look at their last 10 motorcycle-related videos and average the views, then base my offer on that amount.

So it's most important to focus on content before all else when starting out. Also, if you tend to make the same type of video over and over without experiencing much growth, don't expect it to grow massively down the road. You have to change, adapt, and keep making better content. I also hate to say this because I love me some motovloggin', but standard life-event motovlogs rarely cut it, and being a "MotoVlogger" myself has shot me in the foot. You either need to be vlogging about important topics, pushing the videography envelope, going to unique places, or kicking in some mirrors/punching people/getting chased by cops to make it big.

That being said, some people seem to sell their souls to "make it" on YouTube or social media. Be yourself, even if you're a boring prude like me. Remember, most sponsors don't want to be associated with violence, intolerance, crime, or hate. You need to be careful what you say about politics, religion, and the kinds of things you "like" with your Instagram and Facebook accounts. I know it sucks, but you've gotta be a little PC. While fighting or running from cops may get a lot of views, it won't attract sponsors. You also need to consider the audience it brings in (because the sponsor is thinking the same thing)... but that's a topic for another article.

While pitching for a sponsorship, create a "media kit." Gather all of your numbers (subscribers, follows, likes, views, comments, etc.) Go through your YouTube and Facebook analytics and gather as much information about your audience as you can: Age, location, gender, etc. Then summarize that information in an easy-to-read format. Include your Klout score and a screenshot of your Social Bluebook values.

Like Michnus' article says, if you work out a deal and get something for "free", FOLLOW THROUGH and promote them! Never stiff a sponsor. It looks bad for all of us. However, sometimes projects (especially long-term reviews) take time to finish. I hope my good friends at Sena Bluetooth and Green Chile Adventure Gear know that I'm still on the job to give the Sena 10S and Hardcore Soft(ish) rack in-depth reviews. (So far they're awesome, BTW!)

Oddly enough, I'm in a niche saturated by people who take very interesting adventures and ride motorcycles around the world. I've only crossed the Canadian and Mexican borders, so an international adventure rider I am not.

However, weekend moto warfare has left time to dedicate to social media, editing, and sometimes even my family. This has paid huge dividends! Now I say this for factual and inspirational sake, and not to toot my own horn, but this method has netted me a Klout score of 78, which ranks eveRide Media in the top .01% of all moto social media content online, and good numbers at socialbluebook.com, which suggests price points for sponsored posts across social media platforms. Also, my kids and wife actually know who I am! ;) You can see my Klout and Social Bluebook stats in the images below.




Adventure riders who want a large audience have an uphill battle, because they have to ride (which is awesome, but takes a ton of time), film, shoot, edit, and then manage social media (which also takes a ton of time, but has to be done to grow.) Doing all of that is incredibly difficult... and trust me, all that other "stuff" can suck the fun out of long-distance adventure riding really fast. 

If you're on social media and looking for sponsorship, you should DEFINITELY use Social Blue Book to find out what your posts are worth. When approaching or responding to a potential sponsor, a simple screenshot of Social Bluebook's calculations set a solid baseline for negotiation. It's also based on real numbers and algorithms, audience reach, and audience engagement (which, as mentioned before, is far more important than reach). It's also FREE! You can see my Social Bluebook stats in the image below.


You might see that and think, "Holy crap! $1,158 per video!" But remember, you have to calculate your own costs and your own time to produce those videos, and as I'll point out below, the margins ain't good.

Now as you can see, the money from a sponsored video listed on a modest 50k channel isn't going to make anybody rich. While doable, sponsorships are still hard to land, and can take months of collaboration and work to create a media package that both the creator and sponsor enjoy. Full disclosure: I only land about one sponsored package totaling from $1000 to $2200 every 1-3 months, and truthfully they're so much work, I'm not actively pursuing many more than that. I currently work consistently with just one sponsor, and that's been great. In an ongoing partnership, most of the introduction work is done and we can get down to business quicker. That's a great example of why you want to do your best work for brands you know, love, and who offer fair contracts right out of the gate.

In my most recent developments, the epic and immensely generous fans who contribute to my channel via my Patreon page are collectively contributing nearly $1100 for a video if it's NOT sponsored. I'm still in shock over their generosity and trying to wrap my head around that. I'd write an article of "How to do great on Patreon" but I honestly don't know why they're so generous. All I can say is that it probably all goes back to content. If you put your focus on creating great content, good things will happen.

In summary, to pitch to sponsors:

-Gather stats
-Analyze stats
-Organize stats
-Present stats
-Try not to die of boredom with all the frickin' stats

So what happens when you finally get the sponsorship? !!!THIS IS IMPORTANT!!!

Make a VERY CLEAR OUTLINE OF EXACTLY WHAT YOU ARE PROVIDING, and exactly what you are getting paid. Be very clear on how many edits/changes the final product can have, and how much control of the project the sponsor has. Trust me, get this wrong and it's a living hell... and you might spend a hundred hours and never see a dime because the sponsor bails on the contract. (In which case you'd pull the video, but you'd still be out all those hours.)

