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[Latest] Explanation of YouTube Shorts Monetization and Production Mechanisms
YouTube is a video-sharing platform used by many people. Until around 2019, most videos were horizontal. However, with the rise of vertical videos like TikTok, YouTube introduced the vertical video format called YouTube Shorts in 2020.
Companies are increasingly using YouTube Shorts as part of their marketing strategies.
In this article, we explain the differences between regular YouTube videos and YouTube Shorts, the monetization mechanism for YouTube Shorts, and how to produce them.
What is YouTube Shorts?
YouTube Shorts is a service where you can post short videos up to 60 seconds long. Oversea, it started in 2020, but the service began in Japan in July 2021.
It is characterized by vertical videos optimized for smartphones, and since the video duration is short, it is easy to enjoy.
YouTube Shorts is an explosively growing content worldwide, with view counts in 2023 increasing to about twice that of 2022.
Below, we explain the features of YouTube Shorts.
Features of YouTube Shorts
In YouTube Shorts, you can upload and watch vertical videos up to 60 seconds long within YouTube. You can watch Shorts by launching the YouTube app and tapping the dedicated Shorts tab.
Because you can deliver videos to viewers other than those subscribed to your channel, it's possible to introduce your channel to a wider audience.
First, start by letting viewers know what content your channel uploads and the overall impression of your videos through YouTube Shorts. If they get a sense of your channel and become interested, it can lead to watching long-form videos and channel subscriptions.
Also, all stages from filming to posting YouTube Shorts can be completed on a smartphone. Previously, filming required a camera and editing required specialized tools, which had the disadvantage of making video production time-consuming. However, with YouTube Shorts, everything from filming to posting can be done entirely with a smartphone, and since the video length is short (within 60 seconds), it's easy to upload.
About YouTube Shorts Monetization
Next, we will explain the monetization of YouTube Shorts videos.
In conclusion, you can earn revenue from YouTube Shorts just like regular videos. Previously, advertising was not introduced to Shorts videos, so they could not be monetized. However, with the revision of the YouTube Partner Program in February 2023, Shorts videos can now be monetized as well.
Below, we explain the mechanism and requirements for Shorts monetization, as well as estimated income.
The Mechanism of YouTube Shorts Monetization
While YouTube Shorts can now be monetized, we will explain how the mechanism works. Since there are several steps until monetization, it's important to understand the process before creating videos.
Aggregating Ad Revenue
First, all ad revenue generated from Shorts videos is collected in one place called the Creator Pool.
Deducting Music Licensing Fees
Next, music licensing fees are deducted. Many Shorts videos use music, and when ad revenue is aggregated into the Creator Pool, licensing fees are deducted from videos using music.
If no music is used in the video, the licensing fee is 0 yen. If one song is used, 50% of the ad revenue allocated to the Creator Pool goes toward the licensing fee. If two songs are used, 66% goes toward licensing fees.
Music licensing fees are determined by the number of tracks used in the video, as described above.
Allocating Rewards from the Creator Pool
Ad revenue collected in the Creator Pool is distributed to creators who have monetized their content. The share of revenue you receive is determined based on the ratio of your video views to the total monthly Shorts video views.
For example, if your uploaded video accounts for 3% of the total Shorts views for that month, you will be allocated 3% of the Creator Pool revenue.
However, please note that you do not receive the full allocated amount. The final revenue will be explained next.
Payment to Creators at a 45% Revenue Share Rate
A 45% revenue share rate is applied to the earnings that creators receive. For instance, if you are allocated 10,000 yen from the Creator Pool, your final payout will be 4,500 yen.
Conditions for YouTube Shorts Monetization
Now that we've explained the mechanism, let's look at the requirements for monetizing YouTube Shorts. There are three conditions:
- Have at least 1,000 subscribers
- Have at least 4,000 valid public watch hours in the last 12 months, OR 10 million valid public Shorts views in the last 90 days.
- Strictly comply with YouTube's monetization policies and guidelines.
These are the three requirements. The monetization conditions for regular YouTube videos and Shorts are essentially the same.
During the review process, YouTube also checks whether the channel follows monetization policies and guidelines and if the videos are suitable for advertisers.
Keep in mind that YouTube's monetization requirements may change, so it's important to check the official YouTube site periodically.
Revenue Per View for YouTube Shorts
Revenue per view for YouTube Shorts is said to be around 0.003 to 0.01 yen. Since regular YouTube videos earn about 0.05 to 0.07 yen per view, the revenue for Shorts is significantly lower.
While Shorts have the appeal of being easy to create and having the potential for high view counts, there is a large gap in revenue rates compared to regular videos.
How to Monetize YouTube Shorts
To monetize YouTube Shorts, you must meet the monetization conditions and agree to the YouTube Partner Program terms and the Shorts Monetization Module.
The Shorts Monetization Module refers to the terms you must agree to if you want to earn ad revenue from Shorts and revenue from YouTube Premium.
