The biggest and most successful invention of technology has to be social media. In today’s world, everyone is familiar with social networking and might even be familiar with one to two common social media platforms. No matter what we do on the internet, we utilize a social media networking site or application. But have you ever considered how these Social Media Apps are making money? What are the benefits of these apps or social media in general? And which social media platforms are acing in the field with maximum user engagement? If yes, then this article will keep you all covered.
What Is Social Media?
It is essential to understand social media in order to comprehend social media apps and their workings. Social media refers to online networking platforms developed for multiple reasons or purposes. These platforms are created for people to make accounts, engage and build relations with like-minded people all over the world, share various kinds of pieces of knowledge, and acquire useful information.
Nowadays, social media is more than just building connections and increasing networking. It has also helped people establish well-built businesses, find career opportunities, create content, do digital marketing, to purchase or sell goods, products, and services.
What Are The Types Of Social Media?
Considering the unlimited purposes of social media platforms. Social media is an umbrella term that further divides into different categories, each serving its unique purposes. Below are just a few of the types of social media platforms that share information, images, videos, updates, news, etc.
- Traditional networking social media platforms.
- Social review social media platforms.
- Image and video sharing on social media platforms.
- Video hosting social media platforms.
- Social media platforms for community blogs.
- Discussion sites on social media.
- Social media platforms for sharing economy networks.
What Are The Benefits Of Social Media?
Having one of the biggest platforms in the technological world, social media, and networking resources have multiple benefits. A study conducted in the European Union also highlighted the benefits of social media, including sharing information, work-from-home opportunities, educational benefits, etc. In this section of the article, we will review some of these benefits.
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Educational Purposes
Social media is a great source of sharing and acquiring educational information. Rather than spending a large amount of money on textbooks and learning material, students, as well as teachers, are now utilizing social media platforms to have access to knowledge. These platforms are beneficial for enrolling in different online courses, downloading books, reading blogs or articles, and creating groups for online studies and discussion.
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Sharing Of Information And Knowledge
Social media is currently one of the largest platforms used for sharing different kinds of informational posts. For instance, users can easily upload content regarding different tech trends, political matters, economic updates, etc.
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Building Communities
Another benefit of social media platforms is that they are helpful and resourceful tools for building communities. With the help of social networking websites or applications, like-minded people worldwide can become a part of these communities for different causes, share their opinions, and build long-lasting relationships.
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A Great Source Of Employment
Social media has now evolved as a helpful source of employment. During Covid-19, people got more attracted to the power of networking sites and shifted their businesses to online platforms. This, in return, resulted in great success. People are now more interested in starting online businesses, opting for work-from-home opportunities, and finding jobs through these platforms.
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Promotes Noble Causes
Last but not least, social media platforms are also helping people in starting and running campaigns for various noble causes, from spreading awareness regarding sensitive topics and taboos to running successful donation drives. Social media is a great option for collecting charity and helping people in need.
A List Of Top Social Media Platforms
Here is a list of some of the top social media platforms that are being used worldwide by people and have amazing revenue generated.
- Facebook with 2.96 billion users.
- YouTube with 2.51 billion users.
- WhatsApp with 2 billion users.
- Instagram with 2 billion users.
- TikTok with 1.05 billion users.
- Telegram with 700 million users.
- Snapchat with 635 million users.
What Are Social Media Apps?
Social media platforms are available to access in two forms. Users can either utilize a social networking website or download Social Media Apps. Applications that are designed in this domain are downloaded on smartphones, tablets, iPads, and other electronic devices. These apps have features that promote smooth and functional working. Some of these features include multiple registration options, quick verification, visually appealing graphics, proper instructions in the form of tutorials or written information, data security, etc.
No matter what purpose a social media app is serving, there is no doubt that with time, people are getting attracted to app development and are moving forward to avail the Social Media app development services of digital companies to increase consumer engagement and sales generation.
How Do Social Media Apps Make Money?
A question that is frequently asked by people is how social media applications make money. Since most of these are free to download and use, then are the owners making any sort of profit? If yes, then how?
The first step is to select an effective monetization strategy. This step is one of the crucial and critical decisions that is taken in the pre-development stage of app development. The reason for deciding on a monetization strategy so soon is that it provides a framework for how you will develop the whole app. These models also assure an application’s return on investment (ROI) rate. In this section of the article, we will analyze the methods through which it is possible for Social Media Apps to make money.
1. Advertising and Affiliate Marketing
The first monetization strategy you can opt for in Social Media Apps is running advertisements in the application. If you have an account on a social media platform, seeing ads for different brands is common. This monetization strategy works with advertisement and promotion of other brands. Some options in this area are
- Cost-Per-Mile (CPM).
- Cost-Per-Click (CPC).
- Cost-Per-View (CPV).
- Cost-Per-Install (CPI).
2. In-app Purchases
In-app purchases are another monetization model which lets users buy or purchase different services and products in the social media application. The options that users get in this model are either consumable items like points or digital currencies used within the app or non-consumable items like new game levels or maps, etc.
3. Paid Subscriptions
Another beneficial monetization strategy is a paid subscription. This model works by providing a limited-time free trial to the user in which they can use and explore the application. After the trial period is ended, the users have to pay a fixed fee to create an account and have access to the app. There are two ways in which paid subscription is done, the first option is non-renewing subscriptions, and the second is automatically renewing subscriptions.
4. Freemium
The freemium monetization strategy works similarly to the paid subscription model. The only difference is that such Social Media Apps provide certain features and options of the application to the users that are free of cost. To get advanced options, users must pay an annual or monthly fee.
5. Sponsorship
Sponsorship works in a way that advertisements do. The only difference is that the logo of the sponsored company or brand will be placed somewhere in the application along with some of their information, deals, or offers.
6. Transaction Revenue
Transaction revenue or fees is a monetization strategy for applications where users transact money. For instance, applications like e-commerce marketplace, flight bookings, hotel bookings, meal ordering apps, etc.
7. Influencer Marketing
Another useful way through which Social Media Apps are known to make money is through influencer marketing. Social media influencers are people who have occupied a large chunk of these platforms with huge numbers of followers and admirers. As a social media app owner, you have to look out for influencers with the same target population as yours. This will lead to people listening to that particular influencer about your application and utilizing it.
8. Venture Capital And Crowdfunding
Venture Capital is a form of private investment where app developers look out for people who are wealthy enough to invest in their app idea. If a person or a party feels like your app idea is worth investing in, they contribute a share and sometimes their time and expertise in the entire Social Media app development services. The goal is that once the application starts generating a large amount of revenue, then the investors will get their money back with profit.
Crowdfunding is similar to venture capital as it lets app developers connect with people on platforms built for this purpose. They share their idea, developmental procedure, and updates to attract people and collect some funds.
9. User Data
Another useful method of making money from Social Media Apps is collecting and selling user data. This method is often found to be a controversial debate and a risky source of generating money. But it only works how the majority of people think it does. Social media applications do not sell identifiable user data like name, phone number, address, etc to other companies. What they do is keep a tap on the user behavior, pages they like, influencers they follow, and services they avail. This helps them to collect advertisers who can pay them to target a specific group.
Wrapping Up
There is no harm in accepting the fact that social media applications are being developed and launched in the market rapidly. These apps are popular and used by people all over the globe. In such times, it is important for app developers and businesses to connect with reliable and trustworthy companies like Celect Studios – an on-demand app development company, which is a perfect match for getting top-quality development services for your social media application.
