Technical Brief

Social Media: How they make Money, Market and Share.

One of the most popular and used website application types is social media. "Social media is the collective of online communications channels dedicated to community-based input, interaction, content-sharing and collaboration."(Rouse,2016). Social media allows people from all over the world to communicate, share and network with each other. Smart phones today allow users to download social media apps so they can access any social media they want at the click of a button. Being able to access these different Medias gives people knowledge and information. Social media can provide knowledge regarding jobs, shopping, friends, family, sports, or anything else that you may be interested in. "Websites and applications dedicated to forums, micro blogging, social networking, social bookmarking, social curation, and wikis are among the different types of social media."(Rouse,2016). A lot of people may wonder how social medias make money if they are free for users. How social medias are used for marketing? These questions are common and will be answered in this brief.

According to WordStream, "Social media marketing, or SM, is a form of internet marketing that involves creating and sharing content on social media networks in order to achieve your marketing and branding goals."(WordStream). Social media marketing can be a vital source of a business if used properly. To be successful businesses need to connect with the desired group of people, or the desired market they want to be in. There also needs to be a goal in mind, without a marketing goal, how can there be successful marketing at all. "The goal is usually to create content compelling enough that users will share it wit their social networks."(Rouse,2016). For example, LinkedIn is used in the business world almost as a social business resume. Recruiters will use LinkedIn to share job postings or articles about companies to try to grab the attention of other business professionals. "LinkedIn Groups is a great venue for entering into a professional dialog with people in similar industries and provides a place to share content with like-minded individuals."(WordStream). Two very familiar social medias that are used for marketing are Facebook and Twitter. These two sites are very highly used by all businesses large and small for marketing purposes. Companies can have their own social media profiles or they can just put ads on these popular sites. Either way, by doing this companies are putting their brand out there for people to see. "Social media marketing takes advantage of social networking to help a company increase brand eposure a broaden customer reach."(Rouse,2016).

Majority of social media sites are free to use and it's free to create an account. There is no fee or any sort of payment that is needed for you to use them as much as you want. According to Investopedia, "If you're not paying for the product, the product is you."(McFarlane). The whole concept behind social media is to make money off of its users. Every day hundreds of thousands of users are on social media sites, so why wouldn't businesses take advantage of that kind of market place. All social media sites have advertisements somewhere visible to the user. "The most common way for websites to generate revenue is to allow companies to advertise on the site."(Campbell,2010). Some users may not like advertisements, but others may love them. Ads can catch your eye and show you products or services tha you didn't even know existed. Ads can also be a quick and easy way to jump from your favorite social media site to an online shopping site to buy something you needed. Another way social media companies get money is through Venture capitalists. "Most (if not all) social networks start with funding from venture capitalists."(Campbell,2010). This usually will come at the start of a social media company. Venture capitalists would invest in the social media start up if they think they can make profit. There is another way some social media sites make money and that is by offering upgrade options. I am referring to, "LinkedIn, for example, has a premium package for job seekers. All of your networking options are free with LinkedIn, but if you want special privileges you have to sign up for one of their premium options."(Campbell,2010). These are a few ways social media companies make money and they are doing very well at it.

There are a few very well-known social medias out there. I bet most people these days can guess which the top ones are. There is Facebook, Twitter, Instagram, Snapchat and LinkedIn. All of which, I am currently a user of. The incredible thing is how often social media users actually access their social media accounts. "In terms of active daily use Facebook is also in the lead. 76% of users log in daily, while 51% do for Instagram (owned by Facebook). Twitter manages just 42% of user's login in daily, only just over half the Facebook figure."(Chaffey,2017). Facebook has topped almost all of the charts when it comes to being the top social media company. "According to statistics from the Nielson Group, Internet users within the United States spend more time on Facebook than any other website."(Rouse,2016). Facebook has flourished since it started off and continues to grow and evolve. There have been a few more recent social medias like Instagram, Twitter and Snapchat that have brought some competition to the field. There are so any users out there and Internet access is becoming more and more accessible all over the world. This is allowing social media companies to grow and create more business.

The thing about social media though is that you don't have to choose just one. A user can have an account with every social media out there. I bet if you walked into a room at a high school or college now, over three quarters of the people in it would say they have a social media account. This being the case it has endless possibilities for business to market. The best part is, "Most social media platforms offer incredibly granular targeting capabilities, allowing you to focus your budget on exactly the types of people that are most likely to be interested in your business."(WordStream). Social media marketing ties in directly with how social media companies make money. Social media is a growing business platform with endless and ever changing possibilities.