Shorts revenue begins from the date you agree to both. Please note that views gained before agreeing to the terms are not eligible for Shorts revenue.
Tips for Producing YouTube Shorts
Up to this point, we've covered monetization. Now, we'll explain tips for actually producing YouTube Shorts. We'll focus on three key points to keep in mind.
Decide on Video Theme and Target
First, it's crucial to decide on the theme of your short movie and your target audience. Defining your target allows you to create a short movie optimized for them. For example, if you're targeting business people in their 30s and 40s, focus on more formal videos or business-related themes.
Include an Opening that Makes People Want to Keep Watching
For the opening, include a presentation that captures interest and makes viewers want to see more. YouTube Shorts tend to be browsed quickly by swiping. If you don't make them think it's interesting in the beginning, they will move on to the next video.
Initially, we recommend mimicking the structure of videos you usually watch and have liked or commented on.
For example, you could start by answering a viewer's question with the conclusion first, then explain the details in the latter half. A structure that leads to a closing that makes viewers instinctively want to comment is also worth considering.
The longer the watch time, the more likely the video will appear in recommendations and related videos, leading to more fans for your account.
Resize Horizontal Videos into Vertical Videos
If you have a channel primarily focused on regular videos and want to direct viewers from Shorts, resizing existing horizontal videos into vertical ones is one way to create Shorts.
There are two main methods for resizing.
One is to crop parts of the video you want viewers to focus on into a vertical format. The other is to use the horizontal video as-is and insert images above and below.
In practice, you often see horizontal videos that have had a specific segment cut out to create a vertical version.
Add Captions and Subtitles
Adding captions and subtitles makes your video more viewer-friendly. This is because you should account for viewers who are watching in silent mode.
Short-form content like YouTube Shorts is often viewed during gaps in travel time, so many people watch without audio. If they don't see something interesting right away, they swipe.
Depending on the tone of the video, some content may not need captions if it's purely visual. However, if audio is necessary to understand the content, we recommend adding captions to ensure they watch until the end.
Give Postings a Consistent Feel
Maintaining consistency in the videos you post to your channel is also a tip for Shorts production. Viewers may check your channel's video list if they liked a specific Short. If they find many similar videos when they look, they're more likely to subscribe.
3 Examples of Corporate YouTube Shorts Use
Finally, we'll introduce three case studies of companies utilizing YouTube Shorts. Please use these actual examples as a reference for your own Shorts production.
1. Shiseido
Shiseido Co., Ltd.
This is the official YouTube channel of Shiseido.
They introduce CMs for each brand, corporate advertising, beauty technology, and more. They use short movies to promote products by showing them in use. Promoting through an official corporate channel rather than an influencer can give viewers a sense of security.
2. Rakuten
This is the official channel provided by Rakuten Securities.
They post short videos answering questions about NISA savings guides, new NISA, and new savings NISA.
The Shorts guides concisely summarize which operations to perform to proceed or register within a short time frame.
Because YouTube Shorts can reach so many viewers, there's a high demand for videos summarized in a short time.
3. TV TOKYO Official
This is the official YouTube channel of TV TOKYO.
They post various content videos including bonus program footage, press conferences, and exclusive announcer VTRs.
Specifically for TV-related content, they post digests or highlight scenes as Shorts to make it easy for viewers to transition to the main full-length video. The goal is to increase program viewership by linking from official clips to the main content.
Tomira for YouTube Shorts Production and Operations
If you want to outsource from production to operations of YouTube Shorts, Tomira is recommended. While you can consider in-house production to keep costs down, increasing subscribers requires marketing knowledge. If you lack marketing expertise or want to prioritize quality, outsourcing is the way to go.
Tomira can handle everything from short movie creation to social media account management. If you want to use Shorts for your company but are worried about a lack of know-how or effective strategies, you can leave it all to Tomira.
Common concerns include:
- No time for video production
- Not sure about video trends that appeal to Gen Z
- Don't know what kind of content to post
- Can't think of video stories
- Lack of video editing knowledge or skills
- Followers and subscribers aren't increasing, so it's not leading to sales
- Want to improve existing social media accounts
Tomira can solve problems like the ones above.
Main Features:
- Reflects the latest trends that appeal to Gen Z
- Handle account management along with movie production
- Careful creative production
- Managed by social media specialists
- Precise strategies to approach the ideal target
- Creative production tailored to trends
Companies looking to grow through center-focused short movie social media operations should consider outsourcing to Tomira.
Summary
YouTube Shorts is a service watched by a wide age range, centered on Gen Z. While viewers can quickly swipe to the next video, impactful content has the potential to be seen by many in a short time. YouTube Shorts allows you to promote your products and services while also enabling monetization.
If you're looking to start a YouTube channel or have one but haven't tackled Shorts yet, please use this article as a guide to create and post your own. If you're anxious or have concerns about production and posting, we also recommend outsourcing to Tomira.
Use the case studies introduced here as a reference and why not focus on YouTube Shorts?
