In 2013 everyone wanted to be a full-time YouTuber – in 2019 being a Twitch star is the new best thing.
You are able to make a job replacing income from Twitch and in this, we’re going to breakdown with case studies how the biggest streamers do it.
There are key staples to any streamers income:
- Affiliate links
- Twitch subscriptions
How Do Twitch Streams Make An Income?
In this post, we’ll go through the top 6 methods that streamers use to make an income from Twitch although there are endless ways to monetize a stream depending on how creative you can get.
A common way that broadcasters begin to generate revenue is through donations from viewers.
Streamers can receive donations from their viewers through a number of tools such as Streamlabs and Paypal.
People encourage their viewers to donate to them by allowing the person to interact with the stream directly through their donation. For example, if some donates $X then the streamer will answer a question, read a comment, display their username on screen or even shout them out.
Donations are very common practice and can make up huge portions of streamer’s incomes – DisguisedToast said that he brings in about $2,500 a month in donations from his viewers which is about 13% of his monthly income.
Another way that users can donate to streams is through ‘cheering’ bits. This is essentially another medium to donate money to streamers although to do so you first need to purchase tokens called ‘bits’ from Twitch which you are then able to donate (cheer) to them.
When you convert the donation – 1 bit is equal to $0.01.
The downside of using this to donate is that Twitch will take a portion of the donation. If you buy 100 bits then it will cost you $1.40 – that’s a 40% commission that they’re taking. Although, the more bits that you buy then the commission becomes a smaller percentage of the bits that you purchase.
If a streamer takes donations through a service like Streamlabs then they will receive the full donation amount as it does not go through Twitch.
Subscriptions are one of the main revenue drivers for Twitch streamers.
Subscriptions are an extra that are offered on Twitch that will give the view perks on a streamer’s channel such as special emotes and no ads. Quite often these are promoted by broadcasters with shoutouts when someone does subscribe.
A huge strategy is to encourage users to subscribe using Twitch Prime. This is a program offered by Amazon where if a user has Amazon Prime then they will receive Twitch Prime for free which comes with 1 free subscription per month. This is great because it doesn’t cost the user any extra money if they already have Amazon Prime and the broadcaster can still make revenue.
A subscription without Twitch prime typically cost $4.99 and streamers make $2.50 – $3.50 per subscription that they receive depending on their partner status.
Ad revenue can be another huge revenue driver for broadcasters. Streamers will receive a flat rate for a CPM (cost per mille – 1000 impressions) which will change on the time of year it is. For example, there are a lot more advertisers running ads at Christmas time so ad revenue will increase as more people are wanting to show their ads on broadcaster’s streams.
Ads appear in many places on Twitch which you can see below.
The main way that streamers make money from ads is the pre-roll whenever someone goes to their livestream – usually a 30-second ad will show where the streamer will receive a portion of that ad revenue.
Streamers also have a button that they can click whenever they are in the middle of a stream which will again show ads to their viewers – the more times they hit this button to show ads then the more money they will make.
Although, while they can show endless ads, it doesn’t make for a good stream to have ads ever 2-3 minutes which is why most people use it very sparingly.
Brand deals and sponsorships usually come into play when a streamer is big enough for it to make sense for a brand to sponsor broadcasters.
For example – Hershey’s & Reese’s sponsored Ninja & DrLupo for brand exposure. For this sponsorship, the pair held a 12-hour stream to promote the product. For brands, this is huge as this as the potential reach to their combined 21 million subscribers.
Affiliate marketing is huge and is even one of the ways that this site is monetized (check the footer of this blog).
This involves streamers placing links or giving out codes to their viewers to promote a product. When people go through the link or use the code when they purchase then the broadcaster will get a slice of revenue from that sale. Here is an example of affiliate links in Towelliee’s Twitch box:
The commission changes for different products across different brand and often if a streamer is big enough they will have a personalised commission structure.
