- YouTube stars like Preston Arsement, known as PrestonPlayz or Preston online, have begun shifting strategies, focusing on long-term bets and different types of content as ad revenue falters due to the coronavirus pandemic.
- Arsement told Business Insider that he had switched his focus to gaming content he can easily film from home.
- Across his nine YouTube channels, his viewership has almost doubled, yet his ad rates on YouTube dropped have by over 50% since the outbreak, he said.
- But Arsement has been selling more merchandise like T-shirts, hoodies, and other branded accessories, which has made up for lost revenue.
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YouTube star Preston Arsement has switched his focus to gaming content he can easily film from home, and has been leaning into direct sales from his merchandise business, as the coronavirus pandemic causes deep shifts in the influencer business.
Arsement's main channel, which has 12.2 million subscribers, is focused on more "real-life content," like challenge videos. These videos require a team of producers, videographers, talent, and social distancing has made it difficult to film new content.
"We did have to stop production on the real-life content for a little bit," Arsement told Business Insider, adding that his team decided to bring back some of his earlier gaming channels now that they are all stuck at home. All new videos appearing on his main channel had been filmed before social-distancing measures took effect, he said.
Arsement, 25, is the CEO of the digital media studio TBNR, which all started from filming gaming videos in his bedroom. Now he runs a lucrative business, which Forbes estimated earned $14 million pretax from June 2018 to June 2019. He earns a chunk of his revenue from the Minecraft servers he runs for seven figures annually and also has several investments in real estate and game development, he told Business Insider in August.
Arsement's company consists of a 24-person staff, including his parents to help him. Since the coronavirus outbreak in the US, everyone has been working remotely, he said.
Arsement isn't the only internet creator to shift strategies. Many Instagram and YouTube stars have begun focusing on different categories of content and long-term bets like direct-to-consumer businesses as influencer marketing campaigns get put on hold and ad rates drop.
Arsement launched new 'experimental channels' while at home
Arsement's top YouTube channels are Preston (12.5 million subscribers), the Minecraft-focused PrestonPlayz (5 million subscribers), and his other main gaming channel TBNRFrags (5.4 million subscribers). Over the last few weeks, he also launched a few new "experimental channels" for more gaming videos, he said.
Across his nine YouTube channels, Arsement's viewership almost doubled last month, from 310 million views in February to 550 million views by the end of March, he said. Even the channels he hasn't uploaded new content to are seeing a spike in views.
Hours watched on YouTube gaming content went up 10.7% in March, according to data from Streamlabs.
Arsement creates "family friendly" content across all of his YouTube channels, which he believes has also played a role in his viewership.
"I think diversifying the content and allowing it to be more evergreen so anybody in the household can find it entertaining is a solid strategy," he said. "Not only do you appeal to more brands at that point, but also more members of the household."
Merchandise sales have made up for a loss in ad revenue
YouTube creators like Arsement earn money a number of ways, including direct-to-consumer sales, brand sponsorships, and revenue earned directly from YouTube.
YouTube pays creators a rate for every 1,000 views on videos monetized with ads, called the CPM rate. This rate changes based on factors like viewer demographic and content, among other things.
Arsement said his CPM rate has dropped by over 50% since the coronavirus outbreak began, but merchandise sales have made up for that loss in revenue, nearly tripling in that time.
Direct sales can stabilize an influencer's income in a time when advertising revenue decreases. Other creators in categories like fitness told Business Insider that recently they have been leaning into DTC program sales.
Arsement runs his merch business in-house and has a warehouse where he ships T-shirts, hoodies, and other branded accessories, which he sells online through the e-commerce platform Shopify. This is a different set-up than some other top creators, like David Dobrik (16 million subscribers), who sell merchandise through a company like Fanjoy, which handles all of the distribution and production.
"It's a great time for people to double down on merchandise and if they don't have it yet there are plenty of great companies they can partner with to start getting something out for summer," Arsement said.
In 2017, Arsement began working with the digital talent management firm Night Media and said that having a team behind him has largely contributed to his quick rise in numbers. The firm helps creators like Arsement develop brand relationships and work with companies like Disney, Nickelodeon, and Nestlé's Hot Pockets for longer-term deals that extend for a full year.
Over the last few weeks, some brands have put campaigns on hold, Arsement said, while others related to gaming software have continued to run deals.
"It's been awesome to see that some of the brands are still really hungry during this time and are trying to advertise on our content," he said.
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