“A STUDY ON MARKETING STRATEGIES TOWARDS SOCIAL

MEDIA MARKETING”

A PROJECT SUBMITTED TO
UNIVERSITY OF MUMBAI for partial completion of the degree of Bachelor of
Management Studies
Under the Faculty of Commerce
BY:
YASH SUNIL KARANDE

UNDER THE GUIDANCE OF:

DR. (Ms) URMILA SHETVE

K.G. JOSHI COLLEGE OF ARTS & N.G. BEDEKAR COLLEGE OF COMMERCE

(AUTONOMOUS), THANE
MARCH 2023

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 CERTIFICATE

K.G. JOSHI COLLEGE OF ARTS & N.G. BEDEKAR COLLEGE OF COMMERCE

(AUTONOMOUS), THANE

This is to certify that MR. YASH SUNIL KARANDE has worked and duly
completed his Project Work for the degree of Bachelor of Management Studied under
the Faculty of Commerce and his project is entitled, “A STUDY ON MARKETING
STRATEGIES TOWARDS SOCIAL MEDIA MARKETING” under my supervision.

I further certify that the entire project work has been done by learner under my
guidance and that no part of it has been submitted previously for any Degree or
Diploma of any University.

It is his own work and facts reported by his findings and investigations.

____________________
Name and Signature of
Guiding Teacher

Date of Submission:
_________________

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 DECLARATION BY LEARNER

I the undersigned MR. YASH SUNIL KARANDE here by, declare that the work
embodied in this project work titled “A STUDY ON MARKETING STRATEGIES
TOWARDS SOCIAL MEDIA MARKETING”, forms my own contribution to the
research work carried out under the guidance of DR. (Ms) URMILA SHETVE is a
result of my own research work and has not been previously submitted to any other
University.
Wherever reference has been made to the previous works of others, it has been
clearly indicated as such and included in the bibliography.
I, here by further declare that all information of this document has been obtained
and presented in accordance with the ethical conduct.

___________________________
Name and Signature of the learner

Certified by:
_____________________________
Name and Signature of the Guiding Teacher

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 ACKNOWLEDGEMENT
(Model Structure of the acknowledgement)

To list who all have helped me is difficult because they are so numerous and the
depth is enormous.

I would like to acknowledge the following as being idealistic channels and fresh
dimensions in the completion of this project.

I take this opportunity to thank the University Of Mumbai for giving me chance to
do this project.

I would like to thank my Principal DR. (Mrs) SUCHITRA A. NAIK for providing the
necessary facilities required for completion of this project.

I take this opportunity to thank our Coordinator Mr. NITIN PAGI , for her
moral support and guidance.

I would also like to express my sincere gratitude towards my project guide

Dr. (Mrs) UMILA SHETVE whose guidance and care made the project successful.

I would like to thank my College Library, for having provided various

reference books and magazines related to my project.

Lastly, I would like to thank each and every person who directly or indirectly
helped me in the completion of the project especially my Parents and Peers who
supported me throughout my project.

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 SUMMARY

The aim of this project is to introduce the reader to the topic of “ A STUDY ON
MARKETING STRATEGIES TOWARDS SOCIAL MEDIA MARKETING”. The
study is focused on how do social media sites raise money, the different types of
funding methods. It is also focused on the various ways by which they earn money.

Under this project I have covered about the rise and importance of social media.
The positive and negative impact of social media on business and economy.

Under this project I have covered the different methods of funding that the social
media sites do the raise capital and the different ways by which they earn money.

For the case study, I have analysed 6 social media sites in detail. They are
Facebook, Snapchat, Twitter, Instagram and Indian companies like Hike Messanger
and Sharechat.

For each of the above companies I have listed out the various funding rounds that
took place to generate money and start and the different ways they earn money. I
have also mentioned the history of the company, how it started, when it all began,
its acquisitions.

I have also provided with the company balance sheets that shows us their
financial position, their income statement which shows us their gross and net
profit, and the cash flow statement that shows the expenses and revenue of the
company for that last 4 years.

There was a survey that was conducted and from that it was known that existence
of social media is a boon to the people, almost everyone uses it. It was also
concluded that most of the people do not know how do social media sites earn
money and raise capital.

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 INDEX
SR NO PARTICULARS PAGE NO
1 INTRODUCTION 7
1.1 WHAT IS SOCIAL 7
MEDIA ?
1.2 RISE OF SOCIAL 9
MEDIA
1.3 SOCIAL MEDIA 12
CURRENTLY
1.4 FACEBOOK 14
1.5 INSTAGRAM 17
1.6 TWITTER 21
1.7 YOUTUBE 22
1.8 SNAPCHAT 25
2 RESEARCH 28
METHODOLOGY
2.1 OBJECTIVES 28
2.2 SAMPLE SIZE 28
2.3 DATA COLLECTION 29
2.3.1 PRIMARY DATA 29
2.3.2 SECONDRY DATA 29
2.4 SCOPE OF THE STUDY 30
2.5 LIMITATION 30
3 LITERATURE REVIEW 31
4 CASE STUDY 39
4.1 FACEBOOK 39
4.2 INSTAGRAM 47
4.3 SNAPCHAT 53
4.4 TWITTER 57
4.5 SHARECHAT 62
4.6 HIKE MESSANGER 66
5 DATA AANALYSIS, 68
INTERPRETATION &
PRESENTATION
5.1 PRIMARY DATA 68
5.2 SECONDRY DATA 80
6 CONCLUSION 102
7 SUGGESTION 105
8 BIBLOGRAPHY 107
9 ANNEXURE 108

1. INTRODUCTION

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 1.1 WHAT IS SOCIAL MEDIA
Social media are interactive computer-mediated technologies that facilitate the
creation or sharing of information, ideas, career interests and other forms of
expression via virtual communities and networks.
Social media may have roots in the 1840s introduction of the telegraph, which
connected the United States. The PLATO system launched in 1960, which was
developed at the University of Illinois and subsequently commercially marketed
by Control Data Corporation, offered early forms of social media features with
1973- era innovations such as Notes, PLATO's message-forum application;
TERM-talk, its instant-messaging feature; Talkomatic, perhaps the first online chat
room; News Report, a crowd-sourced online newspaper and blog; and Access
Lists, enabling the owner of a note file or other application to limit access to a
certain set of users, for example, only friends, classmates, or co-workers.
A precursor of the electronic bulletin board system (BBS), known as Community
Memory, had already appeared by 1973. True electronic bulletin board systems
arrived with the Computer Bulletin Board System in Chicago, which first came
online on February 16, 1978. Before long, most major cities had more than one
BBS running on TRS-80, Apple II, Atari, IBM PC, Commodore 64, Sinclair, and
similar personal computers. The IBM PC was introduced in 1981, and subsequent
models of both Mac computers and PCs were used throughout the 1980s. Multiple
modems, followed by specialized telecommunication hardware, allowed many
users to be online simultaneously. CompuServe, Prodigy and AOL were three of
the largest BBS companies and were the first to migrate to the Internet in the
1990s. Message forums (a specific structure of social media) arose with the BBS
phenomenon throughout the 1980s and early 1990s. When the Internet proliferated
with the World Wide Web (WWW) in the mid-1990s, message forums migrated
online, becoming Internet forums, primarily due to cheaper per-person access as
well as the ability to handle far more people simultaneously than telco modem
banks.

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The following list of the leading social networks shows the number of
active users:

SR NO NETWORK NUMBER OF COUNTRY OF

NAME USERS (IN ORIGIN
MILLIONS)
1 Facebook 2,958 United States
2 Youtube 2,514 United States
3 Whatsapp 2000 United States
4 Facebook 931 United States
Messenger
5 WeChat 1,309 China
6 Instagram 2000 United States

7 QQ 574 China
8 QZone 572 China
9 TikTok 1,051 China
10 Sina Weibo 584 China
11 Twitter 556 United States
12 Reddit 330 United States
13 Baidu Tieba 320 China
14 LinkedIn 900 United States
15 Snapchat 635 United States
16 Pinterest 445 United States
17 Viber 260 Israel
18 Discord 140 United States
19 Telegram 700 United Arab
Emirates

Geo Cities was one of the Internet's earliest social networking websites,
appearing in November 1994, followed by Classmates in December 1995 and Six
Degrees in May 1997. According to CBS news, Six Degrees is "widely
considered to be the very first social networking site", as it included "profiles,
friends lists and school affiliations" that could be used by registered users. Open
Diary was launched in October 1998; LiveJournal in April 1999; Ryze in October
2001; Friendster in March 2003; the corporate and job-oriented site LinkedIn in
May 2003; hi5 in June 2003; MySpace in August 2003; Orkut in January 2004;
Facebook in February 2004; Yahoo! 360° in March 2005; Bebo in July 2005; the
text-based service Twitter, in which posts, called "tweets", were limited to 140
characters, in July 2006; Tumblr in February 2007; and Google+ in July 2011.

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Six Degrees, launched in 1997, is often regarded as the first social media site.
Facebook, the largest social media platform in the world, has 2.4 billion users.
Other social media platforms including Youtube and Whatsapp also have more
than one billion users each.
These numbers are huge – there are 7.7 billion people in the world, with at least
3.5 billion of us online. This means social media platforms are used by one-inthree
people in the world, and more than two-thirds of all internet users.
Social media has changed the world. The rapid and vast adoption of these
technologies is changing how we find partners, how we access information from
the news, and how we organize to demand political change.
Who uses social media? When did the rise of social media start and what are the
largest sites today? Here we answer these and other key questions to understand
social media use around the world.
We begin with an outline of key trends and conclude with a perspective on the
rate of adoption of social media relative to other modern communication
technologies.

1.2 RISE OF SOCIAL MEDIA

The first social media site to reach a million monthly active users was My Space –
it achieved this milestone around 2004. This is arguably the beginning of social
media as we know it.
In the interactive chart below we plot monthly active users, by platform, since
2004.
This chart shows that there are some large social media sites that have been
around for ten or more years, such as Facebook, YouTube and Reddit; but other
large sites are much newer.
Tik Tok, for example, launched in September 2016 and by mid-2018 it had already
reached half a billion users. To put this in perspective: Tik Tok gained on average
about 20 million new users per month over this period.
The data also shows rapid changes in the opposite direction. Once-dominant
platforms have disappeared. In 2008, Hi5, MySpace and Friendster were close
competitors to Facebook, yet by 2012 they had virtually no share of the market

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Facebook has dominated the social media market for a decade, but five other
platforms also have more than half a billion users each
With 2.3 billion users, Facebook is the most popular social media platform today.
YouTube, Instagram and WeChat follow, with more than a billion users. Tumblr
and Tik Tok come next, with over half a billion users.
The bar chart below shows a ranking of the top social media platforms, year by
year. You can drag the slider in this chart to see the ranking for other years.
In general, young people are more likely to use social media than older people.
But some platforms are much more popular among younger people. This is shown
in the chart where we plot the breakdown of social media use by age groups in the
US.
For Snap chat and Instagram, the ‘age gradient’ is extremely steep – the
popularity of these platforms drops much faster with age. The majority of people
under 25 use Snap chat (73%), while only 3% of people over 65 use it.

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Since these platforms are relatively new, it’s hard to know how much of this age
gradient is the result of a “cohort effect”.

Let’s now look at gender differences.

In this other chart we show the percentage of men and women who use
different platforms in the US. The diagonal line marks parity; so, sites above the
diagonal line are those more popular among men and sites below are those
more popular among women. (Bubble sizes are proportional to the total number
of users of each platform).

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1.3 SOCIAL MEDIA CURRENTLY

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13
 1.4 FACEBOOK

Facebook is an American online social media and social networking service based
in Menlo Park, California and a flagship service of the namesake company
Facebook, Inc. It was founded by Mark Zuckerberg, along with fellow Harvard
College students and roommates Eduardo Saverin, Andrew McCollum, Dustin
Moskovitz and Chris Hughes.
The founders initially limited Facebook membership to Harvard students.
Membership was expanded to Ivy League schools, MIT, and higher education
institutions in the Boston area, then various other universities, and lastly high
school students.
Since 2006, anyone who claims to be at least 13 years old has been allowed to
become a registered user of Facebook, though this may vary depending on local
laws. The name comes from the face book directories often given to American
university students. The Facebook service can be accessed from devices with
Internet connectivity, such as personal computers, tablets and smartphones. After
registering, users can create a profile revealing information about themselves.
They can post text, photos and multimedia which is shared with any other users
that have agreed to be their "friend", or, with a different privacy setting, with any
reader. Users can also use various

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embedded apps, join common-interest groups, buy and sell items or services on
Marketplace, and receive notifications of their Facebook friends' activities and
activities of Facebook pages they follow. Facebook claimed that it had more than
2.3 billion monthly active users as of December 2018.
Facebook has been subject to extensive media coverage and many controversies.
These often involve user privacy (as with the Cambridge Analytica data scandal),
political manipulation (as with the 2016 U.S. elections), psychological effects such
as addiction and low self-esteem, and content that some users find objectionable,
including fake news, conspiracy theories, and copyright infringement.
Commentators have accused Facebook of helping to spread false information and
fake news. In 2017, Facebook partnered with fact checkers from the Poynter
Institute's International FactChecking Network to identify and mark false content,
though most ads from political candidates are exempt from this program. Critics of
the program accuse Facebook of not doing enough to remove false information
from its website. Facebook was the most downloaded mobile app of the 2010s
globally.

Facebook statistics
When it comes to social media platforms, Facebook continues to dominate. It
remains the most used platform among both marketers and consumers, according
to the Sprout Social 2019 Index. Here are some noteworthy social media statistics
related to Facebook:
1. 89% of marketers use Facebook in their brand marketing efforts.
2. 83% of surveyed consumers use the platform.
3. 66% say they Like or Follow a brand on the platform.
4. By the third quarter of 2019, the platform had attracted 2.5 million monthly
active users.
5. By the third quarter of 2019, the platform had attracted 2.5 million monthly
active users.
6. Live video is becoming a vital tool for social marketers, and 42% of them have
already developed a strategy for Facebook Live.
7. From posting a median of 0.97 posts per day, brands are seeing a median
engagement rate of 0.09% on the platform across all industries.

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8. Along with its growing user base, the platform also sees an increase in revenue.
It generated $17.65 billion in total revenue in the third quarter of 2019.
9. Out of this, a majority came from advertising. This isn’t too surprising
considering how Facebook had over 7 million advertisers during Q3 of 2019.
10. Facebook use among U.S. marketers is on a slight increase from 86.3% in
2018 to 86.8% in 2019. This number will likely reach 87.1% in 2020.
11. Live video is becoming a vital tool for social marketers, and 42% of them
have already developed a strategy for Facebook Live.
12. From posting a median of 0.97 posts per day, brands are seeing a median
engagement rate of 0.09% on the platform across all industries.
13. Along with its growing user base, the platform also sees an increase in
revenue. It generated $17.65 billion in total revenue in the third quarter of 2019.
14. Out of this, a majority came from advertising. This isn’t too surprising
considering how Facebook had over 7 million advertisers during Q3 of 2019.
15. Facebook use among U.S. marketers is on a slight increase from 86.3% in
2018 to 86.8% in 2019. This number will likely reach 87.1% in 2020.

