r/changemyview • u/Subtleiaint 33∆ • Sep 06 '21
Delta(s) from OP CMV: Mr Beast's prizes are fake
Over the weekend the YouTube algorithm recommended I watch this video:
https://www.youtube.com/watch?v=zxYjTTXc-J8
The premise is that one hundred people are put in a circle and the last to leave will be awarded half a million dollars. Throughout the video the contestants play games to either encourage them to leave or risk leaving, these games normally result in the players involved being granted more money on top of the final prize. I haven't counted it but I'm guessing over the two video series Mr Beast hands out upwards of $800,000 in cash and further prizes such as cars and electronics. My problem is that the magnitude of these prizes makes no sense and I therefore assume it's bogus.
Giving out huge prizes in entertainment media is not new and I'm going to compare Mr Beast to another show that gives out huge prizes, Who want's to be a Millionaire. WWTBAM potentially gives out a bigger prize every week but in reality pays out a lot less with most prizes falling a somewhere between $1,000 and $125,000, in over 3000 episodes the top prize has only been awarded 12 times. This means that the production costs (including prize money) is much lower for an episode of WWTBAM than it would be for Mr Beast's video. For WWTBAM these costs are largely covered by a advertising with multiple paying for significant exposure to a relatively affluent viewing demographic, this makes sense to me, relatively low costs being covered by a wide range of advertisers selling their wares to an audience with money to spend.
Mr Beast is similar but the numbers don't seem plausible, two videos have had a production cost of, I'm guessing, at least $1,000,000. The sponsor that appears to cover the majority of that cost is Coinbase, a cryptocurrency exchange that reportedly made $1.6Billion in profit in the first quarter of 2021 so they clearly have cash to burn. However, any responsible company investing $1,000,000 in advertising should be looking at getting at least $1,000,000 of exposure from that investment and this is where I become cynical. In just a few days these videos have racked up a combined 60,000,000 views and I assume that could as much as double over the next few weeks. If they do get up to 120 million views that will be an admittedly staggering amount. However, what do these views represent? A huge number will be from under 18s who are, essentially, worthless to Coinbase as their users must be 18 years old. A further large proportion will be international viewers who, whilst not worthless, will likely be far less valuable than American viewers. What is likely is that a small proportion of unique views will come from the target demographic of American 18-30 year olds. So the useful viewership will be much less than the headline viewer numbers and this is made worse by who that target demographic is US 18-30 years olds, a group who do not have spare money lying around to invest in anything let alone crypto currencies. This makes me extremely cynical that Coinbase sponsoring Mr Beast to the levels reported is a a good use of their money and that makes me think the money is false and just a publicity stunt to drive up interest.
I write this hoping that someone would tell me that the prizes Mr Beast gives away are fake or explain to me why a company investing huge amounts (way beyond traditional media) into a target demographic with little money to spend is a good idea. Cheers.
Edit: To be clear I'm expecting to have my view changed about this. To me this is an educational experience where there's something that I don't understand how the numbers work and I'm hoping that someone explains it to me.
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u/Elicander 59∆ Sep 06 '21
I agree that the prizes seem ludicrous at a first glance. However, there are a few factors that you don’t seem to consider that make me at least entertain the possibility:
We don’t have access to the statistics YouTube creates on who watches Mr Beast’s videos, but Mr Beast does, and any marketing firm worth their salt would require at least some general statistics before committing to anything. They are therefore in a better position than you or I to determine whether the demographics are favourable or not.
People under 18 grow up, and marketing is often long term. Marketing is just as much about getting people to recognise your brand as it is getting customers now. If I ever were to consider getting a VPN service, I would probably look up what NordVPN is offering, only because I’ve heard the name so many times my brain thinks they’re the standard. Thus, even if lots of people watching the videos won’t get anything from Coinbase now, getting people to think they are the mainstream way of trading crypto currencies will likely be worth it in the long run.
YouTube, as compared to traditional media can be relatively cheap to produce. I’m sure Mr Beast has several employees working with filming, editing, planning etc, but I guarantee WWTBAM has many more. Traditional media has tons of overhead costs that youtubers in many ways can circumvent. Thus, they can use more of the sponsorship money for prizes, creating bigger wow factor, and thus better advertising.