Kids’ content kingpins are making merch to keep the YouTube cash coming

The YouTube channel Cocomelon, which features an animated cast of colorful creatures dancing along to the delight of content-craving kids, racks up 2.5B views a month, making it the 2nd most watched YouTube channel (after T-Series, which features Indian music).

And although Cocomelon rakes in as much as $11.3m per month, the couple-owned company is expanding beyond the screen to sell merchandise and toys to diversify its revenue beyond the all-determining algorithm of YouTube.

The kids want content 

Although YouTube technically bars children under 13 from having their own YouTube accounts, the platform has still become popular among kids who crave YouTube’s kitschy content. And their parents, who can’t get enough of its convenience.

With 72.5m subscribers, Cocomelon is the biggest kids’ channel in the biz. But it’s far from the only large colossal cartoon on the ’Tube. 

There are 5 other kids’ channels with more than 30m subscribers:

  • Like Nastya Vlog: 47.2m
  • Kids Diana Show: 46m
  • Vlad and Nikita: 33.9m
  • ChuChu TV: 31.4m
  • El Reino Infantil: 30.1m

But there was a crackdown on kid-tent 

In January, YouTube was fined $170m and banned from targeting kids with specialized ads (which violates the Children’s Online Privacy Awareness Act).

The law provided kids with new security protections online… and also ate into revenue for big YouTube channels like Cocomelon.

The ad sales of several kid-focused YouTubers fell by 50% to 60%. Cocomelon’s revenue also declined, but its founders wouldn’t say by how much. 

And now, Cocomelon is betting on the magic of merch

To keep the cash coming, Cocomelon plans to start selling toys and musical albums later this year. 

And, further down the road, the company plans to release a full feature-length film.