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User growth

Facebook's rapid growth began as soon as it became available and has continued
through 2018.
Facebook passed 100 million registered users in 2008, and 500 million in July
2010. According to the company's data at the July 2010 announcement, half of the
site's membership used Facebook daily, for an average of 34 minutes, while 150
million users accessed the site by mobile.
In October 2012 Facebook's monthly active users passed one billion, with 600
million mobile users, 219 billion photo uploads, and 140 billion friend
connections. The 2 billion user mark was crossed in June 2017.
In November 2015, after skepticism about the accuracy of its "monthly active
users" measurement, Facebook changed its definition to a logged-in member who
visits the Facebook site through the web browser or mobile app, or uses the
Facebook Messenger app, in the 30 day period prior to the measurement. This
excluded the use of third-party services with Facebook integration, which was
previously counted.
Active users of Facebook increased from just a million in 2004 to over 2.3 billion
in 2018.

1.5 INSTAGRAM

Instagram is an American photo and video-sharing social networking service

owned by Facebook, Inc. It was created by Kevin Systrom and Mike Krieger, and
launched in October 2010 exclusively on iOS. A version for Android devices was
released a year and half later in April 2012, followed by a feature-limited website
interface in November 2012, a Fire OS app on June 15, 2014 and an app for
Windows 10 tablets and computers in October 2016. The app allows users to
upload photos and videos to the service, which can be edited with various filters,
and organized with tags and location information. An account's posts can be shared
publicly or with pre-approved followers. Users can browse other users' content by
tags and locations, and view trending content. Users can like photos and follow
other users to add their content to a feed.

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The service was originally distinguished by only allowing content to be framed in
a square (1:1) aspect ratio with 640 pixels to match the display width of the iPhone
at the time. These restrictions were later eased in 2015, with an increase to 1080
pixels. The service also added messaging features, the ability to include multiple
images or videos in a single post, as well as "Stories"—similar to its main
competitor Snap chat—which allows users to post photos and videos to a
sequential feed, with each post accessible by others for 24 hours each. As of
January 2019, the Stories feature is being used by 500 million users daily.
After its launch in 2010, Instagram rapidly gained popularity, with one million
registered users in two months, 10 million in a year, and 1 billion as of May 2019.
In April 2012, Facebook acquired the service for approximately US$1 billion in
cash and stock. As of October 2015, over 40 billion photos had been uploaded to
the service. Although praised for its influence, Instagram has been the subject of
criticism, most notably for policy and interface changes, allegations of censorship,
and illegal or improper content uploaded by users.

Users

Following the release in October, Instagram had one million registered users in
December 2010. In June 2011, it announced that it had 5 million users, which
increased to 10 million in September. This growth continued to 30 million users in
April 2012, 80 million in July 2012, 100 million in February 2013, 130 million in
June 2013, 150 million in September 2013, 300 million in December 2014, 400
million in September 2015, 500 million in June 2016, 600 million in December
2016, 700 million in April 2017, and 800 million in September 2017.
In October 2016, Instagram Stories reached 100 million active users, two months
after launch. This increased to 150 million in January 2017, 200 million in April,
surpassing Snap chat's user growth, and 250 million active users in June 2017.
In April 2017, Instagram Direct had 375 million monthly users.
In June 2011, Instagram passed 100 million photos uploaded to the service. This
grew to 150 million in August 2011, and by June 2013, there were over 16 billion
photos on the service. In October 2015, there existed over 40 billion photos.

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Demographics
Instagram's users are divided equally with 50% iPhone owners and 50% Android
owners. While Instagram has a neutral gender-bias format, 68% of Instagram users
are female while 32% are male. Instagram's geographical use is shown to favor
urban areas as 17% of US adults who live in urban areas use Instagram while only
11% of adults in suburban and rural areas do so. While Instagram may appear to
be one of the most widely used sites for photo sharing, only 7% of daily photo
uploads, among the top four photo-sharing platforms, come from Instagram.
Instagram has been proven to attract the younger generation with 90% of the 150
million users under the age of 35. From June 2012 to June 2013, Instagram
approximately doubled their number of users. With regards to income, 15% of US
Internet users who make less than $30,000 per year use Instagram, while 14% of
those making $30,000 to $50,000, and 12% of users who make more than $50,000
per year do so. With respect to the education demographic, respondents with some
college education proved to be the most active on Instagram with 23%. Following
behind, college graduates consist of 18% and users with a high school diploma or
less make up 15%. Among these Instagram users, 24% say they use the app
several times a day.

Instagram statistics
Among all social media platforms, Instagram likely sees the most evolution with
new features every few months. In 2019 alone, the platform was testing a new
display layout for IGTV, hiding likes in the U.S and introducing “Reels” mode
akin to Tik Tok. And in late 2019, Instagram introduced a layout feature for
Instagram Stories, allowing users to post multiple pictures on one screen. This
goes to show how Instagram constantly strives to stay relevant and update its
features with the changing times. So, it’s only natural that the platform will
continue to see an increase in user count and engagement. These Instagramspecific
social media statistics paint a clearer picture:
1. Instagram now has over 1 billion monthly active users–a 42.86% increase from
2017 when it had 700 million. That’s a lot of growth in just two years’ time.

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2. Among these users, 90% follow a business on the platform, suggesting that
Instagram users are keen on hearing from and about brands.
3. The platform also takes the cake when it comes to engagement. Brands are
driving a median engagement of 1.60% across all industries on Instagram.
4. Instagram continues to be the most popular influencer marketing 89% of
marketers in a Mediakix survey say that it’s the most important social media
platform for influencer marketing.
5. 78% say that Instagram posts are the most effective content format for
influencer marketing, while 73% say the same about Instagram Stories.
6. Considering these factors, it’s not too much of a surprise that the platform is
seeing an upward trend in ad revenue–jumping from $23.66 billion in 2018 to
$28.52 billion in 2019. According to projections, Instagram will likely net $33.71
billion in ad revenue during 2020.
7. Instagram is also the only platform where there’s a significant increase in usage
by U.S marketers. The number jumped from 69.2% in 2018 to 73.2% in 2019,
with a possibility of reaching 75.3% in 2020.

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 1.6 TWITTER

Twitter is an American micro blogging and social networking service on which

users post and interact with messages known as "tweets". Registered users can
post, like, and retweet tweets, but unregistered users can only read them. Users
access Twitter through its website interface, through Short Message Service (SMS)
or its mobiledevice application software ("app"). Twitter, Inc. is based in San
Francisco, California, and has more than 25 offices around the world. Tweets were
originally restricted to 140 characters, but was doubled to 280 for non-Asian
languages in November 2017. Twitter was created in March 2006 by Jack Dorsey,
Noah Glass, Biz Stone, and Evan Williams, launched in July of that year. The
service rapidly gained worldwide popularity. In 2012, more than 100 million users
posted 340 million tweets a day, and the service handled an average of 1.6 billion
search queries per day. In 2013, it was one of the ten most-visited websites and has
been described as "the SMS of the Internet". As of 2018, Twitter had more than
321 million monthly active users.

Twitter statistics

Twitter still stands strong as one of the top social media platforms in spite of a
slight drop in user count during the last two quarters of 2018. Marketers should
continue to keep an eye on the latest social media stats specific to the platform if
they want to include it in their marketing mix.
1. As of Q1 2019, Twitter has about 330 million active users worldwide.
2. 79% of Twitter users like to discover what’s new, making it the top platform for
discovery.
3. People are also 26% more likely to view ads on the platform than on any other
leading platform.
4. Twitter saw a 9% year-on-year increase in revenue for Q3 of 2019 with $824
million.
5. Brands send out a median of 0.86 tweets per day, for which they see a median
engagement of 0.048%.

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 1.7 YOUTUBE

Youtube is a global online video sharing and social media platform headquartered

in San Bruno, California. It was launched on February 14, 2005, by Steve Chen, Chad
Hurley, and Jawed Karim. It is owned by Google and is the second most
visited website, after Google Search. YouTube has more than 2.5 billion monthly
users, who collectively watch more than one billion hours of videos each day. As of
May 2019, videos were being uploaded at a rate of more than 500 hours of content per
minute.

In October 2006, YouTube was bought by Google for $1.65 billion. Google's

ownership of YouTube expanded the site's business model, expanding from
generating revenue from advertisements alone to offering paid content such as movies
and exclusive content produced by YouTube. It also offers YouTube Premium, a paid
subscription option for watching content without ads. YouTube also approved
creators to participate in Google's AdSense program, which seeks to generate more
revenue for both parties. YouTube reported revenue of $29.2 billion in 2022. In 2021,
YouTube's annual advertising revenue increased to $28.8 billion, an increase in
revenue of 9 billion from the previous year.

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Since its purchase by Google, YouTube has expanded beyond the core website
into mobile apps, network television, and the ability to link with other platforms.
Video categories on YouTube include music videos, video clips, news, short
films, feature films, songs,documentaries, movie trailers, teasers, live streams, vlogs,
and more. Most content is generated by individuals, including collaborations
between YouTubers and corporate sponsors. Established media corporations such
as Disney, Paramount, NBCUniversal, and Warner Bros. Discovery have also created
and expanded their corporate YouTube channels to advertise to a larger audience.

YouTube has had unprecedented social impact, influencing popular culture, internet

trends, and creating multimillionaire celebrities. Despite all its growth and success,
YouTube has been widely criticized. Criticism of YouTube includes the website being
used to facilitate the spread of misinformation, copyright issues, routine violations of
its users' privacy, enabling censorship, their guidelines and how they are
implemented, and endangering child safety and wellbeing.

Key Youtube Statistics:

 There are approximately 467 million active YouTube users in India, making in

the network’s largest audience by country.
 High-speed internet became widely available in India in 2016, and internet
usage has flourished there ever since. This speedy adoption has contributed to
the rise of Indian YouTube stars like T-Series, who is one of the most
subscribed YouTubers on the platform.
 More than half (66%) of the content from YouTube’s top 250 channels is
produced in English, followed by Spanish (15%) and Portuguese (7%
 About 77% of internet users between ages 15-35 are on YouTube, along with
73% of users aged 36-45, 70% of users aged 46-55 and 67% of users aged 56
 Roughly 53.9% of YouTube users are men and 46.1% are women. (There’s no
data on other genders available at this time.
 A Google-commissioned Nielsen study found that YouTube users are more
likely to be college educated compared to the general population.

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 YouTube ad campaigns pack a visual punch that generate responses from
consumers of all ages. If you’re wondering whether they’re worth the
investment, let’s dig into some YouTube ad stats.
 YouTube is a promising advertising platform for brands, generating over $7.9
billion in advertising revenue in the fourth quarter of 2022 alone.
 YouTube ad targeting capabilities create a highly tailored experience for the
end user. According to a 2022 study, 59% of respondents agree that YouTube
ads are more relevant than ads on linear TV or other streaming apps.

 Vertical video—meaning video filmed and viewed in portrait mode, rather

than landscape—has exploded in popularity on the platform since the launch
of YouTube Shorts. People have been watching YouTube on a variety of
screen sizes for quite some time. Now, marketers have the tools they need to
optimize for mobile viewing.

 YouTube has its own algorithm and search engine optimization rules to get

your content seen. Let’s get into a few stats related to YouTube search.

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 1.8 SNAP CHAT

Snapchat is a multimedia messaging app used globally, created by Evan Spiegel,

Bobby Murphy, and Reggie Brown, former students at Stanford University, and
developed by Snap Inc., originally Snap chat Inc.
One of the principal features of Snap chat is that pictures and messages are
usually only available for a short time before they become inaccessible to their
recipients. The app has evolved from originally focusing on person-to-person
photo sharing to presently featuring users' "Stories" of 24 hours of chronological
content, along with "Discover", letting brands show ad-supported short-form
content. It also allows users to keep photos in the "my eyes only" which lets them
keep their photos in a password protected space.
Snap chat has become known for representing a new, mobile- first direction for
social media, and places significant emphasis on users interacting with virtual
stickers and augmented reality objects.
As of October 2019, Snap chat has 210 million daily active users. Snap chat is
known to be popular among the younger generations, particularly those below the
age of 16, leading to many privacy concerns for parents.

Growth

As of May 2012, 25 Snap chat images were being sent per second and, as of
November 2012, users had shared over one billion photos on the Snap chat iOS
app, with 20 million photos being shared per day. That same month, Spiegel cited
problems with user base scalability as the reason why Snap chat was experiencing
some difficulties delivering its images, known as "snaps", in real time. Snap chat
was released as an Android app on October 29, 2012.

25
In June 2013, Snap chat version 5.0, dubbed "Banquo", was released for iOS. The
updated version introduced several speed and design enhancements, including
swipe navigation, double-tap to reply, an improved friend finder, and in-app
profiles. The name is a reference to the ghostly hero from Shakespeare's Macbeth,
a character in the play who is ultimately seen to be victorious over evil. Also, in
June 2013, Snap chat introduced Snap kidz for users under 13 years of age.
Snapkidz was part of the original Snap chat application and was activated when
the user provided a date of birth to verify his/her age. Snap kidz allowed children
to take snaps and draw on them, but they could not send snaps to other users and
could only save snaps locally on the device being used.
According to Snap chat's published statistics, as of May 2015, the app's users were
sending 2 billion videos per day, reaching 6 billion by November. By 2016, Snap
chat had hit 10 billion daily video views. In May 2016, Snap chat raised $1.81
billion in equity offering, suggesting strong investor interest in the company. By
May 31, 2016, the app had almost 10 million daily active users in the United
Kingdom. In February 2017, Snap chat had 160 million daily active users, growing
to 166 million in May.
In September 2016, Snap chat Inc. was renamed Snap Inc. to coincide with the
introduction of the company's first hardware product, Spectacles— smart glasses
with a built-in camera that can record 10 seconds of video at a time. On February
20, 2017, Spectacles became available for purchase online. Snap chat was
announced to be the 5th most downloaded mobile app of the decade, from 2011 to
2019.

Social media advertising statistics:

Although organic growth is what we all strive for, changes in social media
algorithms have made it much more challenging to achieve. Paid advertising has
become somewhat of a necessity, rather than an option, for businesses that want to
gain more visibility and strengthen the impact of their social marketing efforts.
Make the most of these social media advertising statistics to fuel your paid social
efforts for 2020:
1. Marketers are spending more on social media advertising; with social media ad
spend amounting to more than $89 billion in 2019.

26
2. According to projections, this ad spend will see an annual growth rate of 8.7%
and likely reach $102 billion by 2020.
3. Mobile users contribute to a majority of social advertising revenue. In fact, 94%
of the Facebook advertising revenue for Q3 of 2019 came from mobile.
4. The average ad spend per internet user also sees a gradual increase on mobile,
jumping from $13.49 in 2018 to $15.40 in 2019. In 2020, advertisers will likely
spend $16.85 per mobile internet user.
5. There’s a significant increase in adoption of new digital video ad formats like
shoppable ads and Stories ads. And marketers are increasing their digital video
budgets by 25% year-over-year.

27
 2. RESEARCH METHODOLOGY

2.1 OBJECTIVES:
• To study the growth of social media
• To take advantage of social media to earn income without investment
• To connect people across the globe instantly without any investment
• Ease of doing business
• To study change in business dynamics
• To study impact of social media on the economy
• To study financing options of social media
• To study the impact of social media in business

2.2 SAMPLE SIZE

The topic of my project is A Study On Marketing Strategis Towards Social Media
Marketing which includes financing and income of social media sites and apps.
For the primary data my sample size is 30 respondents.