By far the most popular affiliate program that streamers join is Amazon Associates. In this program, whenever a user clicks on an affiliate link and purchases a product from Amazon within 24 hours of clicking the link, the streamer will receive a commission on that product. The commission rate for Amazon is standard and can be seen below.
For most products that streamers promote they will call into the PC components with 2.50%. Although, many streamers do promote Amazon coins as they can be used for game purchases such as Hearthstone where they earn 10% commission on all coins that are brought.
How Much Money Do Twitch Streamers Make?
There is no ceiling to how much streamers are able to make – Tyler Blevins (Ninja) makes an estimated $500,000 a month.
Jeremy Wang (Disguised Toast), who is making $20,000 a month, broke down exactly how much and where Twitch streamer’s revenue comes from in an extremely in-depth YouTube video.
Paul Denino (Ice Poseidon) has shown months where he makes over $200,000 a month.
Although, he was banned from Twitch a few years ago and now lives on YouTube with 700K+ subscribers as of writing this.
As much as no one likes the answer – it depends.
If you’re a fresh streamer then you’re most likely going to be earning little to nothing.
Although once you begin to grow an audience then you are able to slowly build your income along with it.
TimTheTatMan is a famous Twitch and YouTube star who has built a mass following of close to 5 million followers across YouTube and Twitch.
His primary sources of revenue are donations, Twitch subscriptions, advertising and sponsorships.
Here is Tim making $4000 in half an hour from donations. Wow.
We are able to do some basic calculations to get an estimate of how much Tim is able to earn from each of his different channels.
Having a look at his Social Blade we can see that he is averaging about 320,000 views a day on YouTube.
The cost per mille (CPM) that creators are paid on YouTube ranges from about $2-$5.
There is a range of factors that influence how much this will be such as content type, advertisers bids on the placements and click-through-rate of the advertisement.
With 320,000 impressions a day on ads he would be making $640 a day with Google Adsense. That’s $230,000 per year if he receives a $2 CPM as well as assuming that there is no channel growth(which is extremely unlikely).
Twitch subscriptions are another huge revenue source for Tim.
Viewers are able to pay $5 a month to be subscribed to a Twitch channel. This will give the user perks such as badges, emotes, engagement in ‘sub-only’ chats and the ability to watch the stream ad-free.
Top-tier Twitch partners earn 70% of the revenue generated from a user subscribing. That’s $3.50 for every subscription.
As of writing this TIm has about 58,000 subscribers – that comes to a whopping $203,000 a month.
Another revenue source that we are unable to estimate is his affiliate earnings.
A lot of Twitch streamers will put affiliate links to products that they use, most often Amazon Associates.
Here is an example of his Twitch panel below to give you an example.
People who use these links will earn a commission every time someone clicks on one of those links and then buy from Amazon within 24 hours.
It’s actually one of the methods that this site makes an income.
Payouts do vary depending on the product and the cost of it but for most Twitch streamers they will be linking computer peripherals.
These typically pay out a commission of about 2.5% which means if someone buys a $1000 GPU then they will earn $25.
There are more income sources where he is also making money such as brand deals where the exact income for these is rarely shared with the audience.
Sodapoppin is another old school streamer who started back in the day with World Of Warcraft PvPs and PvE streams. He has accrued over 285,000,000 Twitch channel views and over 1,000,000 YouTube subscribers. These days he streams pretty much anything from games to mailbox openings.
In 2017 he accidentally revealed that he had been donated $230K+ although that’s not really a surprise seeing that he is one of the largest Twitch streamers out there.
We can also do some basic calculations to estimate he’s monthly income from revenue streams such as ad revenue and subscriptions with a quick look at his Socialblade.
At the time of writing this, he received 3.56 million monthly reviews – with a $2 CPM that is $7120/month from Google Adsense.
He also has 10K+ Twitch subscribers which is roughly $35,000/month for subs.
Similar to TimTheTatMan – there are many other revenue streams that the public will not know as streamers keep these figures undisclosed.