Sub revenue share cuts, ad increases, what’s next??
A lot of the recent changes at Twitch have started forcing streamers to reevaluate the ways in which they monetize content and present it to their viewers.
These changes are mainly where Twitch will:
1) Cut the revenue share on subscriptions
Some partners had negotiated terms of a 70 / 30 revenue split for subs, which is now being reduced to 50 / 50 after the first $100k. While it might sound trivial to some, this is a significant portion of income. Although, fortunately, it won’t take place until around June 2023.
To help streamers “recover” this portion of earnings, Twitch implemented the second change –
2) Shift ads from a fixed payment model…
per 1,000 ad impressions to a “percentage-based revenue share model,” which gives streamers 55% of revenue for every ad they run.
It’s already a constant battle for streamers to run ads and this change just goes against the overall culture of Twitch. While many viewers understand why streamers run ads, it still doesn’t help improve the viewer experience.
So what do you do as a streamer when you take a paycut on sub revenue and are told to make it up by running more ads (and potentially chase away viewers)?
I saw this firsthand at Twitchcon in San Diego where these concerns just echoed.
For example, according to Jake’n’bake, the President of Twitch is extremely out of touch (as you might be able to tell from the blog post here too).
From a “tone at the top” perspective, what does that mean for Twitch and its creators?
I’m only one person, and I don’t work for Twitch, so I’ll leave the speculation out.
What these changes tell me is that, if you haven’t already, as a streamer you need to focus even more on DIVERSIFICATION.
In my world as a financial planner, diversification is a topic beaten into the ground related to where you invest your money, as well as how much you allocate to each type of investment.
But it’s so much more than just choosing the right place to save money.
Overall, the theme here is “don’t put all your eggs in one basket.”
I mean, sure, everyone knows that…right? But how do you actually do it in your business?
By creating multiple income streams & monetizing on multiple platforms.
Monetizing on Multiple Platforms
I think back a lot to my previous career as an auditor, and when we would analyze a company’s revenue it was a big red flag if a company earned the majority of its revenue from one client, customer, or product.
Why?
Because if that one source decides to buy elsewhere, goes out of business, or just doesn’t want your product anymore, your business is in trouble.
Same thing with Twitch – as a streamer, if all of your income is earned from one source you might need to seriously look at additional ways you can monetize.
Take this tweet related to the new ads program, for example:
Even partners are saying that without multiple streams of income, these changes on Twitch (which you, the creator, have no control over) could potentially mean the difference between a comfortable career vs. struggling.
How I Can Help
As a content creator and a self-employed professional, you want to make sure you and your business are protected from the uncontrollable things.
The final question I have for you is, what if you don’t start diversifying today?
Like we’ve seen recently, many changes that platforms make to their monetization & payouts to creators are out of the creator’s control.
Don’t let changes creep up on you.
I help creators focus on what you CAN control by reviewing how and where you’re monetizing, and creating a plan to diversify your income between multiple channels. I also help you diversify the money you save, like I mentioned earlier with investments.
By being proactive, you’re insulating yourself from being immediately impacted by changes on a platform or in the overall economy.
If you’re ready to start or improve on diversifying your channel, grab a time to chat with me for free here!
