Factors brands consider when sponsoring YouTubers

Brands spend a ton of money on YouTube influencer marketing — the Influencer Marketing Hub surveyed 4,018 brands who spent a combined $514.9 million sponsoring YouTube videos in 2022. So what are some of the factors brands look for in potential sponsorship opportunities?

Channel niche

The first factor most marketing folks consider when looking for YouTube creators to sponsor is their niche. 

Take a budget travel vlogger, for example. It would make sense for a brand like Skyscanner (a cheap flight comparison tool) to sponsor them, compared to Skillshare (a popular e-learning platform). 

Brands seeking YouTube sponsorships want to partner with creators who make content for their target audiences. When content creators partner with brands that don’t align with their niche, it often comes across as inauthentic or, worse, “selling out.” That can be bad for both the brand and the creator. 

Subscriber count

After finding a YouTube channel that matches their niche, the next factor brands look at is the channel’s number of subscribers. 

You might think that the more subscribers you have, the better, but that’s not always the case. Smaller businesses won’t have the budget to sponsor videos on a channel with more than a million subscribers, but they can easily approach small channels that have a super niche audience. Depending on the budget and marketing strategy of a brand, they approach YouTubers in the following categories:

• Nano-influencers: 1,000–10,000 subscribers
• Micro-influencers: 10,000–100,000 subscribers,
• Mid-tier influencers: 100,000–500,000 subscribers
• Macro-influencers: 500,000–1 million subscribers
• Mega-influencers: more than 1 million subscribers

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Each influencer group has pros and cons, so don’t be discouraged if you’re just getting started — brands will still work with you!

Audience location 

Brands also look out for a key demographic: audience location. A brand that exists only in the US isn’t likely going to get new customers if the YouTuber’s core audience is Australian.

A global audience is great for big international brands, but they might still be interested in a solid localized audience to boost performance in that market. 

Video views

Engagement is a hot topic in influencer marketing. It’s one of the ways a brand can figure out the difference between an authentic creator and a fake one (e.g., someone who buys bot subscriptions). One metric that helps is the number of views received by the YouTube videos on the creator’s channel.

Naturally, a channel’s average video view count generally correlates with the number of subscribers the channel has. Any videos with a view count significantly less than the number of channel subscribers should raise a red flag.

Has a recent video gone viral, skewing the average views? Do the views seem low considering the channel’s large number of subscribers? Are the views more than expected for a channel of its size?

These are all questions a brand will want answered when looking at partnership opportunities.

Average watch time

Another key metric for engagement rate brands are interested in is average watch time. As you might expect, brands are interested in channels that generate a lot of watch time. More time equals more opportunities to capture the audience’s attention. 

However, it’s worth noting that while the TikTok-like YouTube Shorts generally can’t be monetized on the app, they do count toward a channel’s total watch time. 

Audience location, video views, and watch time are all analytics you can find in the YouTube Studio.

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Read more: Understanding YouTube analytics to level up your channel

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So if a creator posts a lot of YouTube Shorts versus long-form video, that might affect a brand’s opinion of their total watch time and whether to work with them — which leads us nicely to our final factor.

Types of influencer content

The ideal scenario for any brand-sponsored post is for the ad to blend seamlessly with the creator’s content. That’s not to say sponsored videos should be disguised as regular videos (illegal in many places, unethical otherwise), just that the type of content makes sense for both the brand and the creator.

Suppose a creator’s channel revolves around product reviews (e.g., Marques Brownlee). It would make sense for a brand to approach the creator for a sponsored product review with either an entire video fee or by sending them free products.

Product placement on channels that make engaging YouTube Shorts might be the best option for brands with smaller budgets. 

Despite all the variable factors above, there are parts of your channel, regardless of its size or audience, that matter for brands. Making a YouTube banner that attracts an audience, as well as editing your videos to a high standard makes all the difference for attracting more, and better, brand deals.

How to price your YouTube sponsorship packages

Now that you know the thought process from the brands’ perspectives, let’s look at how some extra information can help you figure out your pricing for YouTube sponsors.  

Know your audience size

Despite this guide being about how much to charge for your YouTube sponsorship, it’s worth factoring in the total size of your online audience. For example, let’s say you have a super large following on other social media platforms, and you’re just starting your YouTube channel. 

You may only have a fraction of your other platform followers subscribe to your channel initially, but you can cross-promote your videos on these platforms. This means your sponsors may appear to your other social media followers. 

For example, TikToker @kaelimaee has a TikTok following of 14.1 million and a YouTube channel with 868,000 subscribers. If she pitched sponsors, bringing up her millions of TikTok followers would make more of an impact.

You might also be a podcast host optimizing your podcasts for YouTube but playing to a much bigger subscribed audience on podcast-specific platforms.

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Another digital marketing channel you shouldn’t overlook is the email newsletter. If you have a growing email list, you can pitch this part of your audience to sponsors. 

Determine your ideal sponsorship model

Here’s the tricky part of the whole deal. What kind of sponsorship pricing model should you use? There are a few options to choose from, each with its pros and cons:

Cost per mille (CPM): This is how much you charge per thousand views (“mille” is Latin for thousand). It’s a common approach to sponsorships, where brands pay a certain amount per “mille” within an agreed period (e.g., 30 days).

A typical ballpark range CPM for mid-roll or pre-roll ads after seven days on a 30-day average is $30 to $70, with $50 being a good point to push for. You’re more likely to command $70 when the brand wants you specifically or you’re in a specialty niche.

