Social Media

Overview of the ‘Social Media’ System

• What individuals choose and like are socially constructed. Human behaviors are under constant social influence instead of a result of rational reasoning. ¹ With traditional media (such as the commercials on mass media), it is unlikely for marketers to know the likelihood of a product being sold to an audience. With social media and the information to predict consumer choice, it becomes an easy task.

• The data of social connections can predict consumer choice because social networks are the primary source of information for human minds. In fact, networks not only preserve important information but also project the social identity of individuals. ² Users on virtual social networks self-identify themselves in the social circles and communities, which continuously and automatically generates market segmentation and precise targeting data at zero cost for the owners of social media sites.

• User social engagement comes with a positive feedback loop of network effects, through which user experience increases as more other users are joining the network. ³ The primary goal for social media sites is to grow and retain the user base through optimizing the user interface. A disproportionally larger user base allows social media sites to continuously convert zero-cost user data into profitable ad recommendations.