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Youtube Brand Deals, Sponsorships and Ads explained

Youtube Brand Deals, Sponsorships and Ads explained

There’s a lot of confusion over the ways that youtubers make money online and exactly what they should be disclosing to their audiences. Whether you’re a consumer that wants to know what’s going on, or a youtuber that wants to know how to stay on the right side of things then this should help you out.

The general rule is that if a creator has some kind of incentive to be showing or talking about a product, service or company, whether it’s financial, receiving something for free or getting some kind of benefit then they should be disclosing that to the audience.

What is an Ad?

The most important thing to understand is when does something become an ad. The simple answer is when there is some kind of incentive on the creators part AND the brand has some kind of control over the content. Control can range from being as extreme as determining the exact content and script of a video, to simply requesting to see and approve the video before it goes live. Many people assume that the incentive for the creator is money, but it doesn’t need to be cold hard cash, it could be free products or services, it could be a discount, it could be a trip somewhere or some opportunity, incentive doesn’t always mean money.

If those two requirements are met then the content, or the portion of content about the product/service is considered an ad and needs to be disclosed.

Let’s go through the various scenarios in the order that creators are likely to get the deals as they grow.

Affiliate Links

Affiliate links are generally nothing to do with a brand reaching out to a creator, it’s usually the creator that has signed up to an affiliate program and chooses to give those links to their audience to use. The creator earns a small percentage of money when a viewer clicks on the affiliate link and goes on to make a purchase on that website. Some affiliate links are pay per click which means the user doesn’t need to actually go ahead with the purchase they just need to click the link. Sometimes the affiliate links will give a discount to the viewer using that link as well.

While that’s the usual deal with affiliate links, there are certain companies that will give creators special affiliate links for products as part of a promotional run.

Affiliate codes are pretty similar, but when a user clicks the creators link or goes to the website they need to enter the affiliate code themselves and are usually treated to some form of discount.

Creator Note

Affiliate links usually don’t come from direct association with a brand so how you deal with these is really down to the you. You can choose to promote certain items that you have codes for if you want to, but that would be outside of the brands control entirely.

Is it an Ad?

Nope. Brands have no control over the video content involved with the affiliate code/link.

Disclosure

There is a lot of conflicting information about the exact details of disclosure but ultimately, yes. You should be disclosing that the link you have is an affiliate link and you will be earning a commission on any sales made with that link. For example:

The links marked with a * are affiliate links and I earn a commission if you click on the link and make a purchase.

Don’t hide away your disclosure either. It should be really easy for people to see, and they should be able to see the disclosure before they click on the links.

The Freebie

Freebies are where a company contacts a creator offering to send them something (or provide them a service) for free. This can come in two forms, the free freebie and the not so free freebie.

The Free Freebie

A free freebie means that the company is sending the creator a product with no strings attached. The creator has no obligation to show that product to the audience, to talk about the product, nothing.

Creator Note

If you’re a creator and you get sent a free freebie then make sure you are very clear that you are not obligated to do anything. Usually in the brands dealings they will suggest that you use the product in a video, or talk about it in some way and it’s the creators responsibility to make it clear that you may or may not do that at your own discretion.

Is it an Ad?

This is not considered an ad because of the brands lack of control over the content.

Disclosure

Currently you do not need to disclose that you received the item for free seeing as the company has no involvement with what you do with your freebie once it’s received. However, if you do decide to include it in a video then for transparency it’s best to mention that it was sent to you.

This is likely to change soon seeing as there has been a massive surge in PR packages being sent to creators. Top creators tend not to get sent a couple of bits and pieces as freebies but instead are receiving freebies that would cost thousands if they were to have paid for it themselves. To be on the safe side it’s best to disclose that you received the item for free, but were under no obligation to include it in a video.

The Not Free Freebie

Sometimes brands will reach out offering to send a free product or service, but in exchange they want something. Usually a review or for it to be used in your video in some way (like a product placement – see below).

Creator Note

As a creator you want to be really clear about what exactly you are agreeing to so that you can fulfil your side of the bargain, and to make sure that you are comfortable with whatever it is you’re supposed to be doing. Usually with a free product a company isn’t going to be too demanding and they’ll just want the freebie mentioned, used or shown in one of your videos.

Is it an Ad?

While you’d think that a free product wouldn’t be able to turn into an ad, that’s not the case. If the brand has any kind of control over the content you put out then that turns it into an ad and it would need to be disclosed as one. By control that could mean that they tell the creator what to say, or the restrict the creators ability to give their own honest opinion, or they want to review the video and approve it before it goes live, or they determine the topic or content of the video in some way. Basically if the brand has any control whatsoever beyond the basic agreement of it being included in a video in some way then your freebie has become an ad and you need to disclose it as an ad.

Disclosure

Even if your freebie hasn’t crossed into ad territory, you should still be disclosing that you received the freebie in exchange for something (a review, inclusion in a video, etc). Basically, because a creator has agreed to do something in exchange for the freebie the audience needs to be aware that the decision to include that product or service in a video was influenced by the company, the creator may not have included it if they weren’t under obligation.

{The product/service} featured in this video were sent to me for free by {the brand} in exchange for my review, but all opinions are my own.

The Product Placement or Feature

Product placement or features are usually similar to not free freebies except there is some money or other financial incentive involved in exchange for the product being featured and usually some kind of message about the product being given. But, because it’s a product placement or feature the entire video is not based on that item, the bulk of the content of the video is the creators own and just a small portion is dedicated to that product.

Sometimes a brand will also require that something specific is said about that product, so instead of it just being used or shown the creator will need to talk about it or give some kind of message to their audience that the brand has determined.

