When chess was invented the inventor presented it to the king. The king immediately fell in love with the game. 

He offered the inventor whatever he wished. 

The inventor asked that a grain of rice be set on the first square of the chess board then double on each subsequent square. He demonstrated it briefly – two grains on the second square, four on the third, and so on. 

The king agreed. He thought he’d gotten a bargain and ordered his treasurer to pay the inventor.

After a great deal of time passed the inventor returned. He complained to the king that he wasn’t given his reward.

The king called upon the treasurer. 

“Why has the inventor of this brilliant game of chess not been paid!?”

The treasurer explained it was impossible. 

By the time you were half way through the chessboard, the amount of rice required was more than the entire realm had or could even afford. The gift would empty the royal coffers and put the entire kingdom in debt.

What does this have to do with social media and advertising?

The entire industry tends to measure success in large numbers. We launch campaigns and watch to see how many views, comments, engagement, or impressions we generated. How did we do compared to our competitors? 

There’s nothing inherently wrong with this approach, but there is an unintended consequence. 

We never want to start small. We make the same mistake as the king – we can’t believe that starting with so little can lead to so much.

How many times have you heard (or asked for) this? 

“We want at least a million views!”

If an agency ended up getting 10 views on a YouTube video when the goal was a million, I think we all know what would subsequently happen. The agency would be viewed as failing to hit their KPIs and most likely let go.

While it’s counter-intuitive, starting small is the way to generate massive results in the long run. 

The formula is continued attempts + consistent refinement. 

Using the allegory of the king and the chess board, it’s how one grain of rice slowly grew to the net worth of the entire kingdom. 

A group of scrappy filmmakers, i.e. influencers (implicitly or explicitly) understand this. They’ve become one person media juggernauts by implementing it. One of them is ZHC (real name Zachary Hsieh). He’s a 21 year old YouTuber from San Jose, California who’s racked up a billion views and over 15 million subscribers. 

ZHC generates prime time TV level viewership. 

In the last month he’s reached 5x the audience of a typical ‘Monday Night Football’ viewing, 6X the audience of ‘The Masked Singer’ and more viewers than all episodes of ‘The Last Dance’. 

Think about that for a second. In the last month he garnered more views than all ten episodes of the ‘The Last Dance’. That was ESPN’s highest rated documentary of all time. It dominated news and social media for an entire month.

How the hell did ZHC become so huge? His viewership was not happenstance.

ZHC’s success seems deceptively obvious on the surface. His format is MrBeast meets Andy Warhol. Pop art with a stunt. 

ZHC takes high-end devices such as iphones, ipads, Tesla’s, and even a bus then paints them. He gifts these beautiful (and expensive) items to unwitting fans or other influencers. The reactions are always priceless.

There’s a formula. 

The gifts are expensive. The influencer guest appearances are top tier. He’s featured the single largest YouTube creator PewDiePie. Addison Rae who has the second largest following on TikTok. He’s collaborated with Marshmello, as well as, Charli D’Amelio who has over 70 million followers on TikTok. The reactions he captures create a halo-effect of elation.

It all seems very obvious – gather big stars and give them expensive gifts… However, unless you dig into his back catalogue, you won’t see his hundreds of videos that were the foundation for today’s “obvious” success. Like most ‘overnight’ successes ZHC has been grinding it out for years. He posted his first video 4 years ago. By the end of his first year on YouTube he’d posted 50 videos. 

Guess how many subscribers he had? 1,011.

Can you imagine working nights and evenings for a year and only have 1k subscribers to show for your efforts?

ZHC didn’t launch with his format fully defined and community in place. The process took time. Trial and error. We can learn a lot about the process from his work. Zach’s early videos were straightforward tutorials on how to draw various comic book characters. 

Over time Zach began experimenting. 

He slowly inserted more and more of his personality into videos. 

After 40 tutorial videos he finally did a video with himself as the focus (vs his art).  That first video was “3 tips for getting lots of instagram followers”. The video was one take. He was awkward and rambling at times. The backdrop was just his living room with Zach seated on the couch. That’s it. Watch the video. Could you ever imagine that awkward guy would one day have 15 million subscribers?

The experimentation continued. You see an evolution in slow motion. 

He methodically incorporated learnings into his videos. 

Zach’s 50th video was “My Inspirational Artists Journey Story”. It was his first attempt at inspirational content. He shared his struggles with school and how art became his salvation. It gave him confidence.

His 63rd video was a ‘challenge’ video – DRAWING 1000 FIGURES IN A DAY?!. It generated more views than his typical videos and he saw the power of integrating stunts.

A month later he did a reaction video. PewDiePie (who has over 100 million subscribers) had stumbled upon a piece of ZHC’s art. Zach filmed a reaction video to PewDiePie’s commentary. This was Zach’s first time featuring another influencer in his video and it got nearly 8 times the viewership he typically got.

He continued experimenting and applying learnings into his repertoire. It took three years before he’d refined the formula to what it is today. And his views have skyrocketed.

This was not slow linear growth – always a little up and to the right. This was the growth Buffett demonstrated in the allegory of the king and the chess board. 

