Sounds like a sweet gig, but according to Forbes, seven year old YouTuber Ryan’s ToysReviews has the market cornered and generated the most revenue of any YouTuber this past year.

YouTube has become a wealth generator for a new breed of digital stars. Just over ten years ago YouTube didn’t even have an ad product to help creators make any money – now it’s not uncommon to hear of creators generating 7 figure incomes.

In looking at the Forbes list of the top 10 Highest-Paid YouTube Stars of 2018 there are three major trends that really stand out to me.

1) BUILDING A BRAND (VS RELYING UPON BRANDS)

At YouTube’s NewFronts in 2015 John Green (founder of Vidcon and avid YouTuber) spoke to an audience comprised of major brands. He gave them a warning that “YouTube stars are building a world where they don’t have to depend on advertising and they are thriving.”

In short more YouTube stars will find other non-advertising revenue streams like merchandise sales and book deals to replace advertising dollars. It seems as that prediction has largely come to life.

All the influencers on Forbes list have invested in brands that live independent of traditional Fortune 500 advertisers.

Ryan’s ToysReviews partnered with BonkersToys to create an entire product line under the brand, Ryan’s World. Parents can purchase these in any major retailer, and demand is built-in. Ryan’s generated over 20 BILLION views and has over 15 million subscribers.

Ryan’s hardly alone, Jeffree Star, number 5 on Forbes list with an estimated $18 million in earnings, shocked the YouTube community when he unveiled his personal and professional life or Shane Dawson in a 5 part docu-series. In it Jeffree showed the factories producing his massive makeup line.

While most anyone familiar with the YouTube/makeup community on YouTube was well aware of Jeffree’s product line, few knew just how much revenue he was generating and the lavish lifestyle he was living as a result. Jeffree has a mansion in Calabasas, dozens of designer handbags worth hundreds of thousands of dollars, real estate, fancy cars, designer clothes, etc.

Logan Paul, number 10 on Forbes’ list, was once the darling of advertisers everywhere – having done brand deals with Fortune 500 companies Pepsi, Walmart, and Dunkin Donuts. After filming a body found in Japan’s ‘Suicide Forest’ this past year Logan was largely blackballed by brands, but that hasn’t stopped him from earning.

Logan has a massive merchandise business, Maverick By Logan Paul, where you can buy everything from Logan Paul branded socks, hats, posters, pants, shirts, and more.

Beyond Jeffree Star, Ryan, and Logan Paul all the other top earners from Forbes have invested heavily in developing their own brands and product lines.

DudePerfect has a product line with Nerf, DanTDM has done tours and sells merch, Markiplier launched Cloak, a high-end athleisure line for gamers, Jake Paul has created a network of creators, Team 10, and a massive clothing line.

All their businesses live largely independent of traditional ad revenue or brand sponsorships.

2) KIDS ARE FUELING GROWTH

In scanning the Forbes list of YouTube’s top 10 its clear that teens and young kids are fueling the growth of these channels (and the YouTube ecosystem as a whole).

Officially Google only allows people ages 13 and over to create a YouTube account, and the minimum age is as high as 16 in some EU countries.

However, it’s no secret that young kids and teens are making up an overwhelming amount of YouTube viewers.

70% of kids 13-17 use YouTube daily, and there are 8 million weekly viewers of YouTube Kids (YouTube’s app dedicated towards curating children appropriate content). The top 8 most recognizable celebrities amongst teens are YouTube stars, and the number one most desirable job amongst kids and teens aged six to 17 is digital star.

Ryan’s Toys Reviews format is a seven year old boy reviewing and unboxing toys.

Jake Paul has mentioned in multiple videos that his audience is as young as eight. Logan Paul has been nominated for five Teen Choice Awards.

A cursory look at any meetup these YouTubers have shows that the overwhelming majority of fans are young kids and tweens.

In spite of the fact that kids aren’t supposed to have YouTube accounts they’re fueling growth, and revenue for the biggest creators.

3) GAMING

Gaming has gone mainstream.

Six of the top 10 creators featured on the Forbes list of the Highest-Paid YouTube Stars of 2018 built their followings on the backs of gaming content:

• #9: PewDiePie is best known for his ‘play with me’ videos.
• #8: Jacksepticeye is also known for ‘play with me’ content
• #7 VanossGaming plays titles Call of Duty & Assassin’s Creed
• #6 Markiplier is known for his ‘hilarious’ gaming videos
• #5 DanTDM specializes in Minecraft

Furthermore, the #1 most subscribed YouTuber of all time is #9 on this list, PewDiePie. He’s currently racked up 75 million subscribers.

