Successful streamers make their money by taking advantage of multiple streams of revenue at once as opposed to relying on one income channel.
In this post, I’m going to cover some of the different types of monetization methods available to the average Twitch streamer.
Subscriptions are the bread and butter of a streamer’s career.
Ask any broadcaster whether they’d prefer more donations or more subscribers and they’ll answer with the latter. That’s because you can consistently track your earnings and provide a rough estimate as to how much money you can expect next month. This helps when planning a large commitment such as a mortgage or financing a new car.
In order to earn subscribers, broadcasters must first become a Twitch affiliate. Twitch streamers typically make $2.50 per tier 1 ($4.99) subscription however larger streamers have been known to negotiate a slightly larger cut based on the volume they attract.
Streamers will also unlock more custom emote slots for their chat to use as they gain more subscribers, which is why donators are opting to gift subscriptions as opposed to their cold hard cash.
Viewers with an Amazon Prime subscription can also benefit from one free Twitch subscription per month, which streamers will still receive 50% of any normal subscriptions value.
Bits are the virtual currency of Twitch. You have to be a Twitch affiliate to receive them.
Viewers can purchase quantities of Bits in order to donate to their favourite streamers with the added benefit of their message being highlighted either in the chat, on screen or both.
Bits were created to provide viewers with an alternative method of donating cash. As streaming was a relatively new segment before the invention of Bits, streamers had to rely on the likes of Paypal for their donations.
The major downside to Paypal was that scammers could charge back their donations. Lots of streamers lost out on money and in extreme cases landed themselves in overdraft of their Paypal account, which can incur charges. As a result, Bits are a much safer way for a broadcaster to receive a donation, though a lot of progress has been made in this area of Paypal since then.
Streamers earn one cent per Bit donated to them, so unlike subscriptions where the streamer would earn 50%, Bits add the incentive for viewers to be able to fully support broadcasters.
Whilst viewers must purchase Bits, they can also be earned (albeit very slowly) by voluntarily watching ads. You can do this by clicking on the Bits icon in the bottom right corner of the chat (make sure you don’t have an ad blocker installed) and click the “Watch Ad” button. This will net you 5 Bits per ad watched.
Not every streamer likes to run ads as they significantly interrupt the viewing experience and run the risk of losing the viewers that don’t want to watch them.
Streams based around mass views such as the League of Legends channel will focus mostly on running ads because viewers have less of an incentive to subscribe.
A common middle ground strategy used by streamers to attract more subs yet still run ads is to offer no ads for subscribers.
Others choose not to run ads at all in order to maintain their concurrent viewers as much as possible.
Twitch are constantly experimenting with the way in which ads are presented, but like all online video platforms, they’re going to be around forever.
A large portion of viewers simply want to show their support by donating via Paypal, Streamlabs or Cashapp as the cut is smaller.. This is typically what non affiliate/partnered streamers rely on in order to keep streaming, improve their content and of course… eat.
You’ll really only see sponsored streams ran by Twitch partners, but that’s only because they have already reached a point where they attract brands looking to advertise with them.
A sponsored stream typically consists of the broadcaster playing the advertisers game or hosting a giveaway on the advertisers behalf. For example, Pokerstars have very recently been sponsoring streamers to use and play their online Poker platform on stream, or when Sea of Thieves was released, Amazon themselves sponsored streamers to play the new release.
Typically in an agreement like this, you’ll have to stream the game for an amount of hours set by the advertiser, sometimes over the course of a few days.
Sponsored streams usually come with a few rules attached to them, with the most prominent rule being no swearing.
Advertisers want to advertise in areas which are aligned with their brand goals and won’t damage their reputation.
Equally, they don’t like to see you endorsing a competitors product either, like recently when partnered streamer Jericho lost a huge brand deal with McDonalds for making a tiny slip-up.
Sponsored Social Media Posts
A lot of the success behind streaming lies behind the actual broadcasting itself. Networking and social media is an enormous element of the streaming lifestyle and streamers with large social media followings are targeted by brands who are looking to promote their product.