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2.3 DATA COLLECTION

2.3.1 PRIMARY DATA

The primary data for the study are collected by using one elaborate questionnaire
for the respondents. The tools used in the exploration of the respondents towards
crypto currency questionnaires were finalized on the basis of the experiences of the
pilot study, 30 respondents of the selected sample were covered during the pilot
survey. In the light of the observations and experiences of the pilot survey, the
necessary changes were incorporated in the questionnaire. This phase of the
research process has helped a great deal in enhancing the contents of the schedules
in tune with objectives set out for the study.

2.3.2 SECONDARY DATA

The process of gathering reliable and meaningful information is the cardinal

aspect of the inquiry and forms a central link in the operational plan for the entire
research design. The secondary data are drawn from research reports, published
books, journals, bulletins, and the internet. The library of Mumbai University,
college library, online libraries and public libraries was helpful for the collection
of secondary data.

29
2.4 SCOPE OF THE STUDY

The main purpose of doing this project was to know how social media platform
generates money. This helps us to know the various methods of funding and
financing social media sites. We come to know how the top social networking sites
started. This also helps us to know how they earn money.
Social media also affects the economy and politics which gives us an impression
of how important and vast social media has come. The growth of social media is
unstoppable

2.5 LIMITATIONS

• Due to unavailability of primary data, this project is based on secondary data.

• Finding the information on the internet was difficult. Had to go through various
sites and read everything to get accurate information.

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 3. REVIEW OF LITERATURE
SOCIAL NETWORKS MARKETING AND BUSINESS TO
CONSUMER
Internet marketing is a branch of e-Commerce that deals with online advertisement
and marketing. E-Commerce covers all Internet business activities encompassing
Customer Relationship Management (CRM), e-tailing, search engine, portals, hubs,
and online auctions (Chippand Ismail,). The primary goal of
any e-Commerce site is for business transactions. At times, it may be difficult to
promote e-Commerce activities (products and brands) without involving social
activities. It is obvious that the marketing techniques for business networking exist
on the Internet, but most business owners do not understand how companies will
make use of marketing techniques to improve their businesses. Glen advises that
before a company opens an account and becomes active on the website, it is
important to consider what each site offers and how the company can benefit from
their resources. Further, companies need to take time to analyse what existing
social media strategy recommends, and how their companies can improve on
existing strategies, or introduce new marketing strategies. If a company exploits
the right business marketing strategy, then such company will be at the forefront.
But a company that does not understand the need for social networks marketing to
its business, may end up meandering through the site, without accomplishing its
purpose (Glen). Marketers today are making efforts in creating an initiative for
their customers in an attempt to distinguish their products and services from other
competitors. It is difficult to do so with the traditional media that tend to be oneway
communications from the seller to the buyer. As a result, marketers are
looking for ways to interact more with their customers as well as to get feedback
on their interaction. Some research had been carried out in pharmaceutical,
restaurant and construction companies on the use of social network marketing as a
way of integrating business to consumer (Kevin; Gupta and Udupa). 21 Globally,
pharmaceutical companies are now exploring the use of social networks marketing
for their product, which has really helped them to reduce money spent on
traditional marketing strategies. This opportunity has opened up ways for many
other pharmaceutical companies to promote their products and services, using
social

31
32
networks applications (Gupta and Udupa,). One of the first pharmaceutical
companies to adopt social networks marketing in the United States, in 2008, was
Merck. Merck set up a page on Facebook to promote its Gardasil vaccine followed
by GlaxoSmithKline, which also made use of video sharing site (YouTube) to
launch a promotional campaign for their products and services (Gupta and Udupa).
Kevin carried out a study on how SMEs can make use of social network sites, such
as Facebook to generate revenue. He carefully analysed how Facebook can be a
valuable marketing tool for generating business revenue and direct sales. Online
SNs also provide advertisers the opportunity to reach their target consumers.
Kevin cited examples of a small construction company, and a popular restaurant
called “Breakfast Club” both in Houston, Texas. The two SMEs advertised their
products online via social network sites. Both firms were able to secure clients at
minimal cost, improve their sales figures and maintain a good relationship with
their customers. Based on these benefits, Kevin concluded that social networks
marketing is profitable, viable, and should be an integral part of any business
marketing strategy.

INTERNET ADVERTISEMENT:
 The Internet advertisement is of two types, namely intrusive advertisement
andNon-intrusive advertisement (winner, 2009) Intrusive Advertisement: is a
kind of advertisement where consumers are being interrupted. Examples
includes: advertising through pop-up, banners, and spam mail or message.
 Pop-up is an online advertisement that appears on the screen without the
user’s permission or requesting for them. This method of advertising may be
regarded as irritating and are not always effective unless when a user has
personal interest in the company or in a particular product that is being
advertised (Chipp & Ismail).
 Banners: Banners are small box-like icon on the web pages that display
information or messages. If an Internet user click on the banner, then such user
will be directed to a website where more information will be displayed for the
user to view, and probably make a necessary purchase. Banner is one of the
best ways of online marketing because most of the messages displayed entice
a user to visit the website (Chipp & Ismail).

33
 Spam message is defined as an unsolicited message sent in form of email to
users of a website (Hutchison). In some cases, users get irritated by spam
messages and often ignore or delete such a message without even going
through it. Chipp and Ismail advised companies to always seek for consumers’
permission before sending email to them. A research conducted by Ducoffe
found that consumers perceived Internet advertising with scepticism. Many
consumers may find spam, banners and pop-ups irritating and could invoke
negative perceptions to online advertising. Due to negativity and problems
associated with spam, successful marketers in the United State have adopted a
code of conduct with the U.S. government, and several foreign countries have
passed legislation regulating, and banning the act of spamming (Hutchison).
Hutchison assumes that Internet marketing should not be a total substitute for
traditional promotion. These three intrusive Internet advertisements could
work together to achieve the purpose, and effectiveness of marketing. For
example, Spam and pop-up advertisement could be supported with offline
communication such as word of mouth.
 Non-Intrusive Advertisement Another Internet advertising in which a
consumer has to activate his/her account before participating in such a
communication. In nonintrusive advertisement, a consumer chooses to receive
the communications/information. Non-intrusive marketing can take many
forms, but this study will only discuss the most common ones, namely;
Internet presence sites, email, and social network applications.
 Internet presence sites: Most organizations or companies have a presence on
the Internet in other to provide information that will assist consumers to utilize
the products and services of the online provider. Most of the information has
to be available all the time in other to facilitate effective sales. In country, ,
where Internet access is limited, most companies still prefer to use offline
marketing communication methods to online social networks marketing.

34
  E-mail: companies use e-mail to send information to their customers most
especially when a product or services is newly introduced or a kind of special
offer is available on the website. Companies are advised to make sure that e-
mail is sent only when there is something new to offer customers, or there is
an update. Proper and accurate e-mail could be sent to entice the reader to
visit, and re-visit the website (Hutchison).
 Social network applications: Of all the new media, social network sites, such
as Facebook, Myspace, Second Life, and Youtube’s appear to be
widelyknown. In fact, the growth of these sites has led to the conception that
the world is now in the Web 2.0 era, where user-generated content and
discussions can create powerful communities that facilitate the interaction of
people with common interests. Many companies found this application useful
for connecting, communicating, and marketing (Enderset al.; Kevin, Gupta &
Udupa).

Social Media and Business

Smits and Mogos investigated the impact of social media on business

performance in Europe and pointed out that social media had gained popularity as
tools of business management in start-ups, small, medium-sized, and 65 large
organizations. The study revealed that social media applications enhanced the
business capabilities and business performance because of their inherent features
and operational qualities. The scholars suggested that various social media tools
should be combined into one effective social media ecosystem that enables
coordination between internal and external business processes.
Hutley studied the social networking sites as business tools in modern times and
opined that business organizations had considered social networking tools
frivolous and banned their use in the workplace. The study emphasized that by
embracing social networking tools and creating standards, policies, procedures,
and security measures. The scholar suggested that modern business houses should
boost productivity by sharing best practices and facilitating the transfer of advice and
information from colleagues rather than depending on social media.

35
Asur and Huberman analysed the role of social media and stated that social
media content could be used to predict real-world outcomes. The study revealed
that the social media were used to forecast box-office revenues for movies. The
scholars provided a simple model built from the rate at which tweets are created
about particular topics can outperform market-based predictors.
Broughton et al. assessed the implications of social media on employment
relations and found that social media and enabled modern organizations to
establish mutually beneficial relationship with the employees. The study revealed
that the designated employees post tweets about issues related to the organization.
The scholars noted that employees can glean a lot of important information from
the internet and so a blanket ban on internet use would be counterproductive.
Pernisco conducted an investigation on the impact of social media on society and
reported that social media like MySpace, Facebook and Twitter had become
prominent means of business communication. The study revealed that the social
networking sites had advertized the products and services and motivated the
customers to buy them. The scholar suggested that the gimmicks of social media
should be monitored in order to safeguard the interest of modern consumers.
Brown carried out a study on the role of social media in modern business world
and observed that social media were an integral part of the marketing plans of
business organizations. The study revealed that social media were accessible to the
customers and enabled them to undertake business transactions according to their
time and convenience. The study emphasized that modern business organizations
increasingly accessed social media sites numerous times a day, which provides
even more opportunities to connect with customers.
Fotis et al. examined the impact of social media in consumer behavior in Former
Soviet Union Republics and noted that social media were widely used in the
holiday travel planning process. The study revealed that social media had enabled
the people to share travel experiences and gained credibility since they were
more trustworthy than official tourism websites, travel agents and mass media
advertising.

36
Merrill et.al explored the role of social media in business management and
pointed out that social networking sites had encouraged businesses to change their
traditional marketing strategies and focus on interactive communication with the
customers and other stakeholders of business management. The study revealed that
social networking conversations created a level of immediacy and a kind of public
intimacy that is impossible with traditional marketing. The scholars emphasized
that social networking sites had given companies the opportunity to present a
human face in the form of a social media spokesperson which built trust in the
company’s authenticity as well as its professionalism.
Kirkpatrick evaluated the use of Facebook in the process of business
management and opined that Facebook had become a prominent website which
enabled about 350 million people across the globe to have business accounts. The
study revealed that social media like Friendster and MySpace remarkably
expanded the user base in the field of business. The study emphasized that the
Facebook had more or less subsided, and potential readers who obtained
practically several benefits related to business transactions.
Neti investigated the role of social media in the marketing communication
management and stated that modern marketers had utilized the social 67 media
opportunities and implemented new social initiatives at a higher rate than ever
before. The study revealed that global companies had recognized social media
marketing as a potential marketing platform and utilized them with innovations to
power their advertising campaign with social media marketing.
Awolusi studied the impact of social media on work place productivity in modern
organizations and found that social media had become effective tool of employee
relations and customer relations. The study revealed that social networking sites
had improved organizational productivity considerably. The scholar suggested that
social media should be systematically used for organizational functions, such as
training, recruiting, communication, and brand management.
Oracle Corporation analysed the role of social media in business management
and reported that social media had sparked a revolution in the customer experience
and

37
changed consumer behaviour around the globe. The study revealed that social
media played a vital role in the process of marketing management. The study
suggested that integration of social media into existing business processes would
provide reliable knowledge resources that ensure seamless, efficient cross-channel
delivery—rather than adding bolt-on, extraneous processes and workflows that
create inefficiencies and compound costs.
Stelzner assessed the use of social media by the marketers in the business field
and observed that marketers had used social media to promote their businesses all
over the world. The study revealed that social networking sites like Google+ and
photosharing sites like Pinterest were widely used as tools of marketing
communication. The scholar also examined social media outsourcing and how
marketers planned on using other forms of marketing. The scholar suggested that
business organizations should explore new avenues for business-to-consumer
companies-oriented business communication on the basis of active social media
application.
Koul conducted an investigation on the role of social media in business
management and noted that the rapid rise of social media in Asia had impacted the
business and society. The study revealed that the world’s internet-using population
had crossed a billion, with Asia accounting for 45% of it. The scholar 68
emphasized that social media had led major evolutionary trends both in society
and business. The scholar suggested that the values, culture, norms, and behavior
have made paradigm shifts which require careful consideration of factors that are
driving the digital revolution across the globe.
Rainie and Smith carried out a study on the relationship between social
networking sites and politics and pointed out that about 75% of users received
communication related to politics from social media. The study revealed that the
users were not particularly passionate about politics. The scholars found that a
portion of SNS users had assessed some relationships based on political material
that is posted on the sites. The scholars suggested that social media should be used
for active political mobilization and empowerment of the people in modern times.

38
Faulds examined the role of social media in the process of business management
and opined that social media were effective tools of customer relationship
management in modern times. The scholar noted that social media expanded
public participation, provided exposure to younger customers, ensured immediate
response, allowed open communication and facilitated participatory
communication. The scholar suggested that social media should be used for the
development of workforce and other stakeholders of business management.
Onete et. al explored the role of social media in the development of sustainable
business and stated that social media were used as effective instruments of
business communication. The study revealed that business organizations were able
to influence the internal and external environment with the help of social media.
The scholars suggested that the way management relates with its employees and
shareholders can be adjusted by using social media.
Kailer et al. evaluated the usage of social media in German B2Conline stores
from the years 2010 and 2011 and revealed that social media were used the most
in the modern online stores. The scholars noted that a majority of the features were
placed on product pages. The most common features were customer reviews and
ratings and the sharing and liking of product details.
Nalewajek and Mącik investigated the role of social media in building awareness
of responsible consumption and found that social media were used 69 actively for
the purpose of shaping responsible consumption in modern times. The study
revealed that social media also changed the attitudes and behaviors of modern
customers. The scholars suggested that scientific social media initiatives should be
developed for better marketing communication and brand management purposes
in the modern competitive business world.
Pew Research Center studied the role of social media platforms as sources of
news and reported that social media altered the news consumption patterns of
people remarkably. The study revealed that news played a varying role across the
social networking sites. The study emphasized the need for maintaining the
credibility of social media as prominent sources of news for various
communications media.