You can calculate the total cost of campaigns using this metric with the following formula:

Sponsorship cost $ = CPM x views / 1,000

Cost per action (CPA): Another way of saying conversions. In this case, the brand will pay you a certain amount for each action (i.e., predetermined, such as purchases, email signups, etc.). This method is less common for sponsorships, as it resembles an affiliate marketing strategy.

Cost per install (CPI): Similar to CPA, CPI is a fee for the installation of apps or other digital products. This is most likely the best way to go for mobile gaming creators, as it’s accurate, and more installs demonstrate your value. You can also pair this method with a flat fee, with the installs paid as a bonus per install.

Fixed fee: In this case, you and your sponsor agree to a fixed fee before starting your sponsorship campaign. Compared to the other methods, this one provides a more consistent income stream, but you lose out on any potential gains from greater-than-expected performance. 

Instead of plucking a number from the air, it’s a little more accurate to charge a flat fee based on your CPM. For example:

Flat Rate = (views from the past 30 days / 1,000) x CPM 

E.g. (50,000 / 1,000) x $50 CPM = $2,500

However, if you’re creating a dedicated video, it’s worth charging a premium — you can charge three to 10 times your usual CPM.

Determine your sponsorship packages 

As you might have noticed in the explanations of CPA and CPI, it’s also a common practice to bundle pricing options to create sponsorship packages.

A great way to package your sponsorship deals is to think about the brand’s business objectives: Do they only want more brand awareness? Or are they looking specifically for sales conversions? Depending on the answer to these questions, you can tailor a package for them. 

But what goes into a package? Here are the specific sponsorship opportunities you can offer brands.

Pre-roll ads

When an ad plays right at the start of the video content, this is a pre-roll ad. These ads are usually more expensive because you can guarantee your audience will see the ad and will most likely have better conversions.

Here’s an example of a video with a pre-roll ad (the ads in this section may not appear if you have YouTube Premium):

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In this case, there’s a short intro before the pre-roll ad, which plays before the rest of the video.

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Mid-roll ads

These are ads that play in the middle of a video. While they may cost a little less than pre-roll ads, there’s a chance fewer viewers will see them, since not every viewer watches the entire video. However, another benefit to these ads is that the placement tends to feel more organic. It’s a popular choice for brands and creators, making it easier to negotiate.

Here’s an example of a video with mid-roll ads:

(Link opens a couple of seconds before the ad)

Post-roll ads

Ads that play at the very end of a video are called post-roll ads. These are typically the cheapest option because you can’t guarantee many viewers. As a result, conversions generally are lower here. However, your channel’s superfans will likely watch until the end, so if you have a niche audience, you can charge a small premium. 

Here’s an example of a video with a post-roll ad:

Pre-, mid-, and post-roll ads can all take the same amount of time and effort, e.g., a minute of published footage (plus scripting and editing). The difference between them is just the placement of the ad.

Dedicated videos

Dedicated videos are the cream of the crop. They’re the most expensive option because you put the brand front and center for the entire video, which creates a compelling offer for brands. 

The main downside to this option is that your audience might not appreciate a video completely dedicated to a sponsor (depending on your niche). 

Here’s an example of a dedicated video sponsor:

Of course, entire videos take more time and effort than in-video ads, and often the brand will want to collaborate and approve the video itself — which adds time to the project and stress for the creator. That’s why these ads should get a premium rate.

Product placement

Depending on the type of videos you produce for your channel, product placements — the use of a brand’s product in a video without directly referencing it — can be a good option. This typically means cheaper sponsorship for brands but also allows you, as the creator, complete flexibility. 

Here’s an example of a video with sponsored product placement:

In this example, Elizabeth’s headphones are a product placement, with a link to purchase a pair in the description.

You can offer all of the above opportunities to brands individually or in a mixed assortment as a packaged campaign deal, e.g., have one dedicated video, then a series containing mid-roll ads.

Bring it all together

With all the information you now have, you can start developing your own YouTube sponsorship pricing strategy.

Note your audience size and your channel’s niche (Is it small but specialized? Large with a broader niche?), and decide what pricing package you’ll offer.

Let’s go over a quick example:

You’re a bodybuilding YouTuber and a supplements brand has asked to sponsor you. While technically a smaller niche than overall fitness, bodybuilding is still a sizable niche, and you have 47,000 subscribers on YouTube. Your average views over the past 30 days were 2,900, and you have an average watch time of five minutes.

Under these circumstances, you can offer a CPM of around $40 (higher than a super broad niche, but you’re considered a micro-influencer, and your engagement rates are about average).

Your sponsorship rates would look something like this:

• Pre-roll ads = $45 CPM (using the averages would result in a charge of $135)
• Mid-roll ads = $40 CPM (same as above, results in $119)
• Post-roll ads = $35 CPM (results in $101)
• Dedicated video = 5 x mid-roll CPM (results in $595)
• Product placement = low $20 CPM (results in $58)
• Flat Rate, in this case, would calculate the same as mid-roll ads — the above results use average figures but could go up and down based on video performance. However, you’d charge $119 (or round it up to $120) as a flat fee before producing the video. 

Using the formulas provided earlier can help you figure out exactly how much money different CPMs would get you — but it’s essential to double-check the rates you come up with against benchmark figures in your niche so you don’t undercut or overestimate your pricing.

Get new YouTube sponsorships with confidence

By now, you should have a pretty good idea of what it takes to price your YouTube sponsorship deals. Moving forward, when brands approach you for sponsorship opportunities, you can quote them a fair price based on your research without feeling like a fish out of water.

Another way to get more, or better, sponsorship deals is to level up your content production game. Descript helps you write, record, transcribe, edit, collaborate, and share your videos and podcasts all in one platform — giving you one tool for your whole workflow.

Get started with Descript for free today.