Creator Note

Like with the freebies it’s important to be very clear about what exactly you are agreeing to do in exchange for the products. If the brand wants you to deliver some kind of message about the product make sure you make them aware that you are willing to deliver the message but that you will make it clear in the video that the message is from the brand itself, not you.

Is it an Ad?

This is classed as advertorial if the brand is giving you some kind of message to deliver, or has any form of control over the video or the portion of the video where the product is featured.

Disclosure

Because the bulk of the content within the video is the creators own content without any control from the brand the entire video doesn’t need to be labelled as an ad. But, the portion of the video where the creator is talking about the product should be disclosed as an ad. Creators are free to choose how they disclose it, either verbally before they start talking about it, or by displaying something on the screen so that viewers are aware that the portion of the video they are currently watching is an ad.

Just disclosing it in the description box is not considered enough. But having a note in the description box along with the disclosure within the video is a good idea.

Ad Break

An ad break is where the creator makes a video of their usual content but at some point during the video they are being paid to promote something. For this to be an ad there needs to be that control from the brand, otherwise it might be a sponsorship instead – see below.

Creator Note

Make sure you understand the difference between an ad and a sponsorship as both need to be disclosed differently.

Is it an Ad?

It’s only an ad if the brand has control over the content in some way.

Disclosure

If it is an ad and it is only for a portion of the video (so the rest of the video is your own uncontrolled content) then you don’t need to label the entire video as an ad. Like with the product placement disclosure you’ll want to make it clear to your viewers before you start talking about the product or service that you are being paid to do so and it is an ad.

You might want to also include something in the description box saying that that portion of the video is an ad just for transparency with your audience.

Sponsorships

Sponsorships is what makes the whole Ad Break scenario a little murky. Basically a sponsorship is where a creator is getting some kind of help to make a video like financial help, products, services etc. But the sponsoring party have no control over what is being made.

Usually the creators will give a nod to the sponsors to thank them for sponsoring the video, and if they choose to they can encourage their viewers to go to the sponsors website, promote their products, say nice things about them, but it’s entirely up the creator if they want to do that or not.

Creator Note

You’ll want to be really careful making sure you’re clear on whether or not you are being sponsored or whether it’s an ad so that you can disclose it the right way. Make sure you are clear in your communication with the sponsoring party what exactly the deal is, what your obligations are and whether or not it is truly a sponsorship or an ad. Ultimately, if it’s a sponsorship the sponsor should have no control over the content of the video.

Is it an Ad?

Nope. So long as the sponsor has no control over the content of the video it’s not an ad.

Disclosure

Sponsorships should be disclosed as sponsorships not as ads. This can be done by telling the audience during the video, especially if the sponsoring party are going to be mentioned. Usually the creator will simply say thanks to blah-blah for sponsoring this video… and then go on to give some information about the company if they choose to.

You could also include a line in the description box that mentions that the video is sponsored and who sponsored it.

The Ad

An ad is similar to a TV ad, so essentially a brand is hiring you to promote a product or service. Again, hiring doesn’t necessarily mean they are paying with cash, although usually that is the case for ads.

Ads have a lot of brand control over them and can be almost a collaboration. Usually, the brand will want a video that is in the same style as the rest of the creators content, but for the video to be geared around the product, service or brand that they want promoted.

Basically, the brand has some form of control over the content, and the entire video is about whatever the brand is paying to have promoted.

Creator Note

If you start getting offers for full blown ad videos then you’ll want to be very careful about whatever you are agreeing to. Usually these are going to come with contracts so instead of it just being email agreements it’s signing on the dotted line and being totally bound by the terms you are agreeing to.

Is it an Ad?

Yes. 100%.

Disclosure

Because the entire video is considered an ad you need to disclose it somewhere where the viewer can see it before they choose to watch the video. Either place the word AD near the beginning of the title so it can be easily seen, or in the thumbnail so it can be clearly seen.

Ethics

Getting involved with ads, sponsorships and brand deals come with it’s own set of ethical questions and they’re ones that you really need to spend some time thinking about. While we all like to think that if these kind of opportunities came our way we’d only engage in these money making ventures with brands we love, time has shown that that’s not always the case. There have been plenty of cases of creators being caught advertising products that are just plain bad, or trying to sneak advertisements past their users by not disclosing them.

Before entering into any kind of deal make sure that the brand you are working with are not asking you to do anything that you feel is unethical like asking you to not disclose it as an ad, or trying to exercise control over what you say (for example preventing you from giving your real opinion if it’s negative).

For a lot of newbies to the ad world when you get your first offer it can be tempting to jump on it whatever it is purely because it can take so long to get to the point where you are earning any money. But, trust me, once you start getting offered deals more will be coming your way. There’s really no need to enter into an agreement that you are uncomfortable with, or to promote a product that you don’t like just for the money. Ultimately, if you do that you’ll start to lose the trust of your viewers before you’ve even begun which will take it’s toll on your future ad possibilities.

Contracts/Agreements

I’ve mentioned how careful you need to be when negotiating agreements or contracts with brands, and there are few things that you really should be looking out for. Even if you are agreeing everything by email, be aware that while it might not seem as official as a signed contract you can still find yourself in trouble if you agree to something and don’t deliver on it.

If you want to find out about more about this then I’ve put together a separate post going over some of the things you’ll want to watch out for when agreeing to or negotiating brand deals.

Good Luck

For any of you that are dipping your toe into the world of making a little bit of money in the youtube world, congratulations!

If there’s any form of advertising/sponsoring/brand stuff you think I’ve left out let me know in the comments section and I’ll come back to add it in.

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