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 4.CASE STUDY

4.1 FACEBOOK

FUNDING Facebook was initially incorporated as a Florida LLC. For the first
few months after its launch in February 2004, the costs for the website operations
for thefacebook.com were paid for by Mark Zuckerberg and Eduardo Saverin, who
had taken equity stakes in the company. The website also ran a few advertisements
to meet its operating costs.
First angel investment
In the summer of 2004, venture capitalist Peter Thiel made a $500,000 angel
investment in the social network Facebook for 10.2% of the company and joined
Facebook's board. This was the first outside investment in Facebook.
In his book The Facebook Effect, David Kirkpatrick outlines the story of how
Thiel came to make his investment: former Napster and Plaxo employee Sean
Parker, who at the time had assumed the title of "President" of Facebook, was
seeking investors for Facebook. Parker approached Reid Hoffman, the CEO of
work-based social network LinkedIn. Hoffman liked Facebook but declined to be
the lead investor because of the potential for conflict of interest with his duties as
LinkedIn CEO. He redirected Parker to Peter Thiel, whom he knew from their
PayPal days (both Hoffman and Thiel are considered members of the PayPal
Mafia). Thiel met Parker and Mark Zuckerberg, the Harvard college student who
had founded Facebook and controlled it. Thiel and Zuckerberg got along well and
Thiel agreed to lead Facebook's seed round with $500,000 for 10.2% of the
company. Hoffman and Mark Pincus also participated in the round, along with
Maurice Werdegar who led the investment on behalf of Western Technology
Investment. The investment was originally in the form of a convertible note, to be
converted to equity if Facebook reached 1.5 million users by the end of 2004.
Although Facebook narrowly missed the target, Thiel allowed the loan to be
converted to equity anyway. Thiel said of his investment:

40
Accel investment (Series A):
In April 2005, Accel Partners agreed to make a $12.7 million venture capital
investment in a deal that valued Facebook at $98 million. Accel joined Facebook's
board, and the board was expanded to five seats, with Zuckerberg, Thiel, and
Breyer in three of the seats, and the other two seats currently being empty but with
Zuckerberg free to nominate anybody to those seats.
Greylock investment (Series B):
In April 2006, Facebook closed its Series B funding round. This included $27.5
million from a number of venture capitalists, including Greylock Partners and
Meritech Capital, plus additional investments from Peter Thiel and Accel Partners.
The valuation for this round was about $500 million. A leaked cash flow statement
showed that during the 2005 fiscal year, Facebook had a net gain of $5.66 million.
Sales negotiations:
With the sale of social networking website My Space to News Corp on July 19,
2005, rumours surfaced about the possible sale of Facebook to a larger media
company. Zuckerberg had already stated that he did not want to sell the company,
and denied rumours to the contrary. On March 28, 2006, BusinessWeek reported
that a potential acquisition of Facebook was under negotiation. Facebook
reportedly declined an offer of $750 million from an unknown bidder, and it was
rumoured the asking price rose as high as $2 billion.
In September 2006, serious talks between Facebook and Yahoo! took place
concerning acquisition of Facebook, with prices reaching as high as $1 billion.
Thiel, by then a board member of Facebook, indicated that Facebook's internal
valuation was around $8 billion based on their projected revenues of $1 billion by
2015, comparable to Viacom's MTV brand, a company with a shared target
demographic audience.
On July 17, 2007, Zuckerberg said that selling Facebook was unlikely because he
wanted to keep it independent, saying "We're not really looking to sell the
company ... We're not looking to IPO anytime soon. It's just not the core focus of
the company."
In September 2007, Microsoft approached Facebook, proposing an investment
in return for a 5% stake in the company, offering an estimated $300–500 million.
Thatmonth, other companies, including Google, expressed interest in buying a
portion of Facebook.
41
Microsoft investment (Series C):
On October 24, 2007, Microsoft announced that it had purchased a 1.6% share of
Facebook for $240 million, giving Facebook a total implied value of around $15
billion. However, Microsoft bought preferred stock that carried special rights, such
as "liquidation preferences" that meant Microsoft would get paid before common
stockholders if the company were sold. Microsoft's purchase also included the
right to place international ads on Facebook. In November 2007, Hong Kong
billionaire Li Ka-shing invested $60 million in Facebook.

FUNDING ROUNDS

DATE ROUND AMOUNT INVESTOR

May 10, 2011 Secondry Market All Blue Capita
May 4, 2011 Private equity General Atlantic
Jan 21, 2011 Private equity $1,500,000,000 Digital sky
Technologies
Goldman Sachs
Jan 28, 2010 Secondry Market $120,000,000 Elevation
Partners,
Technology
Crossover
Venture
May 26, 2009 Series D $200,000,000 Digital Sky
Techologies
May 01, 2008 Debt financing $100,000,000 Tripple Point
Capital
Mar 27, 2008 Series C $60,000,000 Horizon venture,
Li Ka-shing,
Frank Wilder
Jan 15, 2008 Series C $15,000,000 European
Founder Fund,
Staurt Peterson
Globlal Founder
Capital, Artis
Ventures (AV)
Nov 13, 2007 Series C $60,000,000 Horizons
Ventures, Li Ka-
shing
Oct 24, 2007 Series C $240,000,000 Microsoft
Apr 01, 2006 Series B $27,500,000 Grylock, Accel

42
 Partners,
Meritech Capital
Partners, SV
Angle
May 01, 2005 Series A $12,700,000 Accle Partners ,
Breyer Capital,
Cambrain
Ventures, Mark
Pincus, Reid
Hoffman
Sep 01, 2004 Angle $500,000 Peter Thiel, Reid
Hoffman, Mark
Pincus, Western
Technology
Investment

43
REVENUE

How Does Facebook Make Money?

Despite having over two billion users on its platform, Facebook doesn't actually
make any money on content or directly through its user base.
Instead, it makes billions via digital advertising, as Facebook has something that
companies really want - access to billions of people around the globe who might
buy their products or services. In fact, so many companies advertise on Facebook
that in 2017, Facebook earned $39.9 billion from advertising revenue. All in all,
the company earns about 85% of its money from advertising.

1. Self-Serve Advertising
This type of advertising is widely used on Facebook - self-serve advertising
enables anyone to create and put up an ad on Facebook. Self-serve advertisements
appear on the right side (or "sidebar") on Facebook pages, for individuals, groups,
user profiles, events, and third-party pages. Facebook's Ad Manager page helps
advertisers create their own ads, offering granular target tools to ensure the ad
reaches the intended audience.

2. Targeted Advertisements
Facebook holds a massive amount of personal data on its user base, including
gender, age, hobbies, career choices, political preferences, shopping preferences -
even their favorite baseball team. That allows Facebook to sell advertising space to
companies and organizations who want to hone in on a specific demographic, like
video game players or Range Rover owners. Or, more generically, advertisers can
target ads to larger groups of people based on political preferences, religion, or
even age. Advertisers can use specific tools like Facebook's Dynamic Ads to
market their entire inventory of products to users at different income levels, to up
their chances of making a sale. Targeted ads are a significant revenue generator for
Facebook, and it's all due to the data the company collects on its user base.

44
3. Facebook Messenger
Ads Facebook's ubiquitous Messenger tool, which enables Facebook users to
engage privately on a one-to-one basis, is increasingly being leveraged by
advertisers to get the word out on their products and services. The messenger
audience is huge, with two billion user engagements recorded in the fourth quarter of
2017.

4. Video Ads
Traditionally, Facebook Live has thrived as a digital tool that allows Facebook
users to connect via video, enabling grandparents to check in with their grandkids
thousands of miles away or old college friends to reconnect online to share stories
of their days back on campus. Increasingly, Facebook views video as an effective
means of connecting advertisers with Facebook users via Facebook Live.
Broadcasts via Facebook.

5. Facebook Mobile
In 2016, Facebook's core mobile app generated 83% of Facebook ad revenues,
making mobile its biggest money-making digital tool. As Facebook continues to
explore new advertising platforms, expect Facebook mobile to carry the revenue
burden for the company, as mobile advertising grows at a double-digit growth rate
on an annual basis.

6. Data Generation
Facebook is estimated to earn 85% of its total revenues from advertising, but ads
aren't the only source of income for the social media company.
While specific numbers are hard to come by, it's estimated that Facebook earns
$84 from each of its North American users, and $27 from each of its European
users. Of the U.S. and Canadian market, about $81 of that revenue comes from
advertising (up from 12% in 2012), leaving approximately 3% in revenue earned
from user-based data generation and direct business payments.

45
Facebook Revenue

Facebook Ad Statistics

Facebook is known for releasing quarterly earnings reports, which can be a

gold mine of value for marketers who rely on Facebook Ads. As Facebook
continues to make most of its revenue from advertising, the advertising
landscape will become more competitive. But this also means that Facebook
will likely keep and improving it’s advertising process to encourage continued
use.
Here are Facebook Ad statistics that will help you when creating new campaigns
this year.

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1. 94% of Facebook Ad revenue is from mobile
A mere 6% of Facebook’s advertising revenue comes from desktop-only users.
People continue to access Facebook primarily from mobile, which drives
advertisers to spend more money targeting mobile users. This information also
serves as a reminder of how important it is to optimize all of your social media
content to be as mobile friendly as possible.

2. The average price for Facebook Ads decreased 6% in 2019

This might come as a surprise considering how competitive Facebook Ads are
becoming. But, with a 37% increase in ad impressions, this is good news for
marketers who want to get the most out of their ad dollars in 2020. Facebook
attributes the decrease in ad prices to a mix of Stories and geographies ad
targeting, so this might signal even lower ad costs in the future.

3. The average cost per click for a Facebook Ad is $1.72

A study by Word stream calculated the average cost per click (CPC) for a
Facebook Ad across all industries and found $1.72 to be the benchmark number.
Knowing the cost per click can help you understand how much you might need to
spend on Facebook Ads to get a good ROI.

4. Overall Facebook Ad impressions increased 37% in 2019

Reach on Facebook is as high as ever. With impressions rising, and ad prices
dropping, it just reinforces that now is a great time to focus marketing energy on
the platform. According to Facebook CFO David Wehner, the spike in ad
impressions is a result of ads on Facebook Stories, Instagram Stories and
Facebook Newsfeed ads.

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4.2 INSTAGRAM
Revenue Breakdown

ADVERTISING
OTHER

How Instagram Makes Money

In April 2012, when Facebook acquired mobile photo-sharing app Instagram for
around $1 billion in cash and stock, many Wall Streeters were puzzled. After all, at
that time, Instagram was less than two years old and had no revenue to show for it.
But by December 2014, Citigroup analysts estimated that Instagram was worth
$35 billion, and just four years later, Bloomberg placed Instagram's value at nearly
$100 billion—10 times what Facebook originally paid for it.

Advertising on Instagram
In 2017, 98% of all Facebook revenue came from advertising. A hefty portion of
this income came directly from Instagram, which began collecting advertising
revenue in 2013. This is not surprising, given that research suggests advertising
growth on Instagram is actually exceeding that of its parent Facebook.
In fact, according to Merkle’s Digital Marketing Report, advertising spending on
Instagram grew 177% for the year ending in the second quarter of 2018, compared
to only 40% growth for Facebook, over that same time period. Furthermore,
impressions for Instagram in the same quarter grew by 209% year-over-year,
versus negative 17% growth for Facebook.
Advertising on Instagram is becoming increasingly sophisticated. One feature lets
advertisers show slideshows and link to sites outside Instagram. Furthermore, its
carousel ads facilitate multi-page print campaigns on mobile phones.

48
Acquisitions

In August 2009, Facebook acquired social media real-time news aggregator Friend
Feed, a start-up created by Gmail's first engineer Paul Buchheit.
In February 2010, Facebook acquired Malaysian contact-importing start-up
Octazen Solutions. On April 2, 2010, Facebook announced acquisition of a photo
sharing service called Divvyshot for an undisclosed amount. In June 2010, an
online marketplace for trading private Facebook stock reflected a valuation of
$11.5 billion.
On April 12, 2012, Facebook acquired photo sharing service Instagram for
approximately $1 billion in cash and stock.
On March 8, 2013, Facebook announced that they acquired the team from
Storylane, but not the product itself. On October 13, 2013, Facebook acquired
Onavo, an Israeli analytics company, for approximately $120 million.
On February 19, 2014, Facebook announced its acquisition of WhatsApp, a
smartphone instant messaging application for $19 billion in a mix of stock and
cash. The acquisition is the most ever paid for a venture-capital backed start-up.
47 On March 25, 2014, Facebook announced they had acquired virtual reality
start-up Oculus VR for $2 billion in cash and stock

49
Revenue of selected Social Media companies from 2014 to 2019 (in
Million US Dollars)

50
The Cambridge Analytica scandal
On the 17th March, 2018, a story broke. The New York Times and The Guardian
reported that data on tens of millions of Facebook users (up to 87m of them) had
been scraped through an app called “This Is Your Digital Life.”
People who used this app not only passed on their own personal information, but
that of their Facebook friends too. As more and more people used the app,
seemingly for a bit of fun, it soon collected a momentous amount of data. Aside
from this being pretty dodgy in itself, the data was then used for political purposes
to support various campaigns, including those of Donald Trump and Ted Cruz. It
was also used by the Vote Leave, a group that campaigned in support of Brexit.
Suddenly all eyes were on Facebook and Cambridge Analytica, and people were
not happy. There were calls for increased regulations around personal data, while
many investigated how to remove themselves from Facebook.
If that wasn’t bad enough, Facebook also lost $70bn off their share price thanks to
the scandal, while advertisers were getting cagey and worried.
Zuckerberg apologised for the issue and suspended Cambridge Analytica (the
company ceased operations itself on 1 May), and a slew of apps, from the platform
to address the problems people raised.
The scandal rumbled on, eventually leading to Zuckerberg testifying in front of
congress, and a $663,000 fine from the Information Commissioner’s Office in the
UK, while Facebook tried to reassure users and advertisers.
A lot of people were left with a bad taste in their mouth, while it added to many
people’s concerns around data. This still hangs over Facebook with the whole saga
seen as turning point around social media platforms and their access to our
information.

Testimony to Congress
During his testimony before Congress on April 10, 2018, Mark Zuckerberg said it
was his personal mistake that he did not do enough to prevent Facebook from
being used for harm. “That goes for fake news, foreign interference in elections
and hate speech.” During the testimony, Mark Zuckerberg publicly apologized for
the breach of private data: “It was my mistake, and I’m sorry. I started Facebook, I
run it, and I’m responsible for what happens here.” Zuckerberg said that in 2013

51
researcher Aleksandr Kogan from Cambridge University had created a personality
quiz app, which was installed by 300,000 people. The app was then able to retrieve
Facebook information, including that of the users' friends, and this was obtained
by Kogan. It was not until 2015 that Zuckerberg learned that these users'
information was shared by Kogan with Cambridge Analytica. Cambridge
Analytica was subsequently asked to remove all the data. It was later discovered
by The Guardian, The New York Times and Channel 4 that the data had in fact not
been deleted.

SR DATE INVESTOR FUNDING AMOUNT

NO TYPE
1 May 1, Decacorn Capital Seed
2011
2 May 1, Lightspeed venture Seed $485 k
2011 partners, Traveon
rogers
3 Feb 8, Lightspeed venture Series A $15 m
2013 partners,
SVAngel,Benchmark
4 Jun 22, Lightspeed vent Series B $80M
2013 ure partners, SV
Angel,Benchmark,
General Catalyst,
Tencent Holdings,
IVP (Institutional
Venture Partners)
5 Jun 23, Secondary $20M
2013 Market
6 Dec 11, Coatue Management Series C $50M
2013
7 Dec 31, Kleiner Perkins, Series D $485M
2014 GIC, HDS Capital,
yahoo
8 Mar 12, Alibaba, Kingdom Series E $200M
2015 Holding Company,
Access Technology
Ventures
9 Jun 13, Glad Brook Capital Series F
2015 Partners, Geodesic
Capital, Graphene
Ventures, Access
Technology Venture
10 Feb 11, All Blue Capital Secondary
2016 Market

52
11 May 25, Sequoia Capital, Series F $1.8B
2016 Meritech
Capital Partners,
T.Rowe Price,
Telstra Ventures,
Lone Pine Capital,
Coatue Management,
Fidelity Investments,
Dragoneer
Investment Group,
General Atlantic,
Glade Brook
Capital Partners,
York Capital
Management, GSV
Capital, Geodesic
Capital, IVP
(Institutional
Venture
Partners), Access
Technology
Ventures, G
12 Nov 9, Tencent Holdings Post-IPO $2B
2017 Equity
13 Aug 7, Alwaleed Bin Talal Post-IPO $250 M
2018 Equity

53
4.3 SNAPCHAT

REVENUE 1-
Snap Ads :
Snap Ads are the bread and butter of Snap chat advertising. They work by
showing 10-second, full-screen video ads that are always relevant to other snaps.
These ads are also interactive. When presented, users have the option to swipe up
to access more content – be it a longer video, blog post, or app install.
To improve conversions, the company launched Snap Chat Partners with firms
such as 4C, Social Code, Tube Mogul, and Adaptly. Data suggests that Snap Chat’s
ad revenue will hit nearly $1 billion next year.