You can tell if a social media post has been sponsored because it’s a legal requirement for influencers to clearly state that they are being paid, this is is usually done by using the hashtag #ad or #spon.
You’ll mainly see sponsored posts on either Instagram or Twitter, these are two of the most popular social media platforms for streaming (assuming you don’t count YouTube) and it’s in the interest of any growing streamer to promote their own handles as this type of advertising is all about the numbers.
Sponsored YouTube Videos
Ever had an interesting video interrupted by an obnoxious advert for a mobile game? Of course you have. There’s an obscene amount of money in this, as mobile gaming is one of the most accessible (and largest) market in the entire games industry.
Much like sponsored social media posts, this type of advertising is also a numbers game, so as a streamer it’s important to upload videos to YouTube to keep your online presence expanding.
Fairly straightforward, merchandise is a great way for fans to support their favorite streamer and get something for their money as opposed to simply donating it.
Merch comes in many different forms:
- Phone Cases
Most of the streamers that dabble in their own merchandise are obsessed with making sure the quality is high, they are putting their reputation on the line after all.
To dip your feet in the water with your own merchandise, having your own Streamlabs storefront is a good place to start.
Look below any streamers feed and you’ll see a bunch of different panels pointing towards their social media pages, a bit about themselves and more importantly, the brands they are associated with.
There are hundreds of different affiliate schemes open to streamers. Each offer a commission on each item sold as a direct result of the broadcaster.
The most common affiliate scheme is Amazon Affiliate, whereby streamers usually post links to the gear they use in their streaming setup, such as lighting, peripherals and hardware.
If you were to click on one of their affiliate links, a cookie will be placed in your browser for 24 hours. If you purchase the item, the streamer will receive a small percentage of the products value when the product is delivered, so if you cancel or refund your order it won’t count.
A scheme offered directly from Twitch themselves is their Game Sales program. This used to be exclusive to Twitch Partners but it’s now available to Twitch Affiliates. It’s marketed to viewers in the form of an on-screen overlay or a call to action button below the stream when broadcasters are streaming that particular game. Streamers will receive a 5% commission per game sold.
Finally, another way streamers can earn affiliate revenue is by having a discount code. Pretty much any E-Commerce brand will offer this – the most common on Twitch I’d say is G Fuel.
Every time a purchase is made using a streamer’s discount code, they’ll get a cut. Some schemes are even more generous, whereby just clicking on your affiliate link is enough to earn you a commission, even if they used an entirely different discount code which nets a larger discount.
Tournament Prize Money
Whenever a tournament becomes available to streamers who selectively stream only one game, entering tournaments will provide fresh new content and offer a chance at winning either a grand prize or a podium.
Obviously, E-Sports athletes stream in order to supplement their competitive tournament based lifestyle, but for the sake of the average player, let’s look outside the likes of the LCS.
Games with a large Twitch presence like Fortnite, PUBG and Old School Runescape each have their own tournaments. Without them, there wouldn’t be as much variety, but they also give the opportunity for lesser known streamers to gain some fame if they perform well in the tournament.
That Red Bull fridge is there for a reason. Product placement isn’t usually a temporary gig, advertisers want viewers to see their product over a prolonged period of time.
Most commonly though, you’ll see this in the form of small banners on Twitch overlays.
Okay, this is a little bit tongue in cheek but still technically correct.
Gaining a large presence on one platform can attract the interest of another looking to grow their viewer base. Just look at some of the people who have made the move over the past year.
Ninja moved from Twitch to Mixer.
Shroud moved from Twitch to Mixer
DisguisedToast moved from Twitch to Facebook
The broadcasters are paid to move in various ways, some are offered a contract and must stream X amount of hours per week / month / year. Others are simply offered a lump sum.
If you think about it, if you grew to be a massive streamer but had made your money and wanted to retire early, taking a payout by moving platforms (which nukes your audience size, by the way) is an effective way to start your exit strategy.