Do it in bullet format, and leave out the pleasantries. Here's an example:

Promotional Agreement Between eveRide Media and Fishsticks Motorcycle Knobs

This promotional package includes:
  • One video review
    • Video will be released in approximately two months after a thorough testing period.
    • If eveRide Media can't honestly recommend the product, no video will be made and the product will be returned, shipping paid 50-50 by both parties.
    • eveRide Media will answer all relevant comments for 24 hours after the video's release
    • Fishsticks will be able to preview and edit the script of the video ONE time before the video is made. No other edits can be made after the initial script editing.
  • Three instagram posts featuring Fishsticks Motorcycle Knobs
    • Fishsticks will not be allowed to edit or modify these posts.
  • Three Facebook Posts featuring Fishsticks Motorcycle Knobs
    • Fishsticks will not be allowed to edit or modify these posts.
  • Three Twitter posts featuring Fishsticks Motorcycle Knobs
    • Fishsticks will not be allowed to edit or modify these posts.
  • eveRide Media retains the right to monetize, publish, delete, or remove the video, pictures, or posts at any time for any reason.
  • eveRide Media will retain ownership and creative control over all media and content in this package.

Basically the point of making everything VERY clear is so you don't have a company trying to take control of your video and write the review for you. If you are not clear, you could be stuck in an endless loop of, "I expected this! I won't pay until you change this!" and never get paid for your work. I know it sounds rough, but basically you need an agreement that says, "Your company gives me 100% creative control over this video, and will pay me the full amount regardless of the length, content, or wording of the video."

It may also be a good idea to get a percentage up front, so they're invested in getting the project done as well. Some brands have a knack for holding your money hostage until the content you created is exactly (word for word) what they want. If you have to bail on a project because the brand is inflexible, you'll be out perhaps hundreds of hours and they'll be out... nothing.

That may look like a tough pill for a brand to swallow. However, with a few great example videos under your belt and a more friendly explanation of why the wording in the agreement has to be so rigid, they'll understand. They need to trust you to make a great video for them, and you need to deliver that great video if you want a working relationship in the future. It just works best if the brands let the creator be 100% in charge. A few edits in the script are okay, but other than that, I'd recommend telling them, "hands-off!" Videos are just too hard to edit, and no creator wants to be micro-managed or waste their time. What could start off at $20-30 per hour can quickly turn into pennies per hour if you allow yourself to be micro-managed by the brand.... and worst-case scenario you waste your time creating content, never get paid, and nobody benefits.

So we've gone through the good and bad... now it's time for the UGLY.

So as you can see, there is an enormous amount of work to be done if you want to land sponsorship. There is, first, a focus on creating great content. Then there's a massive amount of audience development through consistent posts, responses to messages and comments, and engagement in the community. Then (if your audience grows) you can pitch to sponsors. There is a huge amount of communication and collaboration with sponsors to make sure they're happy, and then... after all that... you can make money via sponsorship. Keep in mind, you don't get paid to do any of this before hand.

But keep in mind, even at $1000 or more per video, it's still a gargantuan amount of work to coordinate, plan, and execute a marketing package, not to mention the writing, filming, editing, meta, and comments. To calculate it down I'm still only making about $10 per hour per sponsored video. For a brand, when it comes to employing an entire video production crew, or even hiring out to freelance videos, $10 per hour of video production to reach 75,000 dual sport fanatics is a hell of a deal.

In the scope of things, that $1,158 per video from Social Bluebook is really pathetically low considering the amount of work it takes (and all the years without pay that it took to build the audience) versus creating a video in-house, or hiring a video crew, or building/reaching your own audience. If I were a brand, I'd be sponsoring YouTubers left and right and aggressively making pitches through Social Bluebook... because seriously, YouTubers are way cheaper than outsourcing video production, and they've got an audience built in!!! They'll even handle the customer service and questions on the video!!

NOW SOME TIPS FOR BRANDS TO OFFER FAIR DEALS AND GET THE MOST OUT OF THEIR MARKETING MONEY:

First of all, brands should think in terms of cost per view. Calculate the cost of the item you're giving away (and/or the cash payout of a paid sponsorship) and divide that by the average views/reach the content creator gets per video, picture, or post. Compare that to running an ad on Google, Facebook, or elsewhere. 

Remember that Google Adsense, Facebook Ads, etc will charge a fixed rate per impression, click, or view, and stop the ad once your budget has been used up. With a sponsored blog post or YouTube video, once it's up, it's up (and searchable) forever. That means that with each view, your cost per view actually goes down. A good promoter will make sponsored content valuable and entertaining, something that people will actually WANT to search for and watch, not a force-fed advertisement.