2- Geo filters :
These are the words you’ll find in Snap chat’s description in the mobile app store.
It’s all about capturing the moment and sharing your experience with your
followers.
With GEO filters, users will no longer have to provide details manually. Whether
they’re in a mall, national event, or famous landmark, Snap chat offers exclusive
filters that will give context to any snap. They’ll no longer have to explain where
they are, what they’re doing, and why they’re there. Consequently, they are
encouraged to quickly produce user-generated content and share it to their social
circles

54
How does Snap chat profit from this feature? Keep in mind that the company is
not charging for the design on GEO filters. If you want to avail an on-demand Geo
filter, you’re going to have to create it yourself. However, Snap chat will charge
you for two things: the size of the area and the amount of time wherein the Geo
filter is available
. To start, Snap chat charges $5 for a coverage of 20,000 square feet, which is the
minimum area required for a Geo filter. This area is usually enough for a
medium sized office. On the other hand, the maximum purchasable area for a Geo
filter is 5 million square feet, which should be enough to cover a few city blocks
. GEO filters can stay live from anywhere from one hour to a total of 30 days.
Apart from big companies, individuals can also pay for temporary GEO filters on
events such as birthdays and weddings.
If you are not good in designing, you can always get someone else to do it.
Custom Filterz can be your solution. It offers a highly customized Geo filter for
users. Jason Slater, the co-Founder at Custom Filterz has a message to share,
For businesses who want a fully custom geo filter that people will share and fits
with their branding, Custom Filterz is the #1 rated geo filter design agency. We also
create GEO filters for birthday parties, weddings etc.”

3- Sponsored Lens Filters :

Realizing the appeal of lens filters toward Snap chat users, big companies went
ahead and launched their sponsored lens filters. These lens filters are similar to
GEO filters since they may also only appear in specific locations. However, lens
filters are more interactive and dynamic than stationary GEO filters. To increase
the user’s immersion, lens filters also play a sound clip when active.
For example, eating at KFC also enables the Colonel Sanders lens filter, which
turns users into the white-maned colonel himself. A special animation involving a
fried chicken leg also takes place – prompting the user to take a bite
. Take note that GEO filters and sponsored lens filters do more than just improve
the experience of customers.
Think about it – if you’re eating at Taco Bell and your head suddenly turns into a
giant taco shell, the first thing you’ll want to do is to share it with your friends. As a

55
result, brands who advertise on Snap chat gets to leverage user-generated content
(UGP) as well as the social media reach of their customers to gain exposure.
By the way, Taco Bell’s noble attempt at turning people’s heads into tacos did pay
off big.
A total of 224 million people interacted with the taco head Snap Chat filter. To be
fair, brands who wish to advertise using sponsored filters had to shell out as much
as $750,000. In comparison, the average cost of a 30-second ad on Super Bowl
costs a whopping $5 million. That’s without any guarantees that the audience is
even paying attention during the commercial.

4- Discover :
When using Snap chat, you may notice that swiping to the right two times opens
the Discover feed. Here, you can find curated snaps from publishers such as CNN,
Buzz Feed, People, and Cosmopolitan. There will also be a few advertisements
in between snaps, so it’s clear that Discover is being monetized
. Although no one knows how much Snap chat makes the Discover feature, they
should be making money hand over fist, given the fact that around 20 big name
publishers have partnered with the company. The feature also proliferated during
the time Snap Chat went through substantial revenue growth
. Most likely, both Snap chat and a publisher will be sharing ad revenue. It just
isn’t clear how much each party gets for every deal.

5- Sports Partnerships :
In recent years, Snap chat has partnered with sports organizations such as the
NHL, NFL, and the MLB. These organizations supposedly leverage Live Stories
during sporting events to reach more people in the social space
. Just like with Discover, it isn’t clear how much money Snap chat makes with
sports partnerships. But since the app offers a direct line to the young and
passionate audience, major leagues are investing in deals that put up weekly
Discover channels such as “MLB Wednesdays.”

56
ACQUISITIONS

Snap chat acquired:

1.Ad live on May 02, 2014 for $30 m
2.Vergence labs on December 17, 2014 for $15 m
3.Scan on December 17, 2014 for $50 m
4.Looksery on September 15, 2015 for $150 m
5.Bitstrips on May 24, 2016 for $64.20 m
6.Seene on June 03, 2016
7.Vurb on August 15, 2016 for $114.50 m
8.Flite on December 19, 2016
9.Cimagine media on December 25, 2016 for $30 m
10.Ctrl me robotics on May 26, 2017
11.Placed inc. on June 05, 2017 for $185.90 m
12.Zenly on June 22, 2017 for $213 m
13.Strong.codes on July 21, 2017
14.Metamarkets on November 03, 2017 for $100 m
15.Playcanvas on March 24, 2018
16.Teleport future technologies inc. on December 10, 2018
17.Aifactory on January 04, 2020 for $166 m

57
4.4 TWITTER

FUNDING
Twitter raised over US$57 million from venture capitalist growth funding,
although exact figures are not publicly disclosed. Twitter's first A round of funding
was for an undisclosed amount that is rumoured to have been between US$1
million and US$5 million. Its second B round of funding in 2008 was for US$22
million and its third C round of funding in 2009 was for US$35 million from
Institutional Venture Partners and Benchmark Capital along with an undisclosed
amount from other investors including Union Square Ventures, Spark Capital, and
Insight Venture Partners. Twitter is backed by Union Square Ventures, Digital
Garage, Spark Capital, and Bezos Expeditions.
In May 2008, The Industry Standard remarked that Twitter's long-term viability is
limited by a lack of revenue. Twitter board member Todd Chaffee forecast that the
company could profit from e-commerce, noting that users may want to buy items
directly from Twitter since it already provides product recommendations and
promotions.

By March 2009 communications consultant Bill Douglass predicted in an

interview that Twitter would be worth $1 billion within six months, which came to
pass when the company closed a financing round valuing it at $1 billion in
September of that year.

The company raised US$200 million in new venture capital in December 2010, at
a valuation of approximately US$3.7 billion. In March 2011, 35,000 Twitter shares
sold for US$34.50 each on Sharespost, an implied valuation of US$7.8 billion. In
August 2010 Twitter announced a "significant" investment led by Digital Sky
Technologies that, at US$800 million, was reported to be the largest venture round
in history.

In December 2011, the Saudi prince Alwaleed bin Talal invested US$300 million
in Twitter. The company was valued at US$8.4 billion at the time. In 2016, Twitter
was valued by Forbes at US$15.7 billion.

58
SR DATE INVESTOR FUNDING AMOUNT
NO TYPE
1 June 26,2007 Union Square $ 20 M
Ventures
2 July 29,2007 Union Square Series A $5M
Ventures, Ronald
Conway,Quixoti
c
Ventures,
Naval Ravikant,
MarcAndreessen,
Lowercase
Capital, Jason
Port, Greg
Yaitanes,
Dick Costolo,
CRV
3 June 24,2008 Spark Capital, Series B $15M
Bezos
Expeditions,
Union Square
Ventures and
Digital Garage
4 Feb 13, 2009 Union Square Series C $35M
Ventures,Spark
Capital, IVP
(Institutional
Venture
Partners), Digital
Garage, CRV,
Benchmark
5 Sep 25, 2009 T. Rowe Price, Series D $100M
Spark Capital,
Morgan
Stanley,Insight
Partners,IVP
(Institutional
Venture
Partners),
Benchmark
6 Jan 8, 2010 Kleiner Perkins Series E $5.2M
7 Dec 15, 2010 Union Square Series F $200M
Ventures,
T.Rowe Price,
Spark Capital,
Spark Capital,
Insight Partners,
IVP (Institutional
Venture

59
 Partners)
8 Aug 2, 2011 T. Rowe Price, Series G $400M
Lowercase
Capital,
Employee
Stock Option
Fund (ESO
Fund) , DST
Global, DFJ
Growth, Al
Waleed Bin Talal
9 Sep 1, 2011 All Blue Capital Secondary
Market
10 Sep 8, 2011 G Squared, Secondary $400M
Employee Stock Market
Option Fund
(ESO Fund)
11 Dec 20, 2011 Alwaleed Bin Venture Series $300M
Talal unknown
12 Oct 10, 2012 Slow Ventures Venture Series
unknown
13 Nov,2013 IPO $1.82B
14 Sept 11,2014 IPO $1.5B
15 Feb 17, 2015 Slow Ventures Venture Series
unknown

60
1.Native marketing :
Almost all of Twitter's revenue - about 85% of it - comes from advertising on its
site.

There are three main ways for a company or an individual to advertise on Twitter:
by promoting a tweet that will appear in people's timelines, promoting a whole
account, or promoting a trend.

Only last week Twitter changed the way posts are displayed in the timeline feed,
allowing photos and video previews to appear without needing to click on a link -
a move some analysts say will help advertisers to better show off their content.
Twitter tends to charge its advertisers according to the amount of interaction their
content generates.

A budget is usually set at the start of the campaign and then the advertiser pays
per click or per re tweet.
It also has a "bidding" system in which advertisers compete with each other to
have their content appear in a particular space. "One of the advantages of Twitter
for marketers over traditional display advertising is they have worked really hard
to make sure that advertising on Twitter is not interruptive," says Lara O'Reilly,
senior reporter at Marketing Week.

Media caption Twitter likely to list on Nasdaq, says Peter Esho from In vast
Financial Services Anything that disrupts the user experience might reduce
engagement from users, which in turn can put off advertisers, Ms O'Reilly says.
"It's not a flashy banner that gets in the way of something. It looks very native,"
she explains. Also, the company takes in a significant portion of its advertising
revenue from
mobile devices - in contrast with Facebook, which had not fully developed its
mobile strategy at the time of its listing.

As of 2013, more than 65% of Twitter's advertising revenue was generated from
mobile devices.

61
More than 75% of Twitter users accessed the site from their mobile phone during
that same time period.
"Because Twitter was born as a mobile platform, they already have this part
sorted," Ms O'Reilly adds. "In investors' eyes, they have a mobile strategy."

2.Firehose :
Data licensing is Twitter's second major revenue stream. The micro-blogger sells
something known as the "firehose", its public data, which often adds up to about
500 million tweets each day. Companies can dive deep into the data to analyse
consumer trends and sell their insight on to other brands and companies.
But Nick Halstead, founder of DataSift, one of the only two companies with
access to the firehose, says that with sophisticated analysis companies can learn
detailed and specific information about their users that, because of the volume of
data, an ordinary user or company would not be able to get.

Twitter Revenue Breakdown

62
4.5 SHARECHAT
Share Chat is an Indian social media start up. It was incorporated by Mohalla Tech
Pvt Ltd on 8 January 2015, and offers the content consumption and sharing
platform only in Indian vernacular languages to cater to over 1.17 billion wireless
network users of India. As of Q2 2019, Share Chat has over 60 million monthly
active users. After its last funding round in August 2019, Share Chat was valued at
$650 million.

HISTORY
Share Chat’s holding company, Mohalla Tech Pvt Ltd, was incorporated in
January 2015 by three IIT Kanpur graduates — Ankush Sachdeva, Farid Ahsan
and Bhanu Pratap Singh. The company is headquartered in Bengaluru, Karnataka,
and presently employs close to 130 people as of March 2019.
Initially, Share Chat primarily worked as a content sharing platform, without any
scope of users generating their own content. In April 2016, Share Chat enabled
usergenerated content creation on its platform, allowing its users to share their
own posters and creative content. At around the same time, it also introduced open
tagging for users, which would allow anyone to create their own hashtags
depending on the content.
As of September 2019, the key people at the hierarchy of Share Chat include
Ankush Sachdeva (co-founder and Chief Executive Officer), Farid Ahsan (cofounder
and Chief Operating Officer), Bhanu Pratap Singh (co-founder and Chief
Technical Officer), Sunil Kamath (Chief Business Officer), Venkatesh
Ramaswamy (Vice President - Engineering) and Debdoot Mukherjee (Vice
President - Data Science). All of the co-founders featured in Forbes’ 30 under 30
Asia 2018, having been recognized for their work with the vernacular social media
platform.
ACQUISITIONS
Clips acquisition
On 2 March 2019, Mohalla Tech acquired Transversal Tech-owned short video
sharing platform, Clip, for an undisclosed amount Prior to the acquisition, Clip
had nearly 10 million MAUs on its platform.
On 21 Feb 2020, sharechat acquired Elaic

63
FUNDING

Share Chat’s initial, seed-round funding was announced on 13 July 2016, with SAIF
Partners and India Quotient providing $1.35 million funding to the social media
startup. Approximately four months later, a Series A funding drive saw the platform
raise a further sum of $4 million from Light speed India Partners and Venture
Highway, alongside its existing backers. The Series A drive was announced on
November 23, 2016

A bigger funding drive came with its Series B round, where it raised an additional
$18.2 million, announced on 18 January 2018. Chinese smartphone giant Xiaomi,
and its sister concern Shunwei Capital were the new investors in this round, while
all four previously existing investors also participated.

On 19 September, 2018, Share Chat’s announced its Series C funding. At $99.85

million, the prime investors of this round were Shunwei Capital, while Xiaomi,
Light speed India and SAIF Partners also invested additional amounts. Furthermore,
the Series C funding round saw the entry of two new financial backers — China’s
Morningside Ventures, and Yuri Milner’s DST Global-affiliated venture capital firm,
Jesmond Holdings.

In August 2019, ShareChat raised $100M funding from Twitter, Shunwei Capital,
Light speed Venture Partners, SAIF Capital, India Quotient and Morningside Venture
Capital, and Trust Bridge Partners. The move is seen as a potential way to counter
the rising threat of Byte Dance in India, which is backed by Japan’s venture capital
powerhouse Softbank Group and others, and is presently the world’s highest
valued internet start-up

64
Share Chat Capital Raised

REVENUE

Share Chat Business Model:

There are two categories of content network on the Internet.
The first category comprises of those networks where the content is created and
owned by the platform creators. A typical news website would fall into this
category.
The second is a user generated content network where the bulk of the content is
created by the users. Share Chat falls into the latter category.
Share Chat like many other social networks, allow users to share content like
pictures and videos with other users, engage with other user created content on the
network as well as make friends and interact with fellow users on the network.
Share Chat however differentiates itself from other social networks by providing
the entire user experience in a regional language.