The trend within YouTube is representative of a much larger cultural shift. We’re at the stage where esports athletes are actually getting more recognition and social mentions than traditional athletes. Earlier this year Twitch Streamer, Ninja, actually generated more social mentions than every major, traditional, sports athlete worldwide – more than Lebron, more than Kobe, more than Rinaldo.

The US video game industry generated a record $36 billion in 2017 and esports leagues are generating so much revenue they’re offering $25 million dollar price bags for the winner.

So what’s the key takeaway from all this?

YouTube culture is pop-culture and the biggest earners have invested heavily in themselves. Time will tell if dominating the youth market today will lead to loyalty long-term, but in a future where creators are brands (and companies) what does this then mean for the future of Fortune 500 brands?

There’s a reductive narrative circulating in the advertising world lately: if you need to meet your marketing goals, then you should do influencer marketing.

Want to reach millennials? Influencer marketing speaks to teens! Want to be more efficient with your advertising budget? Influencer marketing is cheap! Want to be ahead of the curve? Influencer marketing is the future!

I understand the allure of this narrative (it’s one I’ve contributed to at length). Influencer marketing is commonly presented as the mother of all marketing shortcuts. But that’s just the thing: there are no shortcuts.

Influencer marketing is sustainable when it’s built on a thoughtful relationship among a brand, a creator, and the fans that consume the content. Like any relationship, it takes time, energy, and money to maximize its potential. Brands are often unwilling or unable to make that kind of investment, so as a result, they engage influencers carelessly and enter a “me-too” race to attempt what is trendy or has worked well for others.

Just because you “did influencer marketing” doesn’t mean you did it well.

Brands often make the mistake of taking a lackadaisical approach, doing just enough required to check the box for hip marketing. They make use of automated platforms that connect them with influencers-for-hire where there’s no relationship to speak of; they’re not even communicating on the phone. This “spray and pray” approach  results in virtual strangers touting brands in which they have no vested interest.

Consider the case of one social agency reaching out to well-followed Instagram user Coltrane Curtis, offering him an influencer gig to promote Dove skin care products. Had the agency done any homework on Curtis ahead of time, they would have quickly learned that he ran his own agency and was, in fact, the competition. He publicly shamed the agency for its carelessness. Thoughtless influencer marketing is a liability, not an asset.

Operating this way dilutes the credibility (for both the brands and the influencers) that makes this tactic work. Credibility is all about representing one’s true values and beliefs. If representing a brand’s true values was as easy as writing an email and signing a check, then everyone would do it. And that’s exactly the problem.

My message to companies adopting this attitude is simple: please, don’t do influencer marketing.

No Fortune 500 company got to where it is today by taking shortcuts. They designed real products, built real infrastructure, and hired high-quality, full-time teams. Thoughtful brands play the long game. Why should influencer marketing be any different?

Having worked on thousands of influencer campaigns, I can say that the best collaborations are those in which the brands have invested in getting to know the creators. They’ve brought the influencers to company headquarters, shared their brand values, outlined the goals of the campaign, as well as the thinking that got them there; they mixed education with entertainment. The face-to-face interaction that is so uncommon these days leads to influencers being invested in the people and campaign in a way that has tangible results — they want to do right by the brand. Because they understand what they’re working on (and care more), they promote it more often and more effectively.

Along the same lines, I’ve negotiated multi-year contracts with creators on behalf of brands — the brands benefit extensively by getting economies of scale, efficiencies and category exclusivity. But, more than anything, the creator understands the brand after working together for so long and his or her audience knows that the creator is more than a paid shill – this is something that he or she believes in enough to work with a brand on an ongoing basis and really collaborate deeply.

Ultimately, if you aren’t willing to invest in meaningful, long-term commitments to influencers, why should the influencers commit to working with you? Influencer marketing can be a silver bullet for messaging — only when there is a deep collaboration at the heart of the brand-influencer relationship. This is why brands must take the time and effort to find creators whose sensibilities mesh well with their goals.

If your marketing goals are qualitative, wanting to see your brand’s message taken to a talented creator’s audience, then influencer marketing is a powerful tool for getting there. If your marketing goals are quantitative, wanting to ensure some number of impressions and conversions without much thought, then please don’t do influencer marketing.