Business Model of Big Social Networking Companies

>> December 19, 2015

All the big social networking companies are providing all services free to its users and you can think, it is doing social welfare activities. But it is your mistake. All big social networking companies are providing platform in a such a way that it can earn big profits in long run. I have my own profile in many social networking sites. From time to time, I learned these companies business model. If you are the student of business school, you should also learn these business models.

1. Business Model of Facebook

Facebook is the collection of profiles and pages of different websites. Every profile will increase its income source. Because it has made its business model in such a way. So, you have to understand it. Main business of Facebook is to sell its advertising space. Why will any advertiser buy facebook's advertising space. Because 1 out of 5 in the world population has facebook account. Every facebook user updates his or her picture or text message or video with other friends. It means whole facebook community generate big traffic. If there is the traffic anywhere, it is the chance of selling of any product. Facebook does not take any hosting  fees from any of its user. It is just 0.00001 of total earning which it earns from this business model. For example, you are finding your friend on facebook and you see ads rightside and above the profiles, you are searching. You will forget what you are searching. You will engage the ads. You may like ads. If you will like the ads. If Same advertiser's update speed is 100 times more than your friend's speed of update on facebook. It will sure, you will buy. It means, through this model, facebook helps advertiser to sell their products. Advertisers give big money to facebook. Same money facebook is using other new projects like Whatsapp

2. Business Model of Twitter 

Twitter's Business model is also getting earning through advertising. If you have twitter account and you are going to update it. It will ask to promote your profile.You will top of search if you will pay twitter through its ads program. In 2014, it has earned $ 1.4 billion through advertising. Except twitter shares the users' personal information to big companies for getting money.

3. Business Model of LinkedIn

You can see lots of professional profiles at LinkedIn. LinkedIn earns from advertising. LinkedIn has earned  $154.6 million by selling website's ads space. Except this, it has started skill learning business. When you will make your profile in LinkedIn, you will show your different advance skill. It is useful tool because LinkedIn profile is just like your professional bio-data. LinkedIn has bought Lynda.com in this April 2015, when you will click on any skill, it will go to Lynda.com website where you can learn any skill through video tutorials. For this, you have to buy a plan for watching Videos. You can buy basic plan by paying per month fees. This is big new source of LinkedIn. LinkedIn has also bought Slideshare website. So, all its business income is its own.


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