In 2020, 60% to 70% of 9-year-old YouTuber Ryan Kaji's $30M annual revenue came from merchandise licensing deals, passing YouTube ad revenue for the first time
Bloomberg : Tweets: @efeng , @business , @grady_booch , @business , and @lucas_shaw See also Mediagazer Tweets: Eric Feng / @efeng : “The most successful YouTube operations see ad revenue as a diminishing proportion of their overall business. The YouTube influencer merchandising boom has been growing for several years.” YouTube is a commerce giant hiding in plain sight. https://twitter.com/... @business : 9-year-old Ryan Kaji's YouTube empire makes $30 million in annual revenue. This year, most of it came from merchandise, not ads https://www.bloomberg.com/... via @BW Grady Booch / @grady_booch : Let's be clear: Ryan is the product and the brand, promoted by his parents. https://twitter.com/... @business : Nine-year-old Ryan Kaji is one of the most popular YouTube creators in the world, with a main channel that's drawn 29 million subscribers. That means big money for his growing empire. More @BW : https://www.bloomberg.com/... (via @Quicktake) https://twitter.com/... Lucas Shaw / @lucas_shaw : Ryan's World is one of the 50 biggest YouTube channels in the world. But it now makes 60-70% of its money off of YouTube thanks to 100+ licensing deals for shoes, toys and TV shows. https://www.bloomberg.com/... See also Mediagazer
Context & Ripple Effects
Ryan Kaji topped Forbes' list of YouTube earners in December 2019 with an estimated $26M in annual earnings, so Bloomberg's new figure extends a known trajectory rather than breaking one. What changed in 2020 is the composition: 60-70% of his ~$30M now comes from merchandise licensing, overtaking ads for the first time.
The shift tracks the wider kids-content playbook — Cocomelon was already moving from its ~2.5B monthly views into merchandise expansion months earlier — and YouTube itself reported that the number of creators no longer ads-dependent grew 40% between January and May 2020 (Bloomberg). Eric Feng's framing in the piece: the most successful YouTube operations treat ad revenue as a diminishing slice.
First-order effects
- Ryan Kaji and the Ryan's World operation now earn more from licensing the brand than from the platform that built it — YouTube becomes audience acquisition, with Amazon and other retail partners capturing the monetization.
- YouTube's economics with its biggest kid-facing stars weaken: the channel with top billing delivers less of the ad revenue that justifies its promotion.
Second-order effects
- Cocomelon and other large kids channels face pressure to replicate the licensing-first model or accept that view counts alone no longer translate into comparable earnings.
- Retail partners and toy licensees gain leverage in creator deals — the scarce asset shifts from subscriber reach to brand extendability onto shelves.
Third-order effects
- If the pattern holds across top creators, YouTube's role structurally repositions from media business to top-of-funnel: ad rates matter less than how reliably a channel converts attention into licensed products sold off-platform.
- Creator valuation would increasingly track merchandising IP strength rather than ad CPMs, changing which channels attract investment and what YouTube must offer to keep them exclusive.
The trend: Top YouTube creators are flipping their revenue mix from advertising to off-platform commerce, converting channels into licensing brands with YouTube as the customer-acquisition layer.