65
Share Chat Revenue Model:
Share Chat like most other user-generated content platforms makes money through
advertising. Typically, a user generated content based social network like Share
Chat would collect, store and analyse data relating to:
• Searches a user’s performs on the network.
• Usage habits including the posts he/she has interacted with.
• Communications entered into with other users

66
4.6 HIKE MESSENGER

Hike Messenger also called Hike Sticker Chat is an Indian cross-platform instant
messaging (IM), Voice over IP (VoIP) application which was launched on 12
December 2012 by Kavin Bharti Mittal and is now owned by Hike Private
Limited. Hike can work offline through SMS and has multi-platform support. The
app registration uses standard one time password (OTP) based authentication
process. With abundance of low-cost data, Hike decided to go from a single super
app strategy to multiple app approach, so that it can focus more on the core
messaging capabilities. From version 6, the user-interface was revised and the app
no longer support features like news, mobile payment, games or joke. As per CB
Insights, $1.4 billion is the valuation of Hike with more than 100 million
registered users till August 2016 and 350 employees working from Bengaluru and
Delhi.

FUNDING
SR DATE INVESTOR FUNDING AMOUNT
NO TYPE RAISED
1 Apr 25, 2013 Bharti Soft Bank Series A $7 m
2 Mar 31, 2014 Bharti Soft Bank Series B $14 m
3 Aug 26, 2014 Tiger Global Series C $65 m
Management
4 Jan 11, 2016 Matt Mullenweg, Venture round
Ruchi Sanghvi,
Traveon Rogers,
Aditya Agarwal
5 Aug 16, Soft Bank Series D $175 m
2016 Capital, Tiger
Global
Management,
Tencent
Holdings,Foxconn
Technology
Group, Bharti
Enterprises.

67
Hike raised its first round of funding of $7 million from Bharti Enterprises and Soft
Bank Group on April 2013. It again received a second round of investment of $14M
from Bharti Enterprises and Softbank Group on March 2014 to scale up operations
when it crossed 15 million subscribers. On August 2014, Hike reached 35 million
users and raised $65 million in a funding round led by Tiger Global. It raised $175
million in a Series D round of funding led by Tencent & Foxconn on 16 August 2016.

Hike Capital Raised

Hike Messenger's loss narrowed to Rs 205.6 crore in the financial year ended March
2019, a drop of 106 percent, as compared to a loss of Rs 423 crore it incurred in
FY18. For the same period, the messaging app reported its revenue to be at Rs 26.5
crore, a decline of 33 percent from Rs 39.5 crore in the FY18, even as the company
trimmed its expenses by almost half, documents filed with Registrar of Companies
(RoC) stated. Of the total revenue generated in FY19, Rs 3.5 lakh was from the
operating income, while the balance of Rs 26.4 crore was from the ‘other income’
category. The company's total expenses also decreased to Rs 231.9 crore in FY19,
compared to Rs 462.5 crore it spent during the previous financial year. The messaging
platform trimmed its employee benefits expense which was reported to be at Rs 109
crore in FY19 as compared to Rs 172 crore in FY18. Hike had raised around $175
million led by Tencent in a Series D round in 2016 when it was valued at around $1.4
billion. Hike acquired Zip Phone on 7 Jan, 2015, Pulse on 29 June, 2017, CREO Tech
on 11 Aug, 2017.

68
 5. DATA REPRESENTATION AND INTERPRETATION

5.1 PRIMARY DATA:

1) Gender
30 responses
Male Female Prefer not to say

30%

70%

INTERPRETATION:
From the above pie
chart it has been seen that 70% of the sample size is Male and 30% of the sample size
is Female. Out of 30 people 20 are Male and 10 are Female.

2) Age Group
30 responses
18-25 25-40 40-60 Above 60
3% 7%

90%

INTERPRETATION:
From the above pie chart, 90% of the respondents are between the age group of 18-25
and 3% of the respondents are between 25-45 and 7% of the respondents are between
40-60, Number of Old peoples Above 60 is 0%.

69
 3) Employment Status
30 responses
Unemployed Self-Employed Employed
Retired Housewife Student

13%

17%

3%
67%

INTERPRETATION:
From the above pie chart, it is seen that of the 67% respondents work are student,
17% of the respondents are Employed, 13% of the respondents are Unemployed and
3% of the respondents are Housewife.

Particular Percentage % No.of Peoples

Student 67.7% 20
Employed 16.7% 5
Unemployed 13.3% 4
Housewife 3.3% 1
Total 100% 30

70
 4) Do you use Social Media?
30 responses
Yes No Sometimes

10%

90%

INTERPRETATION:
From the above pie chart it is shown that almost all the respondents use some or the
other social media site. 90% of the people use social media and 10% don’t use it.
That means out of 30 respondents 27 use social media and only 3 does not use social
media. In this living day and age social media is a must.

71
 5) Which Social Media App are you most active on?
30 responses

Instagram Facebook Snapchat Twitter Whatsapp Telegram LinkedIn

Youtube Pinterest Gmail Other

3%
5% 10% 19%

6%

17%

10%

5% 16%
6%
3%

INTERPRETATION:

From the pie chart above, it is proved that Instagram is the most used social media
site. 19% of the respondents use Instagram, 6% respondents use facebook, 10%
respondents use Snapchat, 3% respondents use Twitter, 16% respondents use
Whatsapp, 6% respondents use Telegram, 5% respondents use LinkedIn, 17%
respondents use Youtube, 5% respondents use Pinterest, 10% respondents use Gmail
and other 3% respondents uses Reddit,Spotify,Sharechat,HikeMessenger.

Social Media Sites Percentage % No. of People

Instagram 90% 27
Facebook 30% 9
Snapchat 46.7% 14
Twitter 13.3% 4
Whatsapp 76.7% 23
Telegram 26.7% 8
LinkedIn 23.3% 7
Youtube 80% 24
Pinterest 23.3% 7
Gmail 46.7% 14
Other –
Reddit 3.3% 1
Spotify 3.3% 1
Sharechat 3.3% 1
HikeMesenger 3.3% 1
Total 469.9% 30

72
 6) How much time do you spend on Social Media each
day?
30 responses

15 min-30 min 30 min-1 hr 1 hr-2 hr More than 2 hr

13%

17%

53%

17%

INTERPRETATION:
From the above pie chart it is seen that 13% use social media for 15 mins to 30 min,
17% use for around 30 mins-1 hr, 17% use for 1 hr-2 hr, and 53% use for around
more than 2 hrs.

Particular Percentage No.of People

15 min-30 min 13% 4
30 min-1 hr 17% 5
1 hr-2 hr 17% 5
More than 2 hr 53% 16
Total 100% 30

73
 7) How long have you been on Social Media?
30 responses
Less than a Month 1-6 Months 7-2 Months
1-2 Years More than 2 Years
3% 3%
10%

83%

INTERPRETATION:
From above pie chart, 84% people are there on social media for more than 2
years, 10% are there in between 1-2 years,0% are there in between 7-2 months, 3%
are there in between 1-6 months and 3% are there from less than a month.

Time Percentage% No.of People

Less than a Month 3% 1
1-6 Months 3% 1
7-2 Months 0% 0
1-2 Years 10% 3
More than 2 Years 84% 25
Total 100% 30

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 8) Do you know how Social Media earn
money ?
30 responses
Yes No Somewhat
20%

20% 60%

INTERPRETATION:
From the above chart it is seen that many people do not know how social media
sites earn money. It is seen that 20% audience clicks somewhat bcause they do not
exactly know how social media sites earn money also 60% respondants know how
social media earns money and 20% do not know.

9) If you get a chance, would you investin Social

Media ?
30 responses
Yes No Maybe
37%

57%

7
%

INTERPRETATION:
From the above chart it has been seen that 46.7% people would like to invest in social
media, 33.3% may invest, and 20% won’t invest in social media. This means 14
respondents want to invest in social media, 10 respondents are
confused and 6 respondents would not invest in social media.

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 10) Do you believe that business will archive better
results when it comes to customer loyalty and profit if
Social Media is integrated into marketing ?
30 responses
Yes No

100%

INTERPRETATION:
From this chart it is concluded that 100% respondents believe that business will
archive better result to stimulate advance in customer loyalty and excess benefit
business opportunities in Social Media which will integrate into marketing.

11) Do you think Social Media helps to grow

business opportunities ?
30 responses
Yes No Maybe

3%

97%

INTERPRETATION:
From this chart it is concluded that 97% respondents think that social media
helps grow business opportunities and 3% respondents maybe thinking social media
will helps growing business opportunities.

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 12) Which are the top Social Media Advertising
platforms ?
30 responses
Youtube Facebook
5% Instagram LinkedIn
11% 19%
Telegram Twitter Gmail Others
10%

17%
7%

11% 21%

INTERPRETATION:

From the above chart it is concluded that respondants favouriate Social Media
Advertising platform is Instagram which is 21% , Youtube is the second top Social
Media Advertising platform which is 19%, also 17% peoples acknowledged
Facebook, 11% agreed Gmail and LinkedIn, 10% admit Twitter, 7% concede
Telegram and 4% sympathize other which includes
Snapchat,Whatsapp,Sharechat,HikeMessenger,Pinterest,Spotify.
Social Media Sites Percentage % No.of People
Youtube 83.3% 25
Facebook 73.3% 22
Instagram 90% 27
LinkedIn 46.7% 14
Telegram 30% 9
Twitter 43.3% 13
Gmail 46.7% 14
Others-
Snapchat 5% 1
Whatsapp 3% 1
Sharechat 3% 1
HikeMessenger 3% 1
Pinterest 3% 1
Spotify 3% 1

Total 433.3% 30

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 13) Do you keep up to date with sales and
promotions by using Social Media ?
30 responses
Yes No
23%

77%

INTERPRETATION:
From the above pie chart, some Social Media users keep themself 77% up to date
with sales and promotions while 23% respondants don’t .

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 14) As Social Media aims at connecting people
worldwide, do you think they should work as a
non-profit organisations ?
30 responses
Strongly Agree Agree Nutral Disagree Strongly Disagree

3% 3%
20%

43%

30%

INTERPRETATION:
From the above chart it is concluded that 44% of the respondents are confused,
30% agree that a social media site should function as a npo, 3% disagree with
the statement, 3% of the respondents have a strongly disbelief that a social media
site should work like an npo and 20%% of them strongly believe with the
statement.

Particular Percentage No.of People

Strongly Agree 20% 6
Agree 30% 9
Nutral 44% 13
Disagree 3% 1
Strongly Disagree 3% 1
Total 100% 30

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 15) Which products or services you prefer after
watching ads on Social Media?
30 responses
Home Appliences Fashion products Groceries
Beauty products others
12% 25%

20%

13% 30%

INTERPRETATION:
From the above pie chart it is seen that 30% of the respondents are prefering Fashion
products, 25% prefer Home Appliences, 20% prefer Beauty products, 13% prefer to
Groceries and 12% others prefer after watching ads of products and services on Social
Media.

Products and Services Percentage % No.of People

Home Appliances 63.3% 19
Fashion products 76.7% 23
Groceries 33.3% 10
Beauty products 50% 15
Others 30% 9
Total 253.3% 30

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 5.2 SECONDARY DATA:

5.2.1 FUNDING OF SOCIAL MEDIA:

SEED MONEY Seed money, sometimes known as seed funding or seed capital,
is a form of securities offering in which an investor invests capital in a start-up
company in exchange for an equity stake or convertible note stake in the company.
The term seed suggests that this is a very early investment, meant to support the
business until it can generate cash of its own (see cash flow), or until it is ready for
further investments. Seed money options include friends and family funding, seed
venture capital funds, angel funding, and crowdfunding.
Seed capital can be distinguished from venture capital in that venture capital
investments tend to come from institutional investors, involve significantly more
money, are arm's length transactions, and involve much greater complexity in the
contracts and corporate structure accompanying the investment. Seed funding
involves a higher risk than normal venture capital funding since the investor does
not see any existing projects to evaluate for funding. Hence, the investments made
are usually lower (in the tens of thousands to the hundreds of thousands of dollars
range) as against normal venture capital investment (in the hundreds of thousands
to the millions of dollars range), for similar levels of stake in the company. Seed
funding can be raised online using equity crowd funding platforms such as Seed
Invest, Seeds and Angels Den. Investors make their decision whether to fund a
project based on the perceived strength of the idea and the capabilities, skills and
history of the founders.
Angel: An angel round is typically a small round designed to get a new company
off the ground. Investors in an angel round include individual angel investors,
angel investor groups, friends, and family.

The Phases of Investment:

A start up generally has to move through four distinct phases of investment before
it is truly established: Seed capital, venture capital, mezzanine funding, and an
initial public offering.

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Seed capital and venture capital are often used as synonyms, and in reality, they
tend to overlap. Generally, seed capital is used to develop a business idea to the
point that it can be presented effectively to venture capital firms that have large
amounts of money to invest. If they like the idea, those firms generally get a stake
in the new venture in return for investing in its development. Venture capitalists
provide the lion's share of the money needed to start a new business.

The Role of the Angel Investor:

Professional angel investors sometimes provide seed money either through a loan
or in return for equity in the future company. They often enjoy a hands-on role in
helping develop a company from scratch.
If the angel investor is contributing under $1 million, the money is usually in the
form of a loan. For the entrepreneur, this can solve the problem of attracting
sufficient seed money, given the reluctance of banking institutions and even
venture capitalists to take on considerable risk.
When contributing more than $1 million, an angel investor typically prefers seed
equity and becomes a co-owner of the start-up and the holder of preferred stock
with voting rights.
Because there are no public exchanges listing their securities, private companies
meet venture capital firms and other private equity investors in several ways,
including warm referrals from the investors' trusted sources and other business
contacts; investor conferences and demo days where companies pitch directly to
investor groups. As equity crowdfunding becomes more established, start-ups are
increasingly raising part of their Series A round online using platforms such as
Onevest or Seed Invest in the USA and Seeds in the UK.
Smaller investment amounts are usually not worth the legal and financial expense,
the burden on a company of adjusting its capital structure to serve new investors,
and the analysis and due diligence on the part of institutional investors. A company
that needs money for operations but is not yet ready for venture capital will
typically seek angel capital. Larger amounts are usually unwarranted given the
cost of business in fields such as software, data services, telecommunications, and
so on

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2. SERIES A
Series A financing (also known as series A round or series A funding) is one of the
stages in the capital-raising process by a start-up. Essentially, the series A round is
the second stage of start-up financing and the first stage of venture capital
financing. Similar to seed financing, series A financing is a type of equity-based
financing. This means that a company secures the required capital from investors
by selling the company’s shares. However, in most cases, series A financing comes
with antidilution provisions. Start-ups usually issue preferred shares that do not
provide their owners with voting rights.

Objectives of Series:
A Financing Series A financing is primarily used to ensure the continued growth
of a company. The common goals in the series A round include reaching
milestones in product development and attracting new talent. In this stage of
development, a company intends to continue the growth of its business to attract
more investors to future rounds of financing.
In the series A round, the biggest investors are venture capital firms. Commonly,
they are firms that specialize in investments in early-stage companies. The general
rule is that capital is provided to companies that already generate revenues but are
still in the pre-profit stage.

