The YouTube Formula: Update

This is not part 4 of the book review. Consider it “extended value” as YouTube creators refer to bonus material.

The holidays have kept me hopping so I apologize for not finishing Derral Eves’ excellent book on mining the treasures of YouTube’s history and how to get friendly with their algorithms. I promise to give you a thorough and decisive part 4 before New Year’s. Meanwhile, dawdling with word games in my spare moments gave me a huge insight (at least I think so) about monetizing focused time spent online.

This is a long conversation and one that’s still over my head a bit so let me start with the “aha” moment today and then work backwards to some material in Eves’ book that I hadn’t valued properly and see as significant now. I was playing a word game on my phone this morning and, as is usually the case, when I’m in the zone I lose track of time. This is a kind of confession because I know I really ought to be doing bold, constructive things to move my life forward and all that.

Nevertheless, I was hooked on solving word games. I know, I saw the movie too about how these programs stimulate the release of dopamine in the brain. That’s the science behind why they’re so addictive and it’s pretty scary. Even though I was feeling guilty for the “time off,” I now understand that word puzzles aren’t so far off track for me. At least for today. Here’s what happened.

Every now and then an advertisement would pop up about how you can make money doing crossword games. What? Seriously? I had to investigate. This isn’t the volume of money that can be realized on a polished, dedicated YouTube channel by any stretch but it is an opportunity gamers can easily adopt. This is likely to appeal to those with low ambitions. As long as they’re wiling away the hours online, why not get paid?

Here’s the highlight. There isn’t just one game offering money if a player spends lots of time on their site. It’s almost all of them. I’m not a gamer unless it’s word games but it seems the gaming industry has picked up on YouTube’s gold rush discovery. The difference is they’re using YouTube’s model in reverse. At least that’s how it appears.

Instead of paying gamers to create content that generates ad opportunities and rewarding the creators who keep viewers online (as YouTube does), they reward gamers to stay online so the game copyright holders can monetize the ads. It’s revenue sharing spelled backwards. The more I think about it who knows? Maybe they have a profit-sharing structure in place that mirrors YouTube exactly. It’s just not information you can easily access as far as I know.

What I’m saying is that YouTube turned online marketing on its ear when it started paying individual channels a share of their ad revenue based on views, subscriptions, production values and hours watched. As brick and mortar shops continue to shutter and people in the intellectual market seek business models that reward them for content value and customer loyalty, we’re going to see more and more of The YouTube Formula.

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