SkillShare sponsors almost every video on Youtube. They sponso seemingly everyone & it’s been a while since they’ve been doing that.
But have you ever asked why Skillshare is actually sponsoring so many different YouTubers? And why seemingly they are spending so much money on sponsorships? What content creators are getting from them and what they are getting in return?
So let’s start crunching some numbers and unlock the mystery behind their sponsorships.
Before we’re gonna start, it is a full disclaimer here. A lot of things that we’ll be discussing here will be based on pure speculation based on our own experience and experience of the other YouTubers and bloggers that actually reveal their own numbers.
The numbers that we are going to be giving you are just approximations based on reality with some exceptions of course.
Because we have some numbers for sure and actually don’t have any access to the Skillshare contracts and these approximations will be different for every single advertisement.
Every single sponsorship is based on a case-by-case basis even between the same parties.
So with this disclaimer out of the way let’s start calculating the numbers.
Before we’re gonna go into what actually Skillshare is paying, let’s just start discussing how youtube sponsorships actually work.
Unfortunately, there is no universal way of doing youtube sponsorships because every single one of them will be different and every single contract even between the same parties doing the same job can be different.
Because some circumstances might change. It can be a fixed price. It can be the price based on previous views or it can be just priced based on negotiations.
Usually, the payment model for youtube sponsorships is one of the three modes.
It’s either direct payment for the sponsored spot.
It can be a 10-second spot, 30-second spot, 16-second spot or it can be even an entire video dedicated to the product.
In the case of Skillshare, it’s usually somewhere between 10 to 60-second spots or it can be payments through affiliates where creators actually being paid based on the products they sold or services or it can be a mixture of both.
In this case, they are doing the last one because every single video by them includes affiliate links which is an extremely important thing to earn money even if you are not sponsored by them.
Okay yeah, you heard it million times how YouTubers are being sponsored.
Skillshare Affiliate Program
But now let’s get to the real numbers and let’s start by discussing Skillshare Affiliate Program.
First, Skillshare has actually two different affiliate programs.
First, its main affiliate program is powered by influencers and second is a referral program.
First is again reserved for influencers and for larger audiences that require sign up and second is a referral program that can be used by anyone.
The difference between those is this, for referral program which everyone can sign up for everyone.
Who sign up through your links gets two weeks of Skillshare premium and you yourself get 10 USD for this.
I don’t know for what reason but sometimes they are not giving away 10 dollars for some people and they’re just giving away a two-week premium package for the referrals as well.
While in an affiliate program the creator actually gets only 7 dollars per sign up but is giving away an entire month of that premium subscription.
Because usually, the people who are using affiliate programs are far larger creators with far larger audiences, they are getting far more signups, and their deal is actually better.
So now as you can see for every signup, creators of those affiliate programs are getting 7 dollars.
We can actually approximate the number of affiliate signups through the sponsored videos but we’re going to calculate this a bit better.
So stay patient there and now we got to the real meat.
What about direct payments? How much Skillshare is actually paying for sponsor video?
Okay… usually the payments of the sponsored videos are calculated through CPMS or RPM, whatever you want to call it and it’s basically the payment per thousand views.
So an approximate number of views that this sponsored video will get, will be calculated from previous videos.
It can be the previous 5, it can be the previous 10, whatever.
For example, if your previous 5 videos on average got around 100,000 views, you will negotiate for payment for 100,000 views as for the prices.
The payments can be wildly different. CPMS can start from 10 and go up to 150.
Of course, it all depends on an ad spot.
It can be dependant on how long the ad spot is.
It can also depend on how many videos you are negotiating because if you are doing only one video the CPM can be higher.
If you are doing multiple videos CPM can be lower.
So that means approximately 100,000 views, the creator should get somewhere between 1 to 15 dollars and this is per video.
If your average views are somewhere around one million that means that you are getting somewhere between 10,000 to 150,000 dollars per video.
But usually the more views you get on average the lower will be your CPM.
So for 1 million views, you’re probably going to get paid somewhere between 10 to 50,000 USD.
And yeah again this is speculation and can be different on a case-by-case basis.
So now we know approximately how much creators are getting paid for their videos and this is of course excluding affiliates that we’re going to be discussing just in a little bit.
Again stay patient but what Skillshare is actually getting from all this? Why is it worth it for t to pay them p to 50,000 dollars per video?
That’s the real question and we can understand this from calculating their service payments directly.
So Skillshare service costs 2O USD per month if you’re paying monthly and it costs 100 USD per year if you pay yearly.
It is actually implementing the regional pricing as well because for me the price is actually wildly different than that.
And the 20 dollars and 100 dollars is actually the U.S prices but on average people who are actually subscribing on Skillshare, they’re actually buying a yearly plan.
Because it actually will cost much less in the long run of course.
So that means they’re paying 100 upfront.
Let’s assume that this is the lifetime value of the customer which I think actually can be much higher but let’s say this is just 100.
Basically, Skillshare is getting 100 per customer gained from those videos, so let’s now imagine that they actually paid for video with around 1 million views.
And let’s assume that they paid 50,000 for this.
They will probably pay closer to 30,000 but let’s assume the worst-case scenario for Skillshare at least if only 0.1 of those views would convert into paying subscribers, this will be 1000 signups.
Usually, the conversion rates are actually much higher.
Again let’s assume only 1000 people signed up from this 1 million viewers.
The lifetime value of 1000 people will be 100,000 dollars.
Let this thing in, they paid 50,000 and getting 100,000 back right now.
Not so fast.
They’re not getting that much money but at least based on our example.
That means that Skillshare will pay 7 dollars per individual who signed up through the service.
So that’s additional 7 thousand dollars coming from their pocket and going to the creator’s bucket.
That’s 57,000 for 1 million views but this is not their all expenses.
Skillshare is actually paying 30 of subscription income directly to the instructors so in this case from 100,000 made 30,000 would go to instructors.
Right now we are excluding all the operational costs which will not be that much but excluding operational costs, all the costs through this 1 million view video will be 87,000.
They will still be left with 13,000.
So with a single video, they would make 13,000 and this is based on the assumption that they would pay fifty thousand dollars which will be in a very rare scenario.
Again most likely they would pay somewhere close to 30.000 dollars and if they would pay this, their profit from this bargain basically would be not 13,000 dollars but 33,000 dollars.
That’s how much money Skillshare is making per video more or less.
Of course, that’s why they are sponsoring so many videos.
One month free subscription that they are providing to their viewers is actually an amazing bargain and it’s very easy to click on and to subscribe and it’s a great bargain for the YouTubers as well.
Because they’re promoting the great product and viewers are getting the great product as well.
Skillshare is getting money for this and because it has amazing curated content as well which more or less is becoming like Netflix for online courses.
It is making the brand an amazing value even though the info that you will find on Skillshare can be found on youtube or any other platform for absolutely free.
But there is no other place where you’ll find information in such an organized way, in one place, in such high quality, and with such high entertainment value as well.
Overall now you know how Skillshare is actually making its money and why it is paying so much money to the creators and you can apply the same principles to other sponsors as well.
What do you think are you tired of their sponsorships did you actually subscribe through those affiliate links that are provided in those sponsored videos?
You can visit the official Skillshare site for more information related to its services and programs.
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