A Brief History of Social Media
Social media has become used by almost everyone in some aspect of their life, and along with that huge amount of use among the population comes new ways of doing business, marketing ideas, and ways to make money.
Social Media itself is a very broad term, and can also be used to describe social networking, but some scholars define the 1970's as a period of significant development in the concept of social media. In the 2000's, there was a huge boost of social media sites popping up. These were the years of MySpace, LinkedIn, lastFM, and many more. Facebook came onto the scene in 2004, the very same year as Napster.
How do these companies profit?
The entire point of a social media companies existence is to make money. There is very little overhead for employment, as social media companies have relatively few employees compared to their overall userbase.
Social Media companies primarily make their money through businesses using their platform, and paying for that use. Examples of this can be marketing, advertising, sales, customer service, and support. The social media market is broad and this can mean different things depending on the platform.
Even in countries where Facebook is not used, in fact it is blocked by the government in China, social media has a huge presence. China has the largest internet user base in the world at 649 million, and it also has the most active envrionment for social media, meaning that the users simply 'do' more social media than users in other countries.
Mobile vs. Non-Mobile
Snapchat is just one example of mobile-only social media. Designed to be an application that has 'disappearing' photos and videos that can be quickly shared with many people. SnapChat does not currently have any desktop applications. Even so, they have a huge presence in the market, and fill a role that is otherwise left untouched by other forms of social media.
The Bottom Line
Miller at al. describe social media and its integration with human life:
'[Social Media] has grown to be seen as such an integral part of everyday life that it makes no sense to see it as separate...[t]hey have given us potential for communication and interaction that we did not previously possess.' Miller et al.
The industry is incredible profitable, competitive, and growing fast. With the rate that technology changes, and the way that people are discovering new ways to take in media, we can assume that this field will continue to grow and be a competitive market.
Interestingly, social media companies have failed to find other streams of revenue outside of advertising. Given this information, we are sure to see incredible innovation and a huge increase in the types advertising presented to users
All forms of social media make money, and we examine a few companies in detail here.