Small at first, then massive.

ZHC’s efforts compounded. 

He went from averaging ten thousand monthly views in 2017, to one hundred thousand in 2018, to 5 million in 2019. Now ZHC averages 100 million views a month. 

So how does this apply to advertising?

As much as the ad industry is skeptical of influencers, there’s much to learn from them. 

While we want to create a perfect ad that enters into the pop-culture lexicon. The harsh truth is the world is not waiting for our perfectly produced vision. We must start by creating and then applying learnings to improve. 

Rumi, a 13th Century poet said it best “as you start to walk on the way, the way appears.” 

That’s the long-term solution.  Constant refinement and feedback. 

ZHC implemented this process. He consistently created videos. He’d implement small experiments, and apply the lessons learned. He slowly stacked incremental wins on top of wins. Inspiration. Storytelling. Collaboration. Challenges. Surprise and delight. ZHC worked to identify his personal approach.

The formula is continued attempts + consistent refinement. 

Quantity to lead to quality.

First reported by The Information, the YouTube version of TikTok has been dubbed ‘Shorts’. The TikTok competitor is rumored to live within the existing YouTube app and take advantage of YouTube’s music licensing deals.

This doesn’t come as a total shock. YouTube has been quietly incorporating TikTok style features for some time now. Over the last month or so YouTube’s app has changed features that mirror TikTok in three big ways:

1) Emphasizing categories vs search
2) Curating content experiences
3) Providing content prompts

CATEGORIES VS SEARCH

Last week I wrote about how YouTube shifted its emphasis from search to more curated experiences (like TikTok) and was bracketing content categories in a manner very similar to hashtag challenges.

Historically, YouTube placed an emphasis on search (it being the second largest search engine). Recently the search feature was changed to ‘explore’. Now when you click on ‘explore’, there are categories of content featured that site above recommended and trending videos. Previously the app had trending and recommended content. This mimics TikTok’s has ‘discover’ feature.

At the top of TikTok’s discover page is curated content categories, hashtag challenges, and list of trending hashtags. 

YouTube is evolving from specific video recommendations to an emphasis on broader categories. 

CURATED CONTENT

When you click on a content category there’s a header and  curated list of videos to watch. This is layout is similar TikTok.

On TikTok if you click through to one of the content categories or hashtag challenge there’s a banner across the top, description of the content and then a curated list of TikTok’s to watch.

PROMPTING CONTENT CREATION

YouTube seems to be taking cues from TikTok’s hashtag challenges. TikTok’s hashtag challenges act as prompts for users to create content. Creators often jump on the challenges in hopes of being featured high up on the challenge pages and getting exposure.

YouTube has begun experimenting with its own hashtag challenges.
Due to Coronavirus millions have been forced to stay home. YouTube helped get the word out by launching the Stay Home #withme challenge. The Stay home #withme challenge invited creators to make videos around activities anyone could do from home. 

YouTube consolidated all #withme videos under the hashtag (much in the same way TikTok does). YouTube doesn’t typically create or promote specific content asks from its community. In making this change YouTube mirrored hashtag challenges.

These are big shifts for YouTube.

Search has been such a big part of the site, that playing a larger role in promoting ’discovery’ seems as though the platform is looking to modify behavior in a significant way. Additionally, YouTube has historically been passive in content creation. With the launch of #withme YouTube clearly provided a prompt for the broader community.

These changes, which are influenced by TikTok, are likely providing data to YouTube to inform their ‘Shorts’ launch.

Micro isn’t better. Better is better.

Touted as having higher engagement rates, lower pricing, and more credibility than their ‘macro’ counterparts micro influencers are the hottest category of creator to hire.

This is silly. 

Micro-influencers being better or more effective is not a universal marketing principle. Leveraging micro-influencers is a tactic, and one that is far from a silver bullet.  

The rise in popularity of micro-influencers coincides with the rise of influencer marketplaces. Influencer marketplaces are self-service platforms where brands share opportunities for creators to do paid endorsements.

Working with micro-influencers via marketplaces may seem to be a scalable way to do influencer marketing but it is wrought with issues.

First and foremost there is the common misconception that micro-influencers are more engaging. While that is often true that micro-influencers have higher engagement than macro influencers on a per capita basis, that doesn’t mean that engagement translates to a more efficient cost per engagement (CPE) for advertisers.

According to data compiled by Andrew Kamphey of Influencer’s Weekly, it is actually more efficient to work with larger influencers one a CPE basis.

As influencers get bigger their engagement generally declines a bit, but their costs don’t scale at the same rate.

One factor often overlooked in working with influencers is not just the hard costs, but the time spent to manage influencers. Working directly with an influencer that has 10 million subscribers is often just as much work as working with an influencer that has 10 thousand. 

Even if you work with influencers via influencer marketplaces, taking the time to review content and managing quality control becomes a huge issue.

Within these market places brands are asking creators to opt into campaigns based on a brief that has been posted. You are not spending time working closely with a creator via meetings and phone calls. Oftentimes a brief is the only thing the creator gets to their hands on to get to know the brand before going on to develop promotions even without the products themselves.

