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Internet users spend around two hours a day on social media. That's enough time for brands to show them dozens of marketing messages, including paid ads. The volume of these messages is so high that Facebook is essentially one of the largest advertising networks out there.
However, some organizations don't just market through social media. They use social media to create new, alternative business models. Some of these models, like the Instagram monetized page, are well known. others are not published, but are highly profitable.
Related: 3 Common Mistakes Companies Make With Their Social Ad Strategy
So what are some of these alternative business models that are booming right now? We'll cover the traditional status quo, emerging trends in online business, and some specific examples of new ways to make money online.
The traditional digital business model
In the traditional digital business model, your website is the heart of your online business. This is where you display your products, market them to potential customers and take orders.
This is the model used by digital service providers, online shops and brick-and-mortar businesses. You create a website and drive traffic to it, generate leads and sales. That's how things have worked for over 20 years.
The biggest change to this traditional model is the advent of mobile apps. Mobile devices now account for over 50% of all web traffic, and 78% of mobile users prefer apps to websites. As a result, more and more companies are using branded apps.
However, apps are usually an alternative way of presenting website content. They still fit into the traditional digital business model.
This is where social media comes in, helping entrepreneurs market, monetize, and scale businesses in entirely new ways. Here is how.
The rise of social business models
In 2012, Google's advertising revenue was around 1,000% of Facebook's. Google was the platform for discovering new content, buying products, and just about anything else.
Things are different now. After buying Instagram and growing Facebook Video, Facebook has 1.79 billion daily users compared to 3.5 billion daily searches on Google. Social traffic is on par with search engine traffic – especially when you consider other major platforms like Snapchat, LinkedIn, Pinterest, etc.
This broad user base means businesses can forego search engine traffic or a website. They can do everything they need to do online – traffic, market, deals – entirely within social media platforms.
This is the core of the new, alternative business models that we will introduce to you below. They use social media for some or all of their online operations, creating new niches in the process.
Alternative business models with social media
1. Influencer e-commerce
In the past, brands have sponsored Instagram and YouTube influencers. In this older business model, content creators receive a fixed sum for mentioning or displaying a product in their photos, recordings, and videos.
More recently, this has been superseded by a different model in which influencers monetize their own content directly.
For example, many producers on YouTube place affiliate links in the descriptions below their content. This way, they can make their own money directly by promoting sales to partners like Amazon.
Related: 4 Top Benefits of a Successful Kickstarter Campaign
Others go a step further and create their own product lists on sites like Amazon. Those who hire optimization professionals frequently, like Danny Carlson, whose Amazon Listing Optimization Agency (Kenji ROI) makes over $ 70,000 a month.
According to Danny, "(for online sales) the highest ROI investment you can make is in your Amazon listing … (your) photos, copies, and videos." Having direct control over these items is one of the most important Main Reasons Social Content Makers Avoid Affiliate Marketing
Regardless of the monetization strategy, creating social content and using it to generate revenue is a booming alternative business model. Thousands of developers are currently applying it to their business – and many more are sure to follow.
2. Self-published books and audio books
Self-publishing on sites like Amazon has been a little-known, highly profitable business niche for several years. Writers and entrepreneurs were already using this model in 2015 to generate six- and seven-figure incomes.
However, a newer version of this model is currently being released. Two trends are shaping it: booming audiobook sales and the rise of social media. The essence of the model is to self-publish audio books in addition to e-books and to market both via social media.
As a result of this trend, self-publishing professionals and educators are doing two things. First, Kindle publisher veterans revolve around social media and teaching.
Second, a new class of self-publishers is emerging. One example is the Mikkelsen Twins, who earn over $ 500,000 a month for self-publishing on Audible. The two owe much of their success to social media: "The reason we got so much attention is because we shared everything we knew for free on our YouTube videos."
Now Rasmus and Christian Mikkelsen are starting PublishingLife.com to help others thrive with the same business model.
Some entrepreneurs take a different route and post free, non-monetized content on their social channels. You will make a profit with the following model.
3. Freemium social channels
Traditionally, social media channels are monetized through merchandise, sponsorship offers, and e-commerce sales. It has always been desirable to monetize content directly – i. H. Getting people to pay for your videos, pictures, and recordings – but out of reach.
That is changing now. With platforms like Patreon, developers can offer simple, convenient paid subscription options. Users who sign up are usually rewarded with exclusive early access content, fun freebies, and a host of other perks.
4. Decentralized companies
Crypto Tech has brought us a lot of valuable applications, from Bitcoin to decentralized blockchains for finance and logistics. Along with social media, entrepreneurs can now create decentralized crypto businesses.
One example is Fundabit: a decentralized crowdfunding platform that allows users to invest crypto in exciting new projects. Another example is the Market Peak project, where users can earn passive income by leveraging online communities.
Related: 5 Ways to Help Your Small Business Survive During the Pandemic
Market Peak founder Sergej Heck first discovered the power of social media by building and scaling large sales teams using social networks. Now he's using the same strategies to serve his growing user base. He explains:
"Your customers have one thing in common: they're all looking for a solution. (You can) have a group or forum where people can share their best tips … so they can network and help each other."
This is the latest alternative business model on our list. Although it has had less time to grow compared to the previous three, it appears to have a bright future.