Let’s face it, if you’re reading this article then you certainly aren’t the top dawgs of Twitch or Youtube. You’re here looking for advice and not to hype you up on a dream for insane sponsorships that the top 1% of Twitch streamers make. It’s a different game for us little streamers and competition is fierce. Stay informed of the sponsorship meta on the ground level.
Here are some valuable facts going into 2023 about sponsorships and brand deals for content creators and how to best set yourself up for the ever-changing trends. The information shared within this post are insights stated from various talent agencies who work closely with marketing executives of commercial brands.
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Sponsorship Industry Trends for 2023
Ending 2022 and coming into 2023, the current trend appears to be that the entire sponsorship industry is leaning out and tightening the purse strings. What was once a grand open spending spree from companies pouring money into content creation events is now drying up and becoming a small brook. Here are some important statistics to be aware of:
- Influencer ad spending is down about 50% from recent years
- Conversions on paid products/services are down as much as 70%
- Niches focusing on consumer topics (lifestyle, beauty, fashion) are seeing less interest due to the downward swing economy
In other words, sponsorship budgets for this year are going to remain down due to companies tightening up their budget and running leaner.
For example, in 2021 the average CPMs were $30-$40. Now going into 2023, the same CPMs are averaging $15-$25. We are certainly not flourishing right now as we once were.
Why the downward trend?
There are many factors going into downward trends for influencer ad spending.
Covid-19 Lockdown and Work-from-Home
A big one could be getting over the Covid-19 era. We were all stuck at home during the lockdown and work-from-home directives and, therefore, spent much more time online on social media and the advertising companies took advantage of this by slamming ads in front of our eyes.
Now that communities and companies are opening back up and pulling people out of their homes back to the normal work cycle there are fewer viewers on social media during the day. The pool for potential buyers of the ads is now removed and companies are noticing their ad campaigns are no longer as effective – hence reducing ad expenditure going forward.
Impending Recession Economy
We’ve been hearing it for years – we are overdue for a recession and it has to be coming. Inflation is also at an all-time high, driving consumers to be smarter with their money and hold back on impulse buying.
The way the world currently is, coming out of Covid-19, money is tight. And that holds true for companies and businesses too. Companies are downsizing left and right with massive layoffs and business travel is on the decline with record airline ticket prices. The supply chain is all messed up with long lead times on goods that once were easily obtained.
Companies are looking for all ways of cutting operational costs and running leaner than in previous years. And with that, the ad marketing budget is reduced.
Which niches are still in high demand?
With all trends, there are still strong performers and new losers. Here are a couple of high-valued niches that are still pulling in strong sponsorship deals for video content creation.
- Do It Yourself (DIY)
- Educational Information
- Tutorial Walkthroughs
- Business Growth
Creators who create ad ideas that are outside of the box are being picked for sponsorships at much higher rates. Being unique truly does promote your pull when dealing with sponsorship. Sponsors want the biggest bang for their buck and will be more motivated to do business with somebody who has an audience pool’s focus all to themselves.
When it comes to Twitch and YouTube, channels with an on-camera personality presence tend to have 3 to 4 times better conversions than channels without one (faceless/camera-less).
Things to Avoid when Negotiating Sponsorships
Many brands are refusing to sponsor anyone asking over $10,000 and would rather go for multiple smaller creators instead to split up the money. The trend is to now hire a group of content creators rather than just 1 or 2 larger creators for an ad campaign.
So be mindful that you may be passed up for being too big in some cases, especially if you are hard-struck for a high paycheck from them. This could also harm future sponsorships with the company too. Build a working relationship that will bring long-term monetary value, rather than a one-time high-pay opportunity.
Gaming Niche Topics to Avoid
Any game that has a child-related audience playing it. Most family games geared towards children playing them are blacklisted by most brands.
Minecraft, Roblox, and other child-related content are simply poor choices for companies to invest in an ad campaign in. These game niches have seen terrible returns and most marketing executives refuse to touch them. Very few sponsors will bend this rule anymore.
If you think about it, why advertise to a child or young adult who has to then go and ask their parents to buy them something? The sale simply isn’t there. Most content creator sponsorships are about building hype and persuading viewers into quick impulse buys based on emotions and possibly a small discount code. Parents still stomp that out quickly when they are asked to pull out the credit card.
Things You can do to Grow Sponsorships in 2023
Make sure your channel about page is well written and thoroughly explains what your channel is about and the audience it is for. Sponsors and agencies use tools that search Twitch and YouTube for keywords to find channels for their campaigns.
If possible, GET ON CAMERA. It’s literally a statistic.
Be more flexible and understanding of budgets going into this year. Instead of turning a sponsorship down for a low payout, try to instead negotiate to offer less work.
For example, offer a 45 seconds ad instead of a 60-90 second one, or have the ad be later in the video instead of the first third of the video. Negotiate to remove any usage rights, to remove exclusivities, or even remove any viewership guarantees.
Offer a Package Deal
Offer a lot of other types of services to attract a higher bid opportunity. Such as publishing an ad on YouTube Shorts, IG post, TikToks, Twitter Posts, Blog posts, and a newsletter.
If you do not have any of these, build them, diversity is your reach as a content creator and the key to building your brand, not just obtaining sponsors.
Outreach Yourself for a Sponsorship
Find an agency or multiple agencies that work in your niche and inquire about joining their client list that they send out to sponsors. I would recommend only picking agencies that will represent you non-exclusively.
Do not partner with any agency that takes more than the standard 15% to 20%. If much higher then they are just scamming and legally robbing you for being new and learning the game.
Here’s an honest hint about what to do. See what brands are sponsoring other channels in your niche in the last 30 days. Write a short and direct email about your interest to work with them to promote their product or service, and make sure to select a specific product and tell them how you would incorporate it into your content and how many viewers you expect to see the ad promotion.
For example, you can pitch a video you’re about to publish and you can work in this event to talk about and show this product/service. And state the budget that will make it possible to produce that said video. The crazier and more out of the box the idea, the more likely you will get approved. It’s also smart to mention some other content creators similar to you IF AND ONLY if you see that they have sponsored multiple videos of that content creator too.
Also, if you have an extremely niche channel, try to average at least 5,000 views per video bare minimum before even looking at the bottom-of-the-barrel sponsorship opportunities. And that is only for sponsors in your niche. If you look for any other sponsor that is not exactly in your niche then you’re more looking at 50,000 views per video as almost the bare minimum for getting considered. Ideally, you will require 100,000 views per video to start getting decent opportunities, but the sweet spot is 500,000 views per video to have more pull for better deals.