So how did this guy became a billionaire at the tender age of 23 by operating a FREE social media website?
Definitely not through his looks (oops, sorry not sorry).
Basically, most social media platforms are free for consumers. This benefit itself attract consumers by the horde to use the platform. On the other end, marketers are eyeing this population and pay whoever runs the platform to blast theirs ads to the consumers.
Consumers benefit from the free usage, marketers benefit as their ads are exposed to a larger targeted audience with a much lower cost as compared to traditional advertising. Sounds like a fairy tale where everyone lives together happily ever after?
As most consumers are not willing to pay for usage, the only way for social media companies to survive is through marketers paying them for advertisement space.
Many brands in hope of attaining the highest level of awareness pay these social media companies to spam their ads to consumers. Technically, social media companies only stand to gain from these deals. Firstly, they are paid for simply putting up Your ads. Secondly, they are able to test their consumer’s reaction through these ads for future strategy implementations.
However, ad spamming has its repercussions.
Short-term, ads start becoming insignificant to consumers and they simply brush through it. Marketers may be achieving a high level of reach, but not as much positive response or actions to their ads.
In the long run, consumers start forming associations of social media platforms with whatever ads they are spamming. Marketers promoting their brands on these website are often tied into these associations. Example, a social media platform spamming casino/gambling games. Consumer may associate it with promoting an unhealthy addiction, causing a decrease in the credibility and legitimacy of the social media platform. Companies marketing on the site are also deem as supportive of such negative behavior.
Therefore it is important for marketers to set a correct timing to display their advertisements to achieve maximum effectiveness and prevent their ads from being filtered out.