Credibility is a big issue as well (one that I imagine will become a bigger issue as time goes on). Creators looking to make money will need to go from brand to brand, oftentimes working with competitors in the same category. 

At the same time the inverse approach, of working exclusively with the top tier influencers isn’t a perfect solution either. Just because some has scale doesn’t mean they’re relevant to your audience.

Top tier creators are often bombarded with brand deals and opportunities. Their ability to invest in a partnership is constrained. You don’t want to work with someone that just won’t or can’t make the time for you. 

There is no easy solution and therein lies the opportunity.

Few brands and marketers are willing to put in the time and effort to focus on identifying creators that are truly relevant, then having conversations with them to gauge interest, and then work with them deeply and make them real partners. 

As the saying goes, the last mile is always the least crowded.

None of this is rocket science, but like most good things, it takes patience, focus, and a long-term outlook vs looking for quick fix solutions. 

One traditional media company in particular stands out – Viacom. Viacom has a long, storied history with the space; they’d been suing Google over alleged copyright violations on YouTube from 2007-2014. As part of that suit Viacom had been seeking $1 billion dollars in damages, but was awarded no money as part of a settlement in 2014.

Now, four years later, Viacom seems to have done a 180 and fully embraces the digital video space (and YouTube in particular).

In the case of Viacom – waiting to make serious investments in the social video ecosystem seems to have allowed them to scoop up some serious deals.

Viacom acquired AwesomenessTV for a reported $50 million, a fraction of the company’s $650 million valuation back in 2016. This comes on the heels of Viacom having bought VidCon, the largest digital video conference/major influencer gathering.

And, at the very start of the year it was announced that Viacom had acquired WhoSay an influencer-marketing company that had raised $30 million and was incubated by CAA.

With these three acquisitions Viacom turned itself into a major player in the digital video ecosystem virtually overnight. They’ve got experiential, content, and marketing.

With VidCon they have the largest YouTube gathering. With Awesomeness they’ve got one of the largest MCN’s and production companies focused on the space, and with WhoSay they’ve got an established influencer marketing arm.

The timing of all this is interesting – YouTube is well over ten years old now, but I supposed it just goes to show that sometimes patience is a virtue.

It’s often easy to criticize the old guard for being slow, and lacking innovation (its something I’ve done constantly), but oftentimes methodical and deliberate can be mistaken for slow and out of touch.

Ad formats are getting shorter and shorter (:06’s and :15’s) and countless studies are showing consumers don’t want to engage with ads.

However, it isn’t the result of people having short attention spans – its shitty ads.

There’s an overwhelming amount of hype and headlines communicating that the next generation of consumers has the attention span of a goldfish.

Millennials only have a 5-second attention span for ads (CNBC)

Decreasing Attention Spans and Your Social Media Strategy (AdWeek)

Engaging Consumers In The Era Of The Eight-Second Attention Span (MediaPost)

Young Consumers Switch Media 27 Times An Hour (AdAge)

Personally, I find these headlines, and the associated gripes from marketers to ring hollow. That marketers and advertisers are using this faux technological ADD as a scapegoat for why their advertising is consistently underperforming.

Just because advertisers gripe about consumers being difficult to reach or to spend more than a few seconds with ads doesn’t make it so. I think it’s a cop out.

I’d argue people are more willing than ever to engage with content for extended periods and time and that we’re even seeing a resurgence in long form content across mediums. There’s plenty of information to reinforce this perspective.

Ooyala recently reported that long form video content consumption is up 30 percent from last year and we’re seeing social platforms adapt to incorporate long form content. For example, Instagram just launched IGTV which allows for 60 minute video uploads. Contrast this with Vine, the 6 second only platform, which died after failing to adapt when all the other social platforms expanded to incorporate longer form content.

Also, the most popular influencers post long form content. For example the most subscribed YouTuber, PewDiePie, regularly posts videos 20-minute-long videos to a community of millions of fans.

The most downloaded podcasts are all long – each of the top 3 podcasts are usually over 45 minutes long. Joe Rogan, frequently the most downloaded podcast blends comedy, politics, and philosophy for two to three hours at a stretch. The #1 Twitch Streamer, Ninja, regularly streams for 6 hours at a time, generating as many as had 600,000+ concurrent viewers.

Despite consumers regularly opting into content for extended periods of time, brands are struggling – consumers are avoiding ads as much as possible.

Ad blockers have become mainstream and according to some studies 75% of North Americans use at least one form of regular ad blocking and about 10 percent block ads across four or more types media channels. Furthermore, 90 percent of people skip pre-roll ads appearing ahead of online video content and 82% of people report that they have closed a web page because of an autoplaying video ad. Meanwhile the vast majority of young people are scrolling past their Facebook feed fast they’re seeing less than two seconds of most ads. This trend has advertisers seriously worried and for good reason.

The marketing model has changed, but a lot of brands haven’t changed with it. Alison Lewis, chief marketing officer of J&J’s consumer business, said that for decades, the company would create two 30-second TV spots, two billboard ads and five print ads every year. That is “not how the world works today.”