When a creator makes an offer, or you're seeking a creator, ask for their Klout score and a screenshot of their Social Bluebook stats. Ask about their basic audience numbers (subscribers, likes, follows, etc) and then go look at their recent posts. Request to see their audience retention numbers. Plenty of YouTubers can write clickbait titles, throw some cleavage on the thumbnail image, and get a million views, but everybody leaves after the first five seconds. Audience retention rates are absolutely important to make sure your content is actually being seen, not just clicked in and out of. When looking at their content, see what kind of feedback they're getting, and what kinds of comments are being made. This is CRITICAL. If they don't want to show you those statistics, they may be hiding something.

Brands MUST to do their homework on creators. Sending $1500 worth of gear to an outlet with only 100 total followers and a reach of 10 people is a obviously a poor investment. But sending money/gear to what looks like a huge audience could be just as bad! That's why you have to look at audience engagement.

Sponsors should avoid working with pages with tons of subscribers/followers/likes that have very low engagement, views, comments, likes, etc per post. On a given post, video, or picture, anything less than 1% engagement can indicate that the audience was either paid for and not real (https://youtu.be/oVfHeWTKjag) or that the audience was grown using media that had nothing to do with your product. Or, worse yet, that the audience just isn't engaged with the creator. On a typical Facebook post, an average post typically "reaches" about 20% of the total Facebook "Likes" for that page, and gets engagement from about 1-5%.

I know 1% sounds very low, but it's actually rock-solid. (This is because Facebook makes you pay to reach your entire audience, even though they're already interested in your content.) If a Facebook page has 10,000 likes and can constantly get 100+ likes per post, the engagement is considered quite good. If a page has about 100,000 likes and can only snag around 100 likes and one-or-two comments per post, there is a big, BIG problem. 1% is vastly better than .01%.

Sponsors should also be wary of pages that build their audiences with no original content, but rather rely solely on the content of others (for example, YouTube channels that steal and compile other channels' content, or Instagram accounts that only "repost" the best pictures from other accounts.)

Wise brands look into the cost/benefit of their advertising. Some sponsors will pay big bucks to put up a banner at a local racing event that maybe 200 people will see. (Props to the sponsor, though, for supporting a local event!) Yet the same sponsor won't consider the same cost for a social media campaign that would reach far more people. Some sponsors have no problem shelling out huge amounts to get into a print magazine, but never consider the magazine's reach or the longevity of the ad in print.

Social media utterly crushes traditional print and banners in cost-effectiveness, and it's actually measurable! I'm sorry, but print magazines just don't reach the audiences that social media and keywords can. Print is expensive, requires a team of personnel so ad prices are higher, and print media takes a long time to distribute, while a digital article (like this) will reach thousands the moment I press "Submit", and be available for search indefinitely. Print ads also can't measure how effective advertisements are. How many people actually saw the ad? Who acted on them? Who made a purchase from those ads? Print is based on paid subscriptions from people who are already familiar to the genre, but what about new riders? It's unlikely that somebody who's brand new to Dual Sport or ADV would pay for a magazine subscription before checking Google, YouTube, or forums.

IMO digital media is a much better investment. Here's a real life example:

Lonny at klrdash wanted me to promote a few products for him. For a budget of $1000, he received a promo video, an instructional install video, several Facebook posts, and several Instagram posts. He sold out of the promoted products (and made back his initial $1000 investment through trackable links) on the day the first video was released. He has reached 25,000 interested people so far (who were searching for products related to the KLR Dash on Google and YouTube), and those videos will continue to reach people who search, because the keyword will never be thrown in the trash or left gathering dust by the side of the toilet. People search for the video, not the other way around. 

So without calculating additional exposure from Instagram posts, Facebook posts, or additional videos that his products have appeared in, Lonny paid roughly four cents per view, and that price continues to drop as the videos continue to get more views. Not only that, but he can track exactly where the traffic comes from through tagged links. My awesome friends at Rocky Mountain ATVMC have experienced similar stories, and I'm stoked that they're happy enough to continue working with me even though I'm a total wuss. (See "ADVersity ;) )

Even though I spent around 100 hours on the entire KLR Dash project, (effectively making about $10 per hour) Lonny's investment was a great deal for me and was my first paid "sponsorship" experience. It was obviously a great deal for him! Four cents per view to an engaged, searching, interested, moto-centric audience is a phenomenal deal! (Far less than Google adsense, Facebook, or direct mail for sure!) 

Companies should also understand that not every sponsorship opportunity is equal. Just like a contractor taking bids for building a home, a creator has limited time for making videos, and can't take a low offer seriously when they have other bids for ten times as much, and that competition can include fan-funded videos.

Let's say you're selling your bike for $2700 and entertaining offers for $2500. Suddenly you got an email offer to trade that bike for a $50 pair of used boots. Would you even take the time to reply?

The same goes for sponsorship and paid content creation. When making sponsorship proposals to creators, remember that about ten cents per average view is what it will take to be in the ballpark, and that's for a dedicated video upload. A far lower offer is a slap in the face, and much more is a waste of your company's cash.

Thanks for reading, and good luck!

eveRide out.

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