Twitter raised its share price by 25% and eventually priced at $26 per share. As a firm just founded seven years ago, it is pretty surprising that it worth more than $18bn now. However, social media platforms do not make money by the traditional way. For example, Almost all of Twitter’s revenue – about 85% of it – comes from advertising on its site.

I found this blog is interesting because it analysed why these social media platforms can have such a high value. This article also talked about a test project conducted on LinkedIn. The conclusion confirmed that the advertisements pushed to LinkedIn really worked. This explained why more and more companies would like to advertise on social media platforms.

Compared to the traditional advertising methods, this is more efficient and more affordable. That’s why some newly established companies prefer advertise via Facebook. What’s more, because the information of users are published on social media , the companies can customize their advertisements by those valuable information. Because of these advantages of social media advertising, the companies are more willing to pay to the platforms.

“How to Earn Money from Facebook Twitter and Google – Sharing links.” How to Earn Money from Facebook Twitter and Google – Sharing links. 18 Nov. 2013 .

http://www.bbc.co.uk/news/business-24397472
MARJO JOHNE’s Blog on THE GLOBE AND MAIL
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