Look no further than the shaving category to see how advertisers have been caught off guard – just ten years ago, Gillette dominated the razor blade market. Their ads were comfortable, predictable 30-second units that reminded everyone of something they already knew: you need razor blades on the regular, so you might as well buy Gillette.

The market had to reorganize itself with the appearance of Dollar Shave Club (along with Harry’s Razors). Dollar Shave Club’s distinctly off-the-wall messaging, heavy use of social media, and direct to consumer sales won major viral attention. The notorious startup used quirky 90-second ads to spread its word online, presenting itself as un-ignorable by comparison to the competition. Even though we live in a time when people can skip ads, block ads, and avoid ads.

While Dollar Shave Club hasn’t killed Gillette’s Goliath it sure made Goliath sweat.That’s the power of a brand that knows how to market to consumers.

According to one study 83% of people agree with the statement that “Not all ads are bad, but I want to filter out the really obnoxious ones.”177% agree with the statement “I wish there were a way to ad-filter instead of ad-block completely.”

I’ve seen in our own campaigns (at Epic Signal) that consumers are willing to engage if the content is relevant to them. We’ve seen 10-15 minute long pieces of branded content generate 75% completion rates.

In our most recent campaign with Boost Mobile, we integrated digital influencers into the above the line campaign and paid social and as a result were able to reduce their previous cost per acquisition by 50%.

With some of the work we did with Starbucks Doubleshot we saw thousands of consumers engage with positive sentiment saying things like ‘thanks’ for the content, that it was ‘inspiring’. We’ve generated hundreds of millions of earned media views, and generated engagement rates more than 10X that of most branded/advertising content.

So, while people don’t watch (most ads), its clear that it is not the case for everyone and it certainly is not because we’ve all got some goldfish sized attention spans or have ADD.

Shitty ads are keeping consumers away.

Most Fortune 500 brands haven’t had the same success as us, at Epic Signal, or Dollar Shave Club and haven’t adapted to the times. Marc Pritchard, CMO of P & G was quoted as saying:

“We stopped wasting money on 30-second ads, and we’re designing ads to work in 2 seconds,” and that, “this raises a deeper question. Looking at it through the lens of the consumer, how valuable are these ads? For example, people use social media to share things about their lives with each other. And let’s face it, ads are annoying in that context. Bottom line, it is time for marketers and tech companies to solve the problem of annoying ads and make the ad experience better for consumers.”

So what, does it take to be successful and get people to engage with your content for more than two seconds and solve the problem of annoying ads?

I see the solve as a three phased approach for each brand:

• Listening
• Relevancy
• Optimization

LISTENING
The consumers are already out there. They’re discussing what they love about the brand, they’re interests, who they follow – they’re likes, dislikes, etc. Marketers need to social listening tools and get granular with their consumers and understand them deeply. If you can’t develop a clear picture of who they are, you’re going to lose – because as the old marketing saying goes if you market to everyone you market to no one.

RELEVANCY
After listening to your audience, you can create custom content for them.

Produce something that speaks to specific audience verticals, interests, and passions –you want to be specific and targeted in your approach – the beauty of social media is how granular and targeted you can be. Creative does not need to be one size fits all anymore. For example If you’re Levi’s you can push your campaign to a rock and roll crowd, hipsters, fashionistas, men, women, parents… the list goes on. So why not create custom creative for each of these subverticals? When overlaying specific creative with targeted ads you’re message becomes exponentially more impactful.

Oftentimes, a great hack to know you’re creating relevant creative is to collaborate with digital influencers with built-in followings that overlap with your target.

OPTIMIZE AND ITERATE
Lastly – the great thing about digital advertising is you get feedback instantly. Take advantage of this.

You can launch a campaign then iterate to make it better over time. Simple tweaks of copy, or imagery, or alternative edits can make the difference between a mediocre campaign with wasted media spend and a truly great campaign.

None of this stuff is rocket science. However, most large brands have massive agencies working on their business that aren’t willing to adapt to the times and most brands aren’t able to work outside those relationships, and/or don’t know what to ask for to get the results they need.

Until brands and agencies can learn to be more efficient and adapt to the new landscape – and really embrace integration of media and creative, optimizing for performance, and influencer marketing they simply will not improve.

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.

Would you rather have one foot in the past or one in the future?

It’s true that, from the looks of it, Cannes is much more fun – you won’t find anyone popping bottles of champagne on a yachs atVidCon. Instead, you’re far more likely to find a few digital influencers, forward thinking brands, agencies, and talent managers huddling around cups of StarbucksCcoffee in some hotel lobby hammering out a few deals.

That said,VidCon is at the epicenter of what is happening within influencer marketing, social media as a whole, and more importantly – what is happening with culture. Digital influencers are the most recognizable celebrities among teens today, becoming a digital influencer is the most desirable job amongst teens today, and the most engaged athlete online is now an E-Sports athlete, the Twitch Streamer, Ninja.

I personally take pride in the fact that while other agencies send execs to the South of France to hear talks, such as ‘What is Innovation”  myself and my team are on the ground working and meeting with influencers at VidCon.