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How Does Series A Financing Work?
Unlike seed capital, series A financing follows a strictly formal approach. Venture
capitalists that represent the majority of investors in this round of financing are
willing to complete the due diligence and valuation process before making an
investment decision. Thus, these processes start every substantial series A funding.
The valuation of a start-up is an essential part of series A financing. Unlike startups
in the seed stage, companies looking to secure series A capital are able to
provide more information that can be used to make informed investment decisions.
The goals of valuation in series A fundraising include the identification and
assessment of progress made by a company using its seed capital, as well as the
efficiency of its management team. Additionally, the valuation process
demonstrates how well a company and its management use the available resources
to earn profits in the future. Only when the due diligence and valuation processes
are completed will venture capitalists invest in a company.

3. SERIES B
Series B financing (also known as series B round or series B funding) is one of the
stages in the capital-raising process of a start-up. Essentially, the series B round is
the third stage of start-up financing and the second stage of venture capital
financing.

How Does Series B Financing Work?

Similar to the previous stages of financing that include seed and series A
financing, the series B round is a type of equity-based financing. In other words,
investors provide capital to a company in exchange for the latter’s preferred
shares. The majority of the deals include anti-dilution provisions like in the series
A round. This means that a company usually sells preferred shares that do not
provide its holders with voting rights. However, the shares often come with a
convertibility option (i.e., the holders of the preferred shares can convert their
shares into common stock at a future date).
Series B financing is appropriate for companies that are ready for their
development stage.

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The proceeds from the series B round are primarily utilized to support the
company’s growth to the next level. The capital raised can be used in various
ways, such as sales, marketing, talent acquisition, and developing new
technologies.

4. SERIES C
Series C financing (also known as series C round or series C funding) is one of the
stages in the capital-raising process by a start-up. The series C round is the fourth
stage of start-up financing, and typically the last stage of venture capital financing.
However, some companies opt to conduct more rounds, such as series D, E, etc.

How Does Series C Financing Work?

Similar to previous stages of financing, the series C round primarily relies on
raising capital through the sale of preferred shares. The shares are likely to be
convertible shares. They offer holders the right to exchange them for common
stock in the company at some date in the future.
Strictly speaking, companies that aim to obtain series C funding are no longer
startups. They are usually established, successful companies in their late stages of
development, with solid revenues and profits. Their core products or services
generate strong demand in the marketplace, attracting a substantial customer base.
Companies seek series C financing for further expansion to reinforce their existing
success.
Following a series C round, a company aims to scale up its operations and
continue its growth. The proceeds from this financing round are most commonly
used for entering new markets, research and development, or acquisitions of other
companies.
5.2.2 REVENUE OF SOCIAL MEDIA

Business Model vs Revenue Model vs Revenue

Stream Before we delve into the different types of revenue models, we should
spend a little time differentiating between the terms "business model", "revenue
model", and "revenue stream", as they are very often used interchangeably. In the
GlowingStart article, "What Is the Difference Between A Revenue Model,

85
Revenue Stream and a Business Model", Alex Genadinik does a great job explaining
the difference between those terms. They are summarized below
• A revenue stream is a company’s single source of revenue. A company can have
zero or many revenue streams, depending on its size
• A revenue model is the strategy of managing a company’s revenue streams and
the resources required for each revenue stream.
• A business model is the structure comprised of all aspects of a company,
including revenue model and revenue streams, and describes how they all work
together.

Types of Revenue Models

Here are the revenue models he covers below:
1. Ad-Based Revenue Model:
Ad-based revenue models entail creating ads for a specific website, service, app,
or other product, and placing them on strategic, high-traffic channels. If your
company has a website or you have a web-based company, Google’s AdSense is
one of the most common tools get ads. For most websites, AdSense will earn about
$5-10 per 1,000-page views
. • Advantages: Making money from ads is one of the simplest and easiest ways to
implement revenue models, which is why so many companies utilize ads as a
source of revenue
. • Disadvantages: In order to generate sufficient revenue to withhold a business,
you will need to attract millions of users. In addition, most people find ads
annoying, which can lead to low clickthrough rates, and therefore, lower revenue.
2. Affiliate Revenue Model:
Another popular web-based revenue model is the affiliate revenue model, which
works by promoting links to relevant products and collecting commission on the
sales of those products and can even work in conjunction with ads or separately.
• Advantages: One of the most obvious benefits of employing an affiliate revenue
model is that it generally makes more money than ad-based revenue model

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• Disadvantages: If you use an affiliate revenue model for your start-up, remember
that the amount of money you make is limited to the size of your industry, the
types of products you sell, and your audience.
3. Transactional Revenue Model:
Countless companies, both tech-oriented and otherwise, strive to rely on the
transactional revenue model, and for good reason too. This method is one of the
most direct ways of generating revenue, as it entails a company providing a
service or product and customers paying them for it.
• Advantages: Consumers are more attracted to this experience because of its
simplicity and the wider set of options.
• Disadvantages: Because of the directness of the transactional revenue model,
many companies employ it themselves, which means more competition and price
deterioration, and therefore, less money to made for everyone who uses this
model.
4. Subscription Revenue Model:
The subscription revenue model entails offering your customers a product or
service that customers can pay for over a longer period of time, usually month to
month, or even year to year.
• Advantages: If your company is far enough along in its development, this model
can generate recurring revenue, and can even benefit from customers who are
simply too lazy to cancel their subscription to your company (which is the dirty
little secret of a subscription-based model).
• Disadvantages: Because this model depends so much on having a large
consumer base, it’s critical to maintain a higher subscribe rate than an unsubscribe
rate.
5. Web Sales:
This is an offshoot of the transactional revenue model, in which a customer pays
directly for a product or service, except that customers must first come to your
company via a web search or outbound marketing, and conduct transactions solely
over the internet.

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• Advantages: Web sales work with a wide variety of offerings, including software,
hardware, and even subscription services
• Disadvantages: Relationship sales are incompatible with the web sales model,
so if your company is related to consulting or big ticket items (high-value items
such as houses, appliances, and cars), you should consider employing a model
that’s more suited to your offering.
6. Direct Sales
There are two types of direct sales: inside sales, in which someone calls in to place
an order or sales agents calling prospects; and outside sales, which is a face to face
sales transaction.
• Advantages: Direct sales models work great with relationship sales cycles,
enterprise sales cycles, or complex sales cycles that entail multiple buyers and
influencers.
• Disadvantages: The direct sales model often requires hiring a sales team of some
sort, which means that it isn’t optimal for small ticket price items. If your offering
is priced below the $1,000-$2,000 range, you’ll have trouble building a scalable
company.
7. Channel Sales (or Indirect Sales)
The channel sales model consists of agents or resellers selling your product for
you and either you or the reseller delivering the product. The affiliate revenue
model is a good companion model to this one, especially if your offering is a
virtual product.
• Advantages: The channel sales model is ideal for companies who have a product
that’s an incremental sale for their channel and can produce incremental profit
• Disadvantages: Don’t employ this model if your product requires you to
evangelize your marketplace, or if your product competes with that of your
partner’s, as they will push theirs and not yours.
8. Retail Sales
Retail sales entails setting up a traditional department store or retail store in which
you offer physical goods to your customers. Keep in mind that the retail sales
model.

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will require shelf space (that you’ll have to pay for) at existing stores, and is best
suited for products that require logistics to reach your customers.
• Advantages: Retail sales is a great way to offer deals and complimentary
products to an existing customer base to help boost brand awareness.
• Disadvantages: The retail sales route is not ideal for early stage companies, or
companies that offer digital products like software or apps.
9. Product is Free, But Services Aren’t
This model is unique compared to others, in that you have to give your product
away for free, yet require customers to pay for installation, customization, training
or other additional services.
• Advantages: This model is great for building trust with your customer base and
boosting brand awareness, as any company that offers anything for free will
generate considerable buzz.
• Disadvantages: Remember, employing this model means that you are basically
running a services business with the product as a marketing cost and this model
isn’t always the best for scaling your company in the long term, so keep your eye
on additional revenue models to utilize later on.
10. Freemium Model
The freemium model is one in which a company’s basic services are free, yet users
must pay for additional premium features, extensions, functions, etc. One of the
biggest companies to use this model is Linkedin, the most popular business/social
media platform.
• Advantages: Similar to the previous model, the freemium model offers
something free to users, which is a great way to give them a taste of your product
or service while simultaneously enticing them to pay for something later on.
• Disadvantages: This model requires a considerable investment of time and
money to reach out to your audience, and even more effort to convert free users
into paying customers.
1. Cost-per-mile or cost-per-impressions (CPM) – is a payment model
based on a number of impressions. The advertiser is charged each 1,000 time the
affiliate ad is displayed (mille is a Latin translation for thousand). iOS ads are
generally more

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Affiliate expensive than ads displayed on Android devices and can differ up to
30% over the platform.
The average mobile revenue per thousand impressions (RPMs);
Banners: iOS ($1.20 – $3.00) vs Android ($1.15 – $2.50)
Interstitials: iOS ($4.00 – $6.00) vs Android ($3.00 – $4.00)
The highest end of CPM rates belongs to Ad Mob network operated by Google. As
of July 2016, the CPM rate has reached $6 for Android and $10 for iOS per 1,000
mobile ad impressions.
2. Cost per mile (CPM) - also called cost per thousand (CPT), is a commonly
used measurement in advertising. It is the cost an advertiser pays for one thousand
views or clicks of an advertisement. Radio, television, newspaper, magazine, outof-
home advertising, and online advertising can be purchased on the basis of
exposing the ad to one thousand viewers or listeners. It is used in marketing as a
benchmarking metric to calculate the relative cost of an advertising campaign or
an ad message in a given medium.
3. Cost-per-click (CPC) – is a revenue model based on the number of clicks on
an ad displayed. Such popular ad networks like Ad fonic and Google's Ad Mob are
commonly PPC, providing both text and display advertisements.
4. Pay-per-click (PPC) - is an internet advertising model used to drive traffic to
websites, in which an advertiser pays a publisher (typically a search engine,
website owner, or a network of websites) when the ad is clicked.
Pay-per-click is commonly associated with first-tier search engines (such as
Google Ads and Bing Ads). With search engines, advertisers typically bid on
keyword phrases relevant to their target market. In contrast, content sites
commonly charge a fixed price per click rather than use a bidding system. PPC
"display" advertisements, also known as banner, ads, are shown on web sites with
related content that have agreed to show ads and are typically not pay-per-click
advertising.
5. Cost per sale networks (CPS) -With CPS revenue model, also known as pay
per sale, the app developer is charged only after a purchase has been completed.
The app publisher gets fixed commission or percentage of the sale.

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ShareASale, Rakuten Linksh, and Amazon Associates are high paying, secured CPS
networks, especially popular among developers.
6. Pay-per-sale or PPS -(sometimes referred to as cost-per-sale or CPS) - It is an
online advertisement pricing system where the publisher or website owner is paid
on the basis of the number of sales that are directly generated by an advertisement.
It is a variant of the CPA model, where the advertiser pays the publisher and/or
website owner in proportion to the number of actions committed by the readers or
visitors to the website.
7. Cost per view (CPV) – is a type of charging based on the number of video
views or ad interactions, such as clicks on banners or call-to-action overlays.
Mobile games developer Bright house successfully operated Cost per view
networks to increase app revenue by 130%.

II. Advertisement
1. Interstitial ads
These ads are the full-screen pop-ups, displayed at specific time frame. The ad
can be closed by opening the promoted page or by a close button in the ad corner.
This method to boost app revenue is efficient at natural transition breaks mostly
for messaging and content apps, news, and for games, before or after an expected
content or functionality (e.g. game levels) and can be used to maximize
impressions.
An interstitial video can function as a natural transition and is deployed to
monetize apps without interfering with the user experience. Interstitial video ads
are popular in gaming apps and others that have marked transitions, as these
moments offer the best space to naturally integrate these types of ads. Interstitial
video ads are often used more extensively in apps that have more straightforward
and uncomplicated in-game economies.
Including interstitial video ads offers you a reliable way to boost ad revenues and
improve your app monetization. One of the big benefits interstitial videos offer is
that they are dynamic, so they offer a more engaging ad experience than static ads
or banner ads. When they’re placed at natural transition points in the in-app
experience, they also offer less disruption to users’ app experiences. Finally,
interstitial video ads can also deliver higher e-CPM rates than some other ad types.

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Unlike banner ads which can often be overlooked by users, interstitial video ads
are more likely to be viewed because they occur within the app’s flow and take up the
entire screen, meaning advertisers will pay more.
2. Banners or display ads
These ads are usually appear in different sizes and stretch at the top or bottom part
of the screen. They are small and less obtrusive so users can freely interact with
the app. Besides, app developers can target tailored users based on demographics
and past behaviours. Still, they have low engagement rates of about 0.1% CTR.
Digital display advertising is graphic advertising on Internet websites, apps or
social media through banners or other advertising formats made of text, images,
flash, video, and audio. The main purpose of display advertising is to deliver
general advertisements and brand messages to site visitors.
According to eMarketer, Facebook and Twitter will take 33 percent of display ad
spending market share by 2017.
3. In-app video ads
These ads are displayed automatically, used as a ‘rewarded video’ – opened
ondemand in exchange for any in-app reward. For instance, the user can get app
currency, extra lives in games or additional features for watching video add. This
is a win-win strategy both for app providers and customers.
4. Native ads
are created to fit seamlessly the main concept design and appear within the app as
its natural element. Mostly, it manifests as sponsored content or video, aimed to
promote a product. As native advertising are considered by users to be as less
irritating and intrusive, they get more popular revenue stream for app providers.
Native advertising is a type of advertising that matches the form and function of
the platform upon which it appears. In many cases it functions like an advertorial,
and manifests as a video, article or editorial. The word "native" refers to this
coherence of the content with the other media that appear on the platform.

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These ads reduce a consumers' ad recognition by blending the ad into the native
content of the platform, using somewhat ambiguous language such as "sponsored"
or "branded" content. They can be difficult to properly identify due to their
ambiguous nature.
Native advertising works. Consumers look at native ads 53% more than display
ads. Native ads create an 18% increase in purchase intent, and the visual
engagement with native ads is the same, and even slightly higher, than the original
editorial content.
Using a mix of ad formats and placement can generate maximum revenue to
developers and engagement to users.
Downside: Ad revenues can be pretty low for apps with a small audience. Despite
advertisement is wide used by developers, it remains the most hated by users, so it
should become a part of the interaction and act as its natural part.
5. Incentivized Ads (reward users for app engagement)
84% of app users prefer rewards apps over applications containing ads. There is a
number of tools that allow rewarding consumers on completion of a certain in-app
action, ad interaction, through filling out a survey. The strategy allows creating
better engagement and building positive brand attitude. App developers get
revenue from promoting their in-app currency by sponsors and gain happy and
loyal users.
84% of users prefer rewards apps over apps containing ads 91% of users interacting
with incentivized ads actively pay attention to the brand behind it. Run Keeper is a
pioneer in using this revenue model. The app for tracking running activity and
workouts uses incentivized ads, giving ability for users to unlock exclusive rewards
and features without disrupting engagement with display and interstitial ads
Incentivized advertising is a new ad format that is gaining popularity in digital
mobile advertising. In incentivized advertising, the publisher rewards users for
watching an ad. An endemic issue here is adverse selection, where reward-seeking
users select into incentivized ad placements to obtain rewards. We find that
rewarding users to watch an ad has an overall positive effect on the ad conversion
rate However, there is a negative offsetting effect that reduces the effectiveness of
incentivized ads. Some users are averse to delayed rewards, they prefer to collect
their rewards immediately

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after watching the incentivized ads, instead of pursuing the content of the ads
further. For the subset of users who are averse to delayed rewards, the treatment
effect is only 13%, while it can be as high as 47% for other users.
Downside: Rewards should look like a part of app interaction and it is hard to
keep users involved in the app.

