Understanding Business: How Social Media Sites make Money


Everyone has a social media account. As humans, we have moved on from staying in contact via letters and phones, instead, we share details of our intimate lives onto a social media wall that all of our close friends can look at and enjoy.

Since the introduction of social media in the early noughties, it has become a very prevalent part of all of our lives. It is hard to go anywhere and see somebody not indulging in their feeds or messages to friends and more and more people join the sites every year.

Something that you may have experienced when you join social media sites is that you don’t have to pay for any of your accounts. If you are someone who takes the time to question how social media works, you may be wondering how social media sites manage to survive when they have no income coming in? We wondered that too. Here is how social media sites make money.



One of the most obvious and well-known ways that social media sites are known to make money is through advertising. If you have a Facebook or Instagram account, then you have probably encountered plenty of annoying ads when you are trying to check up on your favorite influencer or close friend.

Though these ads may seem like an inconvenience, they are actually a very crucial part of maintaining the social media sites that you love to use. To keep these sites running, the sites need to employ a large team of people. These ads help to make sure that all of the crucial team members have the wage that they need in order to be able to fulfill their roles. But how do social media platforms make an income from the ads?


How ads work

Depending on the size of the social media platform, the platform usually will not have direct contact with the businesses that want to put ads on their site. Usually, they have a separate application process where the business will pay a set price and then input what kind of ads they want to be spread throughout the site. Usually, this will be a post that will pop up on select social media pages, based on the likes and activity of that social media account.


Big businesses

If you are a pretty big business and have plenty of cash to spend, then it is usually worthwhile getting into contact with the main body of whatever social media organization that you wish to advertise with. This is the best move as they will usually come to some agreement that means that you will be able to advertise throughout the site and not just to some select profile. Think of it as more of a collaboration than an advertisement, as the social media site will want to get all of your users to engage with them too.


Paid promotion

As well as being a great way for big brands to advertise themselves, most social media sites will allow their average user to promote their own posts. There has been an increase in people that want to make their social media presence something that can support them, which means that there are money-making opportunities for social media sites.

Depending on the settings of your account, popular sites such as Facebook and Instagram, give you the opportunity to promote your posts to a larger following. Promoting your posts may lead to more people following your social media account, which will make you more desirable to any potential businesses that you may want to work with in the future. Most social media sites allow you to do this for an extremely reasonable price, but for those that don’t, people tend to use sites like social rocket that promise to do the exact same thing for you.



Though it is not extremely common, some social media sites have various subscription services that you can sign up for. These subscription services usually increase the features that are available to you on your social media platform and gives you access to some of the private content of some of your favorite social media influencers.



As the times have moved on, fewer and fewer social media sites are using games within the site as a form of income. However, there are still some sites out there that make a substantial amount of money from games on their sites. A good example of this is Facebook, which has plenty of games that are available to play. Though these games are of course free to play, there are also aspects of the games which may persuade a player to spend some real-life money, such as in-game currency. This money can be used to help support the social media site financially.


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