VidCon is where innovation is happening – even the major platforms understand this and make major announcements there. For example, this year Instagram waited until the first day of VidCon to launch IGTV (instead of doing it during the peak of Cannes). Facebook, Snapchat, and YouTube also followed suit making a variety of announcements around platform updates, features, and partnerships onsite atVidCon.

Looking at the ad trades you’ll see that brands and agencies are struggling to capture eyeballs. Ad formats are shrinking and advertisers are having trouble even watching a 6 second ad. Marc Pritchard, the CMO of P & G stated that they “stopped wasting money on 30-second ads, and we’re designing ads to work in 2 seconds,” and that “it is time for marketers and tech companies to solve the problem of annoying ads and make the ad experience better for consumers,”

I agree with Marc that marketers need to solve the problem for annoying ads – but, the reality is the solution exists, and I think if he and his team spent more time immersing themselves inVidCon, and the ecosystem as a whole they’d have the answer already. While P&G is struggling to get ads to work in 2 seconds, people are watching influencer content that is as much as 6 hours long.

According to recent studies long form video content consumption is up 30% over 2017. The #1 Most subscribed YouTuber (PewDiePie) regularly posts 20 min long videos, and the most downloaded podcasts are all well over 45 minutes on average (with some top podcasters like Joe Rogan going as long as three hours).

Clearly attention span isn’t the issue – most advertisers are just not great at creating content and putting it in front of the right consumers.

My team and I at Epic Signal certainly don’t bat 1000, but getting past two seconds is fucking terrible and certainly the exception rather than the rule. Instead, by having an understanding of these platforms, how to work with influencers, and integrate paid media – we’ve seen fifteen minute long pieces of branded content generate 75% completion rates. On a recent campaign with Boost Mobile we integrated influencers into paid social (in addition to having them create their own branded content) and beat the previous CPA benchmark by 50%. The list goes on.

This success comes from us investing a lot of time with these platforms, ingratiating ourselves in influencer communities, attending events likeVidCon (and a lot of trial and error).

I say this not to brag, but to point out that much of the industry is still caught up in the gigantic circle jerk of trying to impress one another with champagne and yachts – resulting in an inability to communicate with consumers.

Just like anything else you’ve got to put in your ten thousand hours – that means spending a little less money on champagne, Rosé, and yachts in France. Instead, why not invest in listening to people who are able to get millions of fans to hang on their every word for hours on end, like you can at VidCon?

End of rant

Some of the major points we covered were:

• Subscription video on demand (SVOD) and YouTube competitors
• YouTubers “making it” on television
• YouTuber revenue streams
• How much money his top creators are making in a year
• How creators can better work with brands, and vice versa

The Confessional is a series of anonymous interview with influencers, brands, marketers, agencies, and MCN executives to get honest, no-bullshit opinions on working in the space — the biggest gripes, the toughest lessons, the most valuable advice.

The following has been edited and condensed for clarity.

You’ve been on YouTube for a very long time. How did you first get started?

I got started back in 2009, and I got started because I actually went to high school with another YouTuber. He’s still got pretty large following to this day.

I saw what he was doing and how we was building a community around himself. It seemed like a huge opportunity. So I started working with him a bit, and I was introduced to other creators and collaborate with them. I was able to turn YouTube into a career in about three months.

How has the community evolved since those early days?

What was really interesting about the early days is that once you hit a certain number of subscribers you were immediately part of the community. People had a sense of respect for you and vice versa. Once you hit that level, you could really approach just about anyone and do collaborations, or just strike up conversations and friendships.

As this community of a few thousand people exploded into the millions of creators you now have today, a bunch of micro-communities developed. Now, it’s like everybody sticks to their own clique. It’s almost like high school. So if you’re a beauty guru, you collaborate with other beauty gurus and you don’t really step outside that.

There’s just not as much cross-pollination as there once was.

I think a lot of the playfulness has disappeared as well. Now, we jump onto each new platform – push our audiences to them (the platforms), and then immediately we ask, “How do we monetize this?”

Speaking of fans, you’ve got a sizable following. What’s it like having fans?

It’s actually really interesting. I rarely use the word “fans,” I’ve allowed myself to use it as of late. This is something that I and a lot of my other YouTube friends struggle with.

We want to be humble, but also want to be respected in the same way that Hollywood celebrities are respected and perceived.  

Do you want to be put on the same pedestal as “traditional” celebrities?

Being labeled as a “celebrity” pigeonholes YouTubers because you can be recognizable without being a “celebrity.” I think it goes beyond celebrity. I think it’s about being a public figure.

There’s a new generation of influence sprouting up as a result of social media. You have people that may be an entertainer-creator or maybe they’re a body-positive influencer. There’s people with influence across spheres — politics, entertainment — you can be an influencer around anything now.

Whatever name we end up giving this new type of public figure, I think they are definitely going to be held to a higher esteem and value than they are today.

How has the perception and attitude towards YouTubers changed among brands and agencies?

The marketers have done a lot to catch up these last few years and they value what we do a lot more.

They’re beginning to recognize that we influencers are not a simple plug-and-play, where they can just say “Let’s put our bag of chips in this,” or “Let’s give them a bottle of water.”