III. Collecting and Selling Data

Well, this is probably not the most widespread and ethical way of app
monetization (and that’s great), but collecting and selling personal data still
remains one of the effective approaches to turn a profit.
Some companies that offer free mobile apps sell their databases to third parties.
The information may contain user’s email address, social media accounts, and
personal preferences.
Apps generate a lot of data in terms of user behaviour, which is highly desired by
those who are in different research fields.
So app developers can sell this kind of information to the researchers and make
quite a good return of money. Actually, there are two ways to earn on selling data:
track what users do and sell data to outside companies or use the raw data itself for
your own purposes.
From a marketing point of view, companies want to pay to display ads to the most
relevant audience possible; while on the flip side, far not each service can gather
the same data as Facebook or Google does. Nevertheless, if your app is able to
gather relevant data, then you may have a way to profit from it.
The data that social networks have accumulated is potentially very valuable. By
aggregating this relationship data and making it anonymous, communities can find
third-parties willing to pay for it.
It will be important that the sold information doesn’t invade anyone’s privacy, but
that’s an entirely different issue. So long as the data contains our wants, needs,
likes, dislikes, and interests, its value cannot yet be measured.
Downside: the worst of the apps can even infiltrate the call history and contact
lists or access users’ social media accounts. The good thing is that there are
antisurveillance

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tools that can help you protect yourself from spying (e.g. Text Secure, Red Phone,
Onion Browser, Or bot, etc.).
As you know, apps collect a lot of users’ data, in terms of user behaviour or other
app usages. All these user behavioural data are desired by many researchers in
different fields.
This means the app publishers can sell their users’ behaviour data to these
researchers and make a handsome amount of money. The data generally contains
users’ email addresses, social media accounts, and personal preferences.
There are two ways to benefit from this model. You can either track what users do
and sell data to outside companies and researchers, or you can use the raw data for
your own purposes.
From a marketing point of view, companies want to pay for displaying ads to the
most relevant audience. So, if you can gather enough relevant data, then you can
have a way to make a profit out of it.
PROS
• Through this model, you will easily avail of consumer segmentation and make
the buying process quite easy.
• Such data is a helpful tool in identifying and listening to consumer voices and
make them avail to apt companies.
• It can result in genuine monetization app model.
CONS
• Disclosure of a consumer’s data.
• It is tough to maintain accountability with customers
• It is hard to govern customer data security.

How do businesses collect your data?

There are several ways companies use the consumer data they collect and the
insights they draw from that data:

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1. Improving customer experience
For many companies, consumer data offers a way to better understand and meet
their customers' demands. By analysing customer behaviour, as well as vast troves
of reviews and feedback, companies can nimbly modify their digital presence,
goods or services to better suit the current marketplace.
2. Refining marketing strategy
Contextualized data can help companies understand how consumers are engaging
with and responding to their marketing campaigns, and adjust accordingly. This
highly predictive use case gives businesses an idea of what consumers will want
based on what they have already done. Like other aspects of consumer data
analysis, marketing is becoming more about personalization as a result, said Brett
Downes, SEO manager at Ghost Marketing.
3. Turning data into cash flow
Companies that capture data also stand to profit from it. Data brokers, or
companies that buy and sell information on customers, have risen as a new
industry alongside big data. For businesses that are capturing large amounts of
data, this represents an opportunity for a new stream of revenue.
For advertisers, having this information available for purchase is immensely
valuable, so the demand for more and more data is ever increasing.
4. Using data to secure data
Some businesses even use consumer data as a means of securing more sensitive
information. For example, banking institutions will sometimes use voice
recognition data to authorize a user to access their financial information or protect
them for fraudulent attempts to steal their information
.
IV. Offering Premium Options
While some social networks are completely free, others might offer a premium
option to its user’s in an attempt to earn some money. LinkedIn, for example, has a
premium

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package for job seekers. All of your networking options are free with LinkedIn,
but if you want special privileges you have to sign up for one of their premium
options. An interesting example that took place recently was Ning. Although Ning
has millions of users, they recently made the announcement to suspend their free
services and concentrate solely on their premium model. They also were forced to
cut several jobs.
This shows just how difficult it is to monetize social networking.
When it comes to talking about freemium upsell, freemium apps are available free
of cost to download but contain paid or premium features.
In this type of freemium model apps, users download the app without paying any
charge, and if they like the content of it, they can get full access to functionality by
committing a purchase. Using this tactic, gaining lots of new users is easily
possible because premium features are optional.
PROS:
• No intrusive ads.
• This model is compatible with any other approaches.
• It is a low maintenance app monetization tactic.
• This model has wide reached as it is free for the users.
CONS:
• Revenue fluctuations.
• All maintenance costs are on you, as the app is free of cost.
• Users have spent nothing on the app, thus they can easily abandon it

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 6. CONCLUSION

Social media can be a powerful tool for any organization. It can increase your
visibility, enhance relationships, establish two-way communication with
customers, provide a forum for feedback, and improve the awareness and
reputation of the organization. For these reasons, social media websites have
become an important platform for organizations. As organizations “focus on
effectively leveraging social media platforms, there are a few critical things to
keep in mind”. Organizations must first develop a comprehensive social media
communication strategy and then incorporate best practices in the implementation
of that strategy. Following this guide can help the organization effectively and
successfully derive the maximum benefit from their social media initiative.
Social media was created to help people maintain connections, network, and
obtain information. Recently, almost everybody has at least one account on a
social networking website. Even people that have little desire to see the thoughts
and opinions of hundreds of “friends” find themselves creating accounts. This is
because nobody wants to be left behind in our fast-paced, advancing world of
technology. If people’s friends and peers have a social media account, they are
bound to create one as well. Supporters of social media claim that it improves the
social connections of people. “People communicate and manoeuvre in these
networks rather than being bound up in one solitary community”. Social media
allows you to interact with your community no matter where you are or who you
are with. According to social media supporters, connecting with your community
via the internet makes you less lonely. In actuality, social media has isolated
people. Studies have shown that outgoing people become lonely and depressed
due to social media use (Staples.) Frequently, new relationships are sparked
because of networking and mutual friends through social media. Unfortunately,
these relationships are often low quality. Virtual communication is much less
sincere than face-to-face interaction. Engaging with strangers over the internet can
be unsafe and leave users with a lack of social skills. Social media can be a great
tool if used correctly, but more often than not, people misuse and abuse it.
In conclusion, social media is, and will continue to be, harmful, unless something
is done about it. The power it has over people is dangerous and often goes

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unnoticed. People should care because if not addressed, or taken care, of social
media could cause national and international problems. Social media stunts
interpersonal growth and increases narcissism in many internet users. Even if the user
is not psychologically affected by social media, they are still in danger. Nobody is
immune to the harmful side effects social media including identity theft, stalkers,
or hackers. Social networking allows hoaxes and false information to cause
widespread chaos. “The dark side of social media is that, within seconds, anything
can be blown out of proportion and taken out of context. And it is very difficult not
to get swept up in it all” If there are no regulations or limitations on social media,
the repercussions will accumulate. People need to change the destructive patterns
of social media use before it destroys society. The fast, easy access to information
that is supposed to be beneficial to society is actually detrimental to society.
The same applies to broadcast television and most of all to social media sites. In
theory, Facebook could just charge that $8.52 average worldwide revenue per user
directly to the user, on a subscription basis. The problem is that not only would
users either cancel their accounts by the millions—or never agree to pay the
subscription fee in the first place—setting a fee would also eliminate the
possibility of further dynamism and growth.
For a social media site to go from 300 million users to 2.5 billion and beyond,
access has to be easy, almost effortless, and most of all, free. Using an
advertisersupported model, rather than charging each user individually, is
unquestionably the easiest way for Facebook to garner as many users as possible. The
more users on the site, the greater the number of advertisers willing to engage them,
and the more those advertisers are willing to spend. This makes for the most virtuous
of circles for Facebook’s management and shareholders.
From the consumer’s perspective, advertising was originally a way to enjoy a
finished product at a notably reduced cost. Without inserts and placements, the
newsstand and subscription prices of magazines and newspapers would have to be
a multiple of what they are now. In fact, such publications would not be
economically viable at all—the rise in price would necessarily reduce the quantity
sold to practically zero.

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For a social media site to go from 300 million users to 2.5 billion and beyond,
access has to be easy, almost effortless, and most of all, free. Using an advertiser
supported model, rather than charging each user individually, is unquestionably the
easiest way for Facebook to garner as many users as possible. The more users on the
site, the greater the number of advertisers willing to engage them, and the more those
advertisers are willing to spend. This makes for the most virtuous of circles for
Facebook’s management and shareholders.
Early stage firms increasingly use social media to communicate with their target
stakeholders, such as customers and investors. In this study, we investigate
whether the use of social media is associated with increased success in raising
venture capital financing. We argue that social media can improve start-up funding
success through two channels:
1) Enabling investor discovery of potential investment opportunities through
reduction of search costs and
2) Providing additional information to investors for a better evaluation of the
quality of the ventures. Using social media activities on Twitter and venture
financing data from Crunch Base, we find that an active social media presence and
strong Twitter influence (followers, mentions, impressions, and sentiment)
increase the likelihood a start-up will close the round, the amount raised, and the
breadth of the investor pool. In addition, we find that start-up social media activity
is associated with more investment from investors with less information channels
(e.g., angels) and making less industry specialized investments in particular,
consistent with the hypothesis that social media improves an investor’s ability to
discover potential investments.

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 7. SUGGESTIONS

1. Create a Campaign Plan: To set up your fundraising campaign, it's important to

create a plan with your team so you can keep all the moving parts organized. For
example, charity: water had lots of success with its September Campaign. This
campaign asked people born in September to invite their friends and family to
make a donation in lieu of giving gifts, and share the campaign to social media.
2. Decide Which Social Platforms Are the Most Relevant: Before launching a
fundraising campaign, it's a good idea to evaluate how each of your social media
platforms is performing. Identify which ones are the most relevant for reaching
your target audience. Use the analytic tools on each platform to see how your
content is performing with different demographics, and decide where you want to
focus your efforts. For example, if you are trying to reach a younger audience
(ages 18 – 24), 78 percent of this age group uses Snapchat, and 71 percent uses
Instagram. In contrast, Facebook and YouTube are more universally popular across
all age groups. If you're not sure where to start, check out TechSoup's social media
starter kit.
3. Reach Out to Influencers: Sometimes, especially as a smaller organization, it
can be difficult to get the word out about your fundraising campaign. This is where
social media influencers can help. Influencers are typically people who have a
large social media following and are respected within their field or industry. Use
your analytics from email marketing or social media to identify people within your
network who have a large following. Then reach out to them to see if they would
be willing to promote your campaign.
For example, in 2010, Leigh Durst organized a fundraiser at South by Southwest
for victims of Japan's earthquake and strategically engaged influencers. This
resulted in tons of engagement and led to over $125,000 in donations over the
course of a few days.

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4. Select Appropriate Fundraising Tools: Before you can launch your campaign,
you'll need to get set up with fundraising tools. Luckily, there are lots of low-cost
or free options available that nonprofits can use to launch their campaigns. To help
you get started, TechSoup offers discounts on nonprofit fundraising platforms like
CauseVox, Connect2give, and Fundly.
Even social media channels offer tools for fundraising. For example, Facebook
has integrated fundraising tools for nonprofits that make it even easier to fundraise
online.
5. Tailor Your Message to Each Platform: It's important not to use a "cut and paste"
method with your social media content. Each social media platform is
tailored for different types of content, so make sure you use your analytics to
identify what types of content garner the most engagement on each channel. Here
are some tips on leveraging different types of content on Instagram and LinkedIn,
for example.
6. Show Your Supporters How Their Donation Can Make a Difference: The power
of social media lies in its potential for storytelling, and this is where you can make
your fundraising campaign stand out. Use photos and videos to show your
nonprofit in action so your audience can see how their donations can help your
organization pursue its mission. Videos are particularly powerful for projecting
your message.
For example, Facebook videos receive 135 percent more organic reach than
Facebook photos (on average). Beyond visual content, consider using statistics or
Infographics to give people a tangible idea of how the donations will be put to use.
(For example: "For every $20 donated, we can provide 10 new books to students
in underprivileged schools.")

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 8. BIBLIOGRAPHY

https://computer.howstuffworks.com/internet/socialnetworking/
information/how-social-networking-sites-make-money1.htm
https://thesiliconreview.com/2019/06/how-do-social-media-apps-make-money
https://www.spaceotechnologies.com/how-do-free-apps-make-money/
https://ourworldindata.org/rise-of-social-media
https://www.thestreet.com/technology/how-does-facebook-make-money-
14754098
https://www.businessinsider.in/tech/how-facebook-makes-money-from-your-datain-
mark-zuckerbergs-words/articleshow/63717594.cms
https://www.crunchbase.com/
https://craft.co/
https://www.nasdaq.com/
https://en.wikipedia.org/
https://economictimes.indiatimes.com/
https://www.slideshare.net/
https://www.statista.com/
http://www.adweek.com/
http://www.weforum.org/
http://www.compukol.com/
http://www.nyse.com/
https://in.investing.com/

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 9. ANNEXURE
“A Study on Marketing Strategies towards Social Media Marketing”
(30 responses)
Q1) Full Name
___________

Q2) Gender
o Female
o Male
o Prefer not say

Q3) Age Group

o 18-25
o 21-40
o 40-60
o Above 60

Q4) Employment Status

o Unemployed
o Self-employed
o Employed

Q5) Do you use social media?

o Yes
o No

Q6) Which social media app are you most active on?
 Facebook
 Instagram
 Snapchat
 Twitter
 LinkedIn
 Telegram

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  Whatsapp
 Youtube
 Pinterest
 Gmail
 Other

Q7) How much time do you spend on social media each day?
o 15 mins-30 mins
o 30 mins-1 hr
o 1 hr-2 hrs
o more than 2 hr

Q8) How long have you been on social media ? 

o Less than a month
o 1-6 months
o 7-12 months
o 1-2 years
o More than 2 years

Q9) Do you know how social media sites earn money?

o Yes
o No
o Somewhat

Q10) If given a chance, would you invest in social media?

o Yes
o No
o Maybe

Q11) Do you believe that business will archive better results when it comes to
customer loyalty and profit if Social Media is integrated into marketing ?
o Yes
o No

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Q12) Do you think Social Media helps to grow business opportunities ? 
o Yes
o No
o Maybe

Q13) Which are the top Social Media Advertising platforms ?

 Youtube
 Facebook
 Instagram
 Twitter
 LinkedIn
 Telegram
 Gmail
 Other

Q14) Do you keep up to date with sales and promotions by using Social Media ? 
o Yes
o No

Q15) As social media aims at connecting people worldwide, do you think they
Should work as a non-profit organization?
o Strongly Agree
o Agree
o Neutral
o Disagree
o Strongly disagree

Q16) Which products or services you prefer after watching ads on Social Media?
 Home Appliances
 Fashion products
 Groceries
 Beauty products
 Others

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107