Here's How Social Media Gets Money From Users

How social media earns money (doc. Unsplash).

JAKARTA Social media companies such as Facebook, X, and TikTok can be used for free, but they always earn a large amount of income. This can happen because of their own users.

You may be wondering how social media will benefit greatly if most of its users don't pay anything. If you're curious, here are some things that encourage social media revenue, according to Makeuseof.

Advertising

The biggest entry of this platform comes from digital advertising. The more time you spend watching the feed, the more ads that are promoted or sponsorship uploads you see.

All of these advertisers certainly pay so they can get more audiences, betting on social media with millions of users. The number of advertisers on social media is huge, for example X and TikTok, of course not small.

User Data Sales

Apart from advertising, social media platforms also monetize user data through a data license. If you're worried, this social media doesn't sell your sensitive data. They only license data in the form of user behavior and interests.

Usually, companies that target this data are artificial intelligence (AI) companies such as OpenAI and Google. They buy this data in large quantities to train their AI models.

Premium Service

There is a direct way for social media to earn money from its users, namely by providing premium services. One platform that provides this subscription package is TikTok.

Usually, there is special access for paid users, for example such as removed ads, special badges on their profiles, or unlimited access for various interesting features.

Virtual Tips To Support Creators

Some social media provides purchases of coins to give gifts to creators when broadcasting live.

This prize is actually a tip for creators so they can receive money outside of ordinary video content.

Usually, social media companies will divide their commissions. For example, they will take 20 to 30 percent of the revenue in each transaction of their users.