They’re starting to take a step back and invite us in as collaborators. They’re asking what excites us and what ideas we have. It’s becoming a bit more of a conversation than it used to be.

Also, it’s interesting — as demand has increased, you see influencers being represented by four or five different managers and talent agencies. You don’t quite see that in the traditional talent world.

The fact that an influencer can be so freely represented and not be limited to one representative shows me that in some ways the influencer has more negotiating power than traditional celebrities.

I hear from a lot of the creators that “brands don’t get it.” To your point, and in my own experience, it seems as though brands are “getting it” more and more. Do you feel like creators are doing more to adapt and empathize with the brand’s perspective?

Yes and no. You and I have known each other over the years, we’ve seen people come and go.

For the most part, the ones that we’ve seen go are the ones that didn’t develop much business etiquette, or, even just the willingness to put aside some of their stubbornness to be open to some of those brand conversations and feedback.

The ones that have stayed around have been able to have conversations. They don’t just say no to an idea, they offer up solutions.

You have to be able to adapt and work towards a solution where everyone is happy with what they’re getting. It’s only a success if the creator is happy, the audience is happy, AND the brand is happy.

Some creators not willing to put forth the effort, and aren’t open to ideas or build off of ideas that are not their own.

Are you still with an MCN or are you independent?

All my channels are within different MCNs.

The deals I’ve structured are different than what most creators get. They’re in my favor more so than most of the contracts that these MCNs have with the 40,000 other people who signed with them.

What advice would you give to an up and coming creator? What kind of things would you advise them to keep an eye out for?

The first thing to keep in mind is that you’ve got a lot more negotiating power and leverage than you think.

In some cases I get 100% of my revenue. Oftentimes the MCNs will try to offer a revenue split over a certain amount of views. They say, “Hey, look, we did our math and over the last 12 months you averaged out this amount of views. We’ll do a rev-share split of this amount of views over your average amount of views.”

I say no to that because the last 12 months doesn’t mean anything to me. The last three months are going to be the most important numbers to me. And when you go down that math, you’re not going to come to an agreement.

I would also say if you’re going in with an MCN or any other company, you should do it with the idea of getting them to invest in you and your content (whether with upfronts or production support). By having them support you in creating more content, they’ll be invested in your success.

Also, limit your deal to no more than a year in length. Lastly, make sure you’re not just joining

for brand deals. Brand deals are great but you can get multiple managers and agents to represent you to get you those deals.

Where do you see the future of YouTube going? How do you juggle all these different platforms, and does YouTube have staying power?

I feel that YouTube is going to have staying power because of its massive library of content.

Facebook doesn’t have that much content, and I’m not sure if they are ever going to have it.

I think Facebook is similar to what YouTube was back in 2005-2009 — there are a lot more amateur videos and far fewer professional creator videos. YouTube on the other hand has really matured, and is closer to Netflix in the sense that the content has really developed and become more professional.

I feel that YouTube Red is a step in the right direction. And honestly, I think video platforms are going to evolve across the board between Twitter and Snapchat and everything else. We’re going to see different platforms cater to different types of content. I may go to Facebook one day to find a new viral video, but I’ll got to YouTube Red to watch something from a premier independent creator.

How do you as a content creator juggle all of these new platforms? How do you decide where to invest your time and develop an audience?  

It’s actually really natural.

I produce my content with the idea of being able to repurpose it for different platforms. So if it goes up on YouTube, it’s going to go up on Facebook. If it’s going to go up on Instagram it can go up on Vine.

Getting that content distributed across each platform isn’t really hard. I play around with each for a bit and figure out what works.

I took a great deal of interest in Facebook over a year ago and I played around with my content there and it did pretty well. Now I’m playing around with Instagram and it’s doing well there too.

I think people are thinking of their audience as being on every platform. The reality is that if it’s on YouTube, put it up on Facebook too. Put it up on Instagram. Put it up on everything you can. Do a quick edit and cut it down a little bit. Do whatever it takes. The amount of time that you’re going to put into repurposing and customizing content for each platform is going to show a return.

What’s the formula for success on YouTube? What does it take to build a successful channel?

It’s a combination of having fun and being logical. Everything I’ve ever done had to excite me and that doesn’t necessarily mean I didn’t get frustrated with it or I wanted to not do it at some point. You’re going to have speed bumps. But I was very excited to start. Very inspired. And I was very logical. I asked myself, “Okay, how much time am I putting into this? How much money am I putting into this? If this was money, how much money is this of my time? And how quick of a return can I get off of this?”

So when you go from being a personality on camera to investing into content and putting a team behind it, the decisions you make are all about ROI.

So I would say, if you want to be successful, do what you love but put some logic behind it. Put some business sense behind it.

Anything else to add?

The one thing that I will say that I’ve noticed over the years within this industry is that publicly we all say, “Yeah, everything’s all great and dandy.” But, privately you turn to your friend and you’re like, “F this. This does not make sense. This is so stupid. This is terrible. This is horrible.”

