The YouTube Formula. Derral Eves

There is so much money to be made in so many ways on YouTube, but even more, there is so much power in influence. I can show you how your influence can make a big difference.

      In Part III, I dissect the YouTube Formula for content planning, creation, execution, distribution, analysis, and adjustment. I teach you how to find your audience, speak to them, and convert them into your own loyal community. I teach you the importance of traffic sources so you know where the viewers come from and how you can get your content seen. I help you read metrics graphs so you can recognize data patterns. Your YouTube success depends on developing these skills, so get ready to learn and embrace them.

      I've helped countless YouTube channels tap into growth opportunities they could not see on their own. And I've helped creators and brands learn the steps to get views, make money, and build businesses. If you follow the Formula and open your mind to the opportunities I am going to show you, you can get the results you've always wanted on YouTube.

2 The YouTube Ecosystem

      In order for us to understand how YouTube really works, first we need to look at how it operates as a digital ecosystem. A digital ecosystem works much like a natural ecosystem: there are a lot of moving parts, and all of those parts affect the organization as a whole. Grade‐school science taught us about energy flow in a natural ecosystem; photosynthesis, plants and animals, decomposition, and nutrient conversion are all part of the cycle. Every factor in the chain has its job to do, and if it doesn't work right, it affects the entire operation.

      YouTube's ecosystem also has a flow and cycle, and its contributors affect the whole, for better or for worse. This digital ecosystem includes the creator, the viewer, the advertiser/brand, copyright holders, multichannel networks (MCNs), and YouTube itself.

Here's a quick summary of how the YouTube ecosystem works: creators make videos and upload them to YouTube. Brands pay YouTube to run advertising alongside uploaded content, either before or during a video. When a channel meets the ad sharing program requirements, it gets a cut of the money from the ads running on their content. Brands also connect with creators who they think will be able to increase brand awareness and/or their bottom line. This influencer marketing is a huge part of YouTube's ecosystem. The viewers come to interact with content, creators, and communities. They watch, subscribe, comment, like and dislike, save, and share. YouTube as a website is the host of the ecosystem, but as a company, it's a part of the ecosystem. YouTube the company has to make sure everyone in the ecosystem is satisfied. They field complaints and legalities. They ultimately make the rules, but the rules evolve over time based on feedback from the ecosystem and what needs to be addressed. MCNs played an important role in the beginning of YouTube, connecting brands with creators and managing other elements of the creator experience. They also helped try to problem‐solve because YouTube didn't have the creator support at the time. Creators don't have to work with MCNs; they can manage their own channels and deal directly with brands or work with agencies to connect with brands. Finally, copyright holders want their original work attributed to them without being stolen or copied. They want to keep any financial benefit from that content coming back to their original content.

      To be a part of this digital ecosystem, understand the role each contributor plays, especially the role you intend to occupy. For example, if you are a creator, become familiar with YouTube's guidelines so your content can get monetized and stay monetized. Don't steal or copy someone else's content, but if you intend to use clips of scenes or songs or any other copyrighted material, know how to go about it legally. Your content's success depends on your understanding your role in the ecosystem. Your YouTube experience should be more than starting a channel and uploading videos. In fact, if this is your methodology, your video will never reach viewers. YouTube rewards original content that's made for a specific audience, so if you learn the system and follow the rules, your videos have a greater chance of being seen.

Beware of Copyright

      The first consideration in the ecosystem should be the viewer. If nobody is coming around to watch, the rest of the ecosystem is dead in the water. When YouTube was new, the viewers were a fairly specific demographic because the content was fairly specific. People were uploading personal videos to share with their friends and family, so there was an audience there, but where the viewership really had the potential to grow pushed in the entertainment direction. People were uploading clips from TV shows, movies, comedy bits, and the like. Viewers were also coming to find clips from popular culture and the news. It was easy to upload this stuff, and it was easy for the viewers to find.

      From 2005 to early 2007, YouTube users had been uploading content generally unregulated and unsupervised. This included a lot of original content, sure, but it also included protected content that had been created by another person or company. Obviously, this was a direct infringement to the copyright holder of that content.

      It's important to note here that YouTube users weren't doing this sneakily or maliciously. They just wanted to share things they loved, and it was so easy to do. Do you remember Napster from the turn of the century? For those of you born in the 2000s, let me tell you a story.

Imagine a world where you couldn't listen to your favorite music on demand. The only way to hear your favorite song was to sit by the radio all day, waiting. If you wanted to listen on demand, you had to buy the entire album that included the one song you wanted to hear. Then along came Napster. Napster was the original widespread file‐sharing platform. Like, the pioneer of all digital media sharing on the Internet. Audio files, mostly songs, were shared as MP3 format files, and anyone could download any file for free. FREE! This was huge for music fans all over the world—the people loved Napster. Who wouldn't want unlimited access to their favorite bands for exactly zero dollars? Well, I guess not quite everyone was a Napster fan … namely, anyone who should be making money from music sales.

      If you don't know the rest of the story, I bet you can guess what happened next. Lawsuits. Shut down. No surprises here. Actually, just before Napster was created, Bill Clinton, then‐president of the United States, had signed the Digital Millennium Copyright Act (DMCA) into law in 1998. The DMCA has regulated digital copyright issues and reinforced offender penalties ever since. (However, websites hosted outside the US are regulated by the United Nations World Intellectual Property Organization (WIPO).) What happened with Napster set the stage for media sharing regulation from that point forward.

      YouTube could have looked at companies like Napster as examples of what not to do, and implemented their Content ID system from the time they opened up shop in 2005, but they didn't. In March 2007, a little company called Viacom, along with several others, sued Google and YouTube for $1 billion worth of copyright infringement issues. Reuters reported that YouTube was only taking copyrighted content off the site after a copyright owner had requested it, but there was nothing being done on the front end to prevent that content from being uploaded to begin with. Further, the lawsuit claimed that YouTube knowingly let this happen because they were making money on all that content.

      The Content ID system wouldn't be implemented until 2007, the beta in June and full rollout in December. The ID system would attach a unique “digital fingerprint” to new uploaded content. Content could then be tracked and measured against already existing copyrighted content so YouTube could catch infractions.

Now that the law had been involved, YouTube had to settle some things for copyright holders. First, they literally had to settle that hefty lawsuit (the terms of settlement were undisclosed), but they also had to settle how they would proceed from there, and the Content ID system was the answer. I can't stress enough how monumental this was to YouTube's success. YouTube likely would have followed the fate of the original Napster and been shut down if the Content ID system hadn't been implemented, and a lot of creators and businesses like you and me would be doing something else. It was a total game changer.

Ad Revenue Sharing

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