Making Money on Twitch

Making Money on Twitch
 

What is Twitch?

Twitch is the world's leading live streaming platform for gamers.

You don't need to log in if you want to watch people from around the world play your favorite games, but creating a free account will allow you to connect directly with your favorite streamers or broadcast your own content live.

Twitch also offers advanced subscription options to unlock bonuses and free play rights in certain games, and allows viewers to support their favorite streamers.

Twitch boasts an astonishing number of viewers, about 1.1 million people per day and over 4.5 million streamers per month. The platform has grown over 60% each year for the past two years and is forecasted to continue its growth.

Twitch is in a growth phase, meaning new streamers entering the scene have plenty of opportunities to earn real income from their favorite games.

Part 1: How to make money on Twitch

There are many different ways to make money on Twitch. First, let's analyze the income of the top 2 most famous streamers on Twitch: Ninja and Shroud.

Ninja (or Richard 'Tyler' Blevins) is the number one streamer on Twitch currently, earning over $5.5 million annually from live streaming Fortnite and other popular games. However, to achieve this income, you will need to have over 12 million subscribers (the number Ninja currently has).

Here is an estimate of the money Ninja earns:
- Subscribers: nearly $4 million
- Ad revenue: > $500,000
- Bit donations: > $300,000
- Average sponsorship: $600,000
- Estimated average revenue on YouTube: $36,000

The second highest-earning streamer is Shroud, with around $3.3 million annually, broken down as follows:
- Subscribers: > $2.3 million
- Ads: nearly $200,000
- Bit donations: nearly $58,000
- Average sponsorship: $600,000
- Estimated average revenue from YouTube: $36,000

As you can see, the majority of income comes from subscribers and sponsorships. They both make up a large percentage of Twitch streamers' income.

A. Subscribers (Twitch Partner Program)

The number one source of income for Twitch streamers is based on the number of subscribers.

On Twitch, viewers can choose from 3 subscription levels: $4.99, $9.99, and $24.99. As a streamer, you will initially split the subscription income with Twitch at a 50/50 rate. As you become more popular, you will earn a higher percentage, up to 100% in some cases.

One advantage of subscription-based income is its regularity. You will earn this amount every month, helping to maintain stability and not be broken in any month.

However, you must be invited to join the Twitch Partner Program to increase the number of subscribers. And, with only about 12,000 Twitch partners while there are over 1.7 million active streamers, this is not an easy feat.

B. Bit Donations

When starting out, the amount of bits viewers donate will be your main source of income. 'Bits' are virtual currency on Twitch that viewers can purchase and use to send animated emotes, called cheers, in a streamer's chat.

These animated emotes, called 'Bit gem,' when used by subscribers in your chat, Twitch will pay you $0.01 per bit.

Streamers can also create their own custom emotes, called 'cheernotes,' which function similar to bit gems but will have a different appearance (this feature is only available to Twitch partners).

C. Advertising Revenue

According to CNBC, the average Twitch streamer earns $250 per 100 subscribers from advertising. Like cheernotes, this is exclusive to Twitch partners.

Twitch offers standard IAB (Interactive Advertising Bureau) scroll ads and display ads. They pay streamers based on a CPM (Cost per impression) model - you get paid after 1,000 ad views.

It's important to note that advertising revenue has significantly declined due to increased ad blocking, but you can combat this by directly asking viewers to disable ad blockers when live streaming.

D. Paid Live Streams and Sponsorships

Once you've connected and built relationships with companies looking to advertise their products, you can receive sponsorship money from them to advertise for them through live streaming, wearing merch, and using their products on camera.

For example, if we look at Ninja's stream, we'll see him advertising for Bud Light and DXRacer chairs, both companies have paid Ninja to do this.

Another form of sponsorship is paid live streams, where game developers pay streamers to live stream a specific game and introduce it to a larger audience in the hope that more people will use the game.

E. Affiliate Marketing

Affiliate marketing is simply advertising a product or service and providing a discount code for viewers. Whenever someone makes a purchase using your discount code, you will receive a commission or a fixed fee.

For example, you really like the gaming chair you're using, and you've arranged with the manufacturing company for them to provide you with some discount codes. You then share these discount codes with your followers. Whenever someone uses these discount codes to purchase the chair, the manufacturing company will have to share a portion of the profit with you.

This is also a form of sponsorship, but instead of just showcasing the product, you have to actually get users to buy it. If you have a large following, affiliate marketing can be more profitable because you can earn more commission than sponsorship.

Of course, this will depend on the commission you earn and the actual number of purchases, so you will have to closely monitor the numbers. Affiliate marketing is one of the first ways you can make money on Twitch without becoming a partner of the platform.

F. Join an Esports Organization

Did you know that the average salary in the esports industry is $60,000 per year? Top esports players can earn between $1-3 million per year.