We’re all having these private conversations with each other, but we’re afraid to have them openly because we think we’re going to make people feel bad or it’s going to turn into some sort of World War III.

My latest interviewee for The Confessional is a senior advertising agency executive who’s worked on the media and strategy side of the business for over a decade. In this extensive interview, we discussed how the ecosystem has evolved, how much advertisers have (and have not) adapted to working with digital influencers, as well as the newfronts and its role in influencing the flow of ad dollars.

Some of the major points we covered were:

• How the ecosystem has changed over the years
• The best ways to work with creators
• The role of Brandcast and the digital newfronts

How has the space changed since you got started nearly a decade ago?
The biggest change is probably the money.

I remember when I first got started it was hard to get clients onboard with the idea of even paying for YouTubers to create content around their brand. Everything was so siloed back then and, more often than, not they thought of YouTubers as PR and PR should be free.

It was really fucking dumb. Brands would pay millions of dollars in production and media for an agency to create content, but wouldn’t spend any money at all on a YouTuber who actually had a massive audience.

Do you feel like the process of working with YouTubers is more defined today?
It’s getting better. It’s certainly a lot more accepted to work with YouTubers, Viners, Instagrammers, etc. That said, I think a lot of the agencies, creatives in particular, real look down upon a lot of the influencers. There’s a certain arrogance that a lot of agencies have when it comes to anything involving creative.

Regarding, how to work with creators – it’s not really defined. Anyone can work with them any number of ways. The media agencies sometimes do buys and sell through branded content done by influencers as part of the package. Creative agencies and PR agencies sometimes carve out this space as being their domain. It’s not uncommon for brands to have direct relationships.

Also, the way to reach creators to work with them is a clusterfuck. You have MCN’s, talent managers, traditional talent agencies, and the creators themselves all negotiating deals. There’s a huge dogpile at times that creates a lot of confusion.

In your experience, what’s the best way to work with creators?
It depends, there are some great mediators out there who really add value – whether that be a talent manager, MCN account manager, or whatever. It really varies person to person.

However, it never hurts to have at least some access to the source – the creator. That allows you to have a better feel for who you’re working with and what they are and are not receptive to.

The NewFronts are coming up this week – as an advertiser, what’s your take on that?
The NewFronts is the ultimate industry circle jerk.

Upfronts was something created from the Mad Men era when there was limited ad inventory and you had to work with people face to face. None of that is relevant today.

I can buy media cheaper by NOT dealing with the publishers than I can by dealing with them directly. It’s insane. There’s more inventory than anyone knows what to deal with. Why are we, as advertisers, paying a premium? That premium goes to pay for salespeople, bloated organizations and events like those held at the NewFronts.

As a vendor, I totally understand why you’d do the NewFronts. However, brands and their media agencies should be smarter, but they’re not. Why should they be? They can go and be wined and dined by potential partners and then spend the brand’s money. There’s no real accountability to work harder and smarter within a lot of these organizations… in fact, if anything a lot of them are so rigid in their processes you’re better off (career wise) to play it safe and not stick your neck out.

What about YouTube’s Brandcast?
Brandcast is really more of the same. I’d say they do a better job than most in putting on a show and providing tangible insights to help convince advertisers to shift more dollars to YouTube, so in that sense it is good.

However, typically, YouTube is trying to dumb down their offerings for their audience. Once again, I’m not blaming them or the publishers. They’re all REALLY smart to continue to do these events. It’s the brands and media agencies that are dragging their feet that make these events necessary.

Want to get more brands to buy on YouTube? Sell it like TV, like they did with Google Preferred. How fucking insane is that? You need to make things more inefficient to help pull these decision makers into the 21st century. Fucking drives me nuts.

What’s your take on all the attention and ad dollars that have gone into promoting the creators over the years?
Once again – it’s taking an old school approach and applying it to this new medium.

Want to get advertisers to invest in branded content with YouTube stars? Put them on a billboard.

That’s kind of crazy when you think about it. The fact that they were reaching 10 million people wasn’t enough? Fuck. Do you not do any research whatsoever about the media habits of your target?

Any parting thoughts?
Everyone follows the money. If brands evolved and really changed their processes and how they chose work with creators and agencies this could be a much more exciting industry than it is today.

Today, it’s hard to push innovative work through. I don’t think it should be easy, but I don’t think it should be this hard.

So much of this industry is based on legacy relationships and ways of working. These major brands are going to disappear in a few years if they can’t adapt. I genuinely believe that Fortune 500 companies will disappear if they can’t change the way they spend their ad dollars. TV isn’t impactful enough. You’ve got upstarts spending pennies on the dollar in digital to get way more impact.

Brands need to stay hungry and adapt if they want to survive the next few decades.

My latest interviewee for The Confessional is a manager of top YouTube talent. Several of the creator’s in this individuals roster regularly receive tens of millions of YouTube views per month and hundreds of millions per year. In this extensive interview, we discussed the business of YouTube, the goals of this individual’s talent (both on and off YouTube), and the how much money top online video creators are really making. Some of the major points we covered include:

• SVOD and YouTube competitors
• YouTubers ‘making it’ on televisions
• YouTuber revenue streams
• How much money his top creators are making in a year
• How creators can better work with brands and vice versa

(Editor’s Note: The following interview has been edited and condensed for clarity.)

