You’ve likely heard of the growing number of “millionaire millennials”, a wave of internet-savvy youngsters earning money from streaming games and influencing social media. Older generations are rather perplexed that teens with blue hair and cat-ears are making a full-time career out of gaming.
Really, it all boils down the certain business fundamentals, and in this article, we’re going to explain exactly how game streamers earn and maximize their revenues.
The various ways streamers earn revenue
You might think that kids are simply earning money playing video games, but there’s actually a lot more to it. There are games that actually give you money, and you can accrue a small income from these. On a larger scale, however, game streamers earn the majority of their revenue from:
- Twitch subscribers
- Donations from Paypal and Patreon
- Affiliate marketing
- eSport earnings
In many ways, a successful game streamer is building a personal brand, like a celebrity. This is why many game streamers are known as influencers because their voices reach a wide audience across social media channels. People have come to hate traditional forms of advertising, but if a popular game streamer mentions a product, surely it must be worth checking out.
Game streamers just starting out will often request donations from viewers. This doesn’t happen overnight though, so a new streamer may go several months without any donations. Others may start to see a few hundred dollars per month trickle in, such as reaching Twitch Affiliate status. Reaching Twitch Partner status on the other hand can earn a game streamer several thousand dollars per month.
The Twitch platform allows viewers to subscribe to streamers, and then shares a portion of revenue from those subscriptions, as well as advertising and bits revenue, with the streamer. The amount shared with the streamer depends on different levels of account status, such as Twitch Affiliate and Twitch Partner mentioned above.
Twitch offers three tiers of subscription – $4.99, $9.99, and $24.99. Thus, you might think there is clearly an incentive for Twitch streamers to offer content at the three different tiers, but T3 subscriptions are actually relatively rare on Twitch. Because of the percentage that Twitch takes, streamers would rather that their fans donate via Paypal or cryptocurrency, rather than subscribe past a T1 membership.
How gamers earn money outside of Twitch
With that being said, game streamers cannot rely entirely on Twitch for revenue if they’re concerned about split-sharing with the platform, so many game streamers build themselves as social media influencers.
This way they’re able to earn even greater amounts of money by endorsing products, and rarely do they need to put their face in an ad. Often they’ll simply briefly mention a product while streaming to their audience.
As a game streamer’s popularity grows, so will the size of companies sponsoring them. So in the beginning a game streamer might be sponsored by a small game app or VPN software company. When a game streamer’s popularity reaches an audience of millions, so will their revenue. The Twitch streamer ‘Ninja’ earned $1 million from Electronic Arts’ for helping to promote Apex Legends across all of his media.
For streamers that participate in competitive eSports, they can also win cash prizes in tournaments, which are funded by sponsors, and they can take a salary for being a member of an eSports team as well.
Smaller eSport competitions can offer prizes of several hundred or thousand dollars, while the most popular eSport competitions can go into the millions in prize money. Thus, a competitive game streamer would build a following touring the smaller competitions, picking up Twitch subscribers along the way, and possibly enter the big leagues.