Creator's Guide to Monetization on Content Platforms

At FreshCut, we give creators 90% of all tips received on our app because we believe creators deserve better. This is a dramatic difference compared to existing revenue share from other content platforms.

Frank Shotwell

Wed Dec 07 2022

6 min read

Content platforms haven’t seen much disruption when it comes to creator monetization and revenue sharing. Gaming creators are used to the big tech platforms taking 30-50% of their revenue. The majority of creators take home a small share of the revenue they generate for the big tech platforms. Within this group, the top earners are concentrated within the top 1% of all creators on the platforms. The existing content ecosystem enriches the big tech companies at the expense of creators and their communities.

How Do Creators Monetize Today?

Streamers and content creators rely on a combination of account subscriptions and tipping from income generated on-platform. If creators are leveraging video-on-demand, this can be a mix of advertising and membership revenue sharing as well. Usually the platform like Twitch and YouTube will take around half of the creator’s revenue. This means creators will look to supplement their income with brand sponsorships and affiliate deals. Teaming up with orgs for competitive or content support is also a popular way for creators to add revenue streams and increase their exposure.

As a result, it’s difficult to be a full time content creator. Given the US median household income of ~$71,000, very few (the top ~1300) creators on Twitch are able to make that based on platform revenue sources alone (subscriptions, ads, tips). This is the top 0.015% of streamers on Twitch. When you factor in the major revenue share tax that the platforms take, streamers need to have a significant following to be able to make enough to be full-time. This is where additional ways to monetize come into play.

New Creator Revenue Share Models Emerge

At FreshCut, we give creators 90% of all tips received on our app because we believe creators deserve better. This is a dramatic difference compared to existing revenue share from other content platforms.

We’re starting to see platforms follow suit and reward the creators that help build their community. For example, Discord has offered a similarly generous share of 90/10 with their new server subscription product. While it’s not a silver bullet in terms of helping content creators achieve their dreams, sharing more revenue with creators is a good starting point. We believe the creators that help build the platform should be rewarded for their efforts. In this blog, we will explore current revenue splits on different content and creator platforms.

Monetization on FreshCut

On FreshCut, any creator can monetize. You don’t need to be a partner to take advantage of creator tips. Creators can receive Diamond tips (FreshCut's virtual currency) and exchange them for real money. FreshCut keeps 10% of the tip while creators keep the other 90%. More Diamonds in a creator’s pocket makes a difference!

Hear it from a creator

FreshCut also offers a Partner Program, where partners can access the $1M Creator Fund, Partner rewards and other benefits to help them monetize. As FreshCut grows, additional monetization features and opportunities will be added. Helping creators will always be at the core of the FreshCut mission. We realize creators contribute so much to content platforms and are not being fully rewarded or given their fair share. At FreshCut, we believe the only way for the industry to keep growing in a sustainable fashion is to give creators a bigger slice of the pie.

Monetizing on Other Short Form Content Platforms

Monetization on TikTok

TikTok’s massive reach makes it an exciting platform for creators. Where else can you go viral and get hundreds of millions of views in the matter of weeks? The power and reach of the algorithm has made superstars out of creators. But it comes with a challenge. For all the massive view, like, and follow numbers TikTok can bring a creator, it’s very difficult to convert that into actual money on the platform.

While TikTok is one of the most popular apps in the world, it's not known for paying out much money to their creators. Creators like Hank Green and Mr. Beast have spoken out about the lack of revenue share they see on the platform. Revenue share from the creator fund is extremely low per view. Only the biggest creators are able to get a share of the ad revenue they generate and monetize. TikTok has announced that it will start sharing ad revenue with creators who produce the top 4% of best-performing videos. Creators get 50% share of ad revenue via TikTok Pulse - but need at least 100k followers to qualify.

Massive reach does not equal significant payouts on TikTok

The most impactful way creators currently monetize on TikTok is via sponsorships and promoted posts that are negotiated directly with brands, via talent agencies, or via sponsorship marketplaces like Pearpop. These can be very lucrative given the size and reach of accounts on TikTok, but are much more manual to source, negotiate, and complete.

Smaller creators can earn from virtual currencies and gifts, but the TikTok revenue share remains significant. Creators can monetize via virtual goods on the platform, be that gifts (like Roses) or TikTok Diamonds (their virtual currency used to purchase gifts). Creators can also receive tips from their followers - this is where TikTok is more generous and gives creators 100% of tips after service fees. However - this is not a primary revenue source on TikTok and its not easy to use or widely promoted. Connections with followers on TikTok are not as strong as platforms like Twitch.

Monetization on YouTube Shorts

YouTube Shorts has rapidly been rising in popularity as YouTube’s short form content competitor to TikTok. Shorts is relatively new to the scene, so YouTube is  just introducing its first monetization features in 2023 which will see YouTube take 55% of ad revenue, with creators keeping 45%. Creators will need to be YouTube Partners to take advantage of this benefit. One new feature is that creators can become YouTube Partners based on their Shorts content - not just from their VOD or streaming content. YouTube currently offers a $100M Shorts Creator Fund to kickstart growth on the platform.

Monetization on Instagram Reels

As TikTok took off, Instagram launched its own competitor in Reels. The number of Reels pushed via the Discover page and in your feed alone is a good sign of Instagram’s intentions. They’re leaning into short form video content hard to keep up with TikTok. However, while Reels can similarly bring virality and views, it’s very difficult to actually monetize as a creator. There are few monetization features for all but the largest creators, and there are no tipping features yet on Instagram. Instagram is planning to launch a sponsorship marketplace and allow creators to sell merchandise in the near future. Brand sponsorships, promoted ads, and affiliate links remain the main source of income for creators who use Reels.

Monetization on Twitch

While Twitch is the home of many creators, its revenue sharing agreements have recently been the topic of debate. Twitch takes 50% of all subs (where they previously had a 70/30 split with larger creators) as well as 30% of all Bits at purchase. Many creators have expressed how difficult a 50/50 split makes it for them to monetize off of subs. Twitch and other content platforms rely on creators to produce engaging content and attract viewers, but these businesses only offer marginal compensation for their creators’ efforts compared with the amount of revenue generated by the platform as a whole. As a result, it’s difficult for smaller content creators to make significant money even if they reach Twitch Partner status (or its equivalent on other platforms). Considering how revenue sharing works, these platforms effectively end up catering to 0.01% of their creators.

Gaming creators play a huge role in influencing the community and industry. Creators need better ways to monetize as platforms benefit from their work. Simultaneously, the content platforms that rely on creators for their content and communities should offer more equitable revenue sharing. At FreshCut, we’re doing our part to support creators and their efforts to monetize their short form content.

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