All the big platforms are going to continue to grow as marketplaces, both for integrations and for original content. I foresee Facebook developing its own YouTube Red, and Facebook developing content that they own. Netflix is going to open its doors to YouTube creators because these people are proven at driving digital audiences. People with a track record of driving digital audiences are going to have more and more opportunities, on platforms such as Amazon, Hulu, Go90, and Netflix. That’s where I see big opportunities in the near future.

You’re in a unique position in that you’re seeing both brand deals and entertainment deals. Do you want to talk a little bit about the SVOD deals that you’re seeing?

YouTube Red budgets are very legitimate. And they’re going to be producing really great content. They’re enabling people with creative visions who started out on YouTube to do what they want to do. I think they’ve got a strong chance of succeeding. However, Google is a search company at its core, not an entertainment company, and they’ve stumbled so many times when they’ve tried to dabble in content and entertainment. Like when they gave $100 million out to all those different players, they told them to create YouTube channels and they all kind of fizzled. I feel like that might happen again. If they really want to spend the money then they might as well do it right and buy a proven player like Netflix to be their equivalent of YouTube red. Then they could integrate Netflix into the Google ecosystem.

We got offers from Vessel, but I brought those offers to YouTube and got YouTube to pay us to keep uploading on YouTube first. Facebook has been reaching out and having soft conversations – but they’re not shelling out money for content the way Vessel and YouTube are. At least not yet.

Is the talent you manage interested in making the leap from digital to traditional media? Do they want a TV deal?

Yeah, several of the talent I work with want a TV show. They came out here to be in traditional entertainment and that’s their end game. However, that’s really not the case for everyone I work with. Some of them want to focus exclusively on YouTube. Several of them think YouTube is the holy grail. It’s a platform that’s internationally accessible and free and reaches a massive audience, and you can shop on it. You can talk about a product, put the link in the description, and somebody can click on that link and buy it. There is so little friction between consumer and the product via YouTube.

How are the conversations with TV networks being received so far?

We haven’t sold a show yet, but there are a lot of conversations. The fact that these creators have this loyal and engaged audience, that’s very appealing to the network executives. Broad City started as a YouTube show, Justin Bieber started on YouTube, Workaholics started on YouTube, and Garfunkel and Oates started on YouTube. There are enough case studies at this point of individuals and shows that have moved from the web to TV. But even people who’ve been in the TV game a long time and are really great at it, it’s still like a tough game.

Kurt Sutter, who Sons of Anarchy, just got his show cancelled. He worked on The Sopranos, then The Shield, then Sons of Anarchy. He just started a new show. It was called The Executioner’s Son and it was cancelled after a few months. TV is a tough, tough business. And so, yes my creators have big audiences, but like it’s still a business that you have to try your ass off to get into.

Do your talent want to maintain a YouTube presence even if they get a TV show?

Definitely. They never want to totally abandon YouTube. That is like the kiss of death, if you just abandon your YouTube channel. You’ve got to nourish that audience.

What do you think went wrong with Grace Helbig’s show? That was so short-lived.

If you’re taking somebody from YouTube, where a big portion of the audience may be international or not even have a cable subscription, and then you’re expecting all that audience to magically appear on an antiquated delivery system, then you might be left disappointed.

What kind of revenue are your creators generating in a year?

Maybe like $500,000 to $1 million per creator. My top 5 are generating that much revenue. Of the ten talent I work closely with, I’d say the average is probably $400,000 per year.

Where are your creators generating their revenue? Are there any revenue streams that are working well that you think most people don’t know about?

Merchandise. If you broke down most of my talent’s revenue it’s probably a third adsense, a third brand integrations, and a third merchandise.

What you do think about people who hate on the YouTube stars and say they don’t deserve all the money they’re making?

I look at television at something like Real Housewives. To buy airtime on Real Housewives you’re going to be spending $300,000 for 30 seconds. Is that highly crafted, premium content? Did those people go to acting school or do they have years of theater experience before they were on camera? No. They’re just shows where you just have random people doing their thing. Duck Dynasty has probably one of the most expensive ad blocks on television for years, and this is a random hillbilly family in Louisiana. What do they do that’s so special? So, all of a sudden because somebody’s on a smaller screen and not backed by a TV network they’re not worth those same financial and brand opportunities?

One of the things I’ve heard a lot from creators is “Brands don’t get it!” Often times I agree, but not always. But, on the flipside, do the YouTube creators “Get it”?

Creators have to understand that the moment they take money from somebody you’re going to have to make some compromises. They have to be respectful of what the objectives of the campaign are and how they’re going to achieve them. If you want to play at a higher level, then you have to elevate your game entirely. And that means how you listen to people. You have to be mindful of how you speak to people, how you execute on things. You’ve gotten to a certain point, but if you want to continue then you’re going to need to adapt. A perspective shift is healthy. If you are comfortable with complacency, then you’re not the creator you think you are and you’re not going to be the creator you want to be.