Although this income does not come directly from Twitch, showcasing your live streaming skills will help you get noticed and sign a contract with an eSports team.

This is considered a long-term measure. However, when making income from Twitch your main profession, any method will be long-term for the streamer.

Part 2: How to build a viewer community to profit on Twitch

After understanding the different methods of making money on Twitch, it's time to get started.

Similar to writing blogs or advertising on media, making money on Twitch also requires building a dynamic and engaged viewer community.

To earn a continuous stable income on Twitch, you need to have about 500 viewers at once. This means you need about 500 actively watching viewers for most of your channel's live streams.

Here are the specific steps to build a viewer community to profit on Twitch:

1. Plan of action

Before creating a Twitch account, you need to plan a specific course of action. To stand out among millions of other streamers, you need to determine what your strengths are.

For example, you could:
- Become exceptionally good at a specific game
- Be a notable entertainer
- Use advertising gimmicks to create buzz (like discussing politics while playing a game or something else unique)
- Build a personal relationship with viewers (calling them by name, asking about their lives, ...)
- Teach viewers how to play better and explain your decision-making process.
- etc.
- Ideally, combine all of the above.

Now, before you start promoting your channel, determine what you want to do.

Do you want to use Twitch as a full-time job or just as a hobby? Can you stream for over 8 hours a day, 5 days a week, and more? How long can you try before giving up or deciding to go all-in?

Take the time to seriously think about this, as your answer will determine your level of effort, whether you can succeed, and your approach to viewers.

2. Promote your content on multiple platforms

Once determined to become a streamer, this is when you need to act. I'll remind you again, you have to stand out among other streamers, so you'll need to learn how to advertise and create a unique identity.

There are many different channels on the Internet to advertise your content. Google, YouTube, and Facebook are the top 3 most visited websites. Reddit, Twitch, Instagram, and some other social media channels are also worth using.

Your goal is to make people choose your content among billions of other things on the Internet. This is not easy, but it's what you need to do if you want to become a high-earning streamer on Twitch. However, don't let this affect your mentality, as understanding marketing means you're ahead of about 80% of streamers on this platform.

Develop a strategy to promote your channel on various websites, such as:

Live stream a tutorial with a popular game (like League of Legends, for example)

Record that and upload it to YouTube, try to optimize for YouTube search and related videos. Don't forget to mention in the YouTube video that you also live stream on Twitch and provide a link to your Twitch channel.

Engage in forums (Reddit, Quora, ...) and look for questions related to the game you just made a tutorial video on. Answer these questions and link back to the YouTube video you uploaded. Do this on various forums.

Share your YouTube video on social media platforms like Facebook, Instagram, Twitter, ..., tag those who watched your live stream video and ask them to share.

Do you know what you need to do? There are many different ways to promote your content. The key is to always try to learn and dare to think and do. You can read anything you want, but experience is the best teacher.

3. Connect with other organizations and streamers

Essentially, one of the best ways to become wealthy is to build relationships with those who are already successful.

This holds true for Twitch. The more relationships you have with partners and successful streamers, the more beneficial your live stream channel will be.

You can expand your relationships in the following ways:
- Collaborate with other streamers on mutually beneficial terms
- Play games with other streamers and live stream at the same time
- Partner with organizations and advertise for them for free, and in return, they also have to advertise for you.
- ........

If you only want to operate in a specific field, connect with partners and streamers in that field. If you can befriend Ninja, your sales will skyrocket, even if you're not the best player or the most entertaining.

4. Stay Consistent

Plan your live streams weekly and commit to this plan seriously. Viewers will eagerly anticipate you during these times. And if you lose consistency, you will lose the trust of your viewers. This is especially important when you consider this as your main job, your main source of income.

One last thing....

At some point, you may feel that what you are doing is meaningless. This is completely normal because essentially, you are an entrepreneur and the journey of an entrepreneur is like this:

When working hard but seeing no benefits, you may doubt yourself and your choices. 'Am I kidding myself? How can I possibly do this?....'

Never listen to such negative thoughts.

You can do this, you deserve it, and you are just trying to rationalize everything so you won't get hurt. But when you have these thoughts in your head, it's time to regain your spirit and double your efforts.

It may take you 6 months, 2 years, or even longer, but you can and you will if you keep trying.

Exploring Other Income Options

If your primary goal is to earn extra income while playing games, then Twitch is the right choice.

However, if you are looking to make money or build a business model, then Twitch may not be the perfect choice.

Like a multi-level marketing platform, only a small number of streamers can earn high income. The majority cannot earn a reasonable income when considering streaming as a full-time job.

There are many other options for success; you can research online or seek the support of experts to make the best decisions for your career. You can also learn more about how to make money on Facebook here.