Social media is mainly offered free of charge. Facebook, Twitter, YouTube, LinkedIn, and many other applications are free to users. Hence, it is interesting to study how free-to-use social media achieves monetization. Previously, we have discussed the possibility of monetizing via social advertising. We will not reiterate this here but focus on an alternative approach to monetization of social media users: premium service or content.
This is a preview of subscription content, access via your institution.
Tax calculation will be finalised at checkout
Purchases are for personal use onlyLearn about institutional subscriptions
It is worth mentioning that many of these studies focused on decorative, virtual items (e.g., digital accessories, furniture, and clothes for digital avatars), and social virtual communities such as Cyworld (Kim et al., 2011), Second Life (Animesh et al., 2011; Guo & Barnes, 2011), Habbo (Kim et al., 2012; Mäntymäki & Salo, 2013, 2015), and iPart (Shang et al., 2012), which are not commonplace social media platforms, e.g., Facebook, YouTube, Twitter, and WeChat.
This feature can be seen at Tinder’s official site: https://www.help.tinder.com/hc/en-us/articles/360046358932-Message-Before-Match-
Animesh, A., Pinsonneault, A., Yang, S. B., & Oh, W. (2011). An odyssey into virtual worlds: Exploring the impacts of technological and spatial environments on intention to purchase virtual products. MIS Quarterly, 35(3), 789–810.
Bawa, K., & Shoemaker, R. (2004). The effects of free sample promotions on incremental brand sales. Marketing Science, 23(3), 345–363.
Botha, E., & Mills, A. J. (2012). Managing the new media: Tools for brand management in social media. In A. Close (Ed.), Online consumer behavior: Theory and research in social media, advertising and E-tail (pp. 83–100). Taylor and Francis.
Chan, C., & Segal, A. (2019). Making a living off ‘likes’: The new influencer paradigm. Retrieved from https://a16z.com/2019/12/19/making-a-living-off-likes/
Constine, J. (2018). Facebook builds Patreon, Niche clones to lure creators with cash. Retrieved from https://techcrunch.com/2018/03/19/facebook-creator-monetization/
Cook, J. (2015). Tinder’s paid subscription service could ruin everything that made it great. Retrieved from https://venturebeat.com/2015/02/08/tinders-paid-subscription-service-could-ruin-everything-that-made-it-great/
Dutta, A. (2020). YouTube business model|How does YouTube make money? Retrieved from https://www.feedough.com/youtube-business-model-how-does-youtube-make-money/
Florentine, S., & Kapko, M. (2019). Why LinkedIn Premium is worth the money. Retrieved from https://www.cio.com/article/2877153/why-linkedin-premium-is-worth-the-money.html
Guo, Y., & Barnes, S. (2011). Purchase behavior in virtual worlds: An empirical investigation in Second Life. Information and Management, 48(7), 303–312.
Ha, A. (2019). Facebook will start taking a cut of fan subscriptions in 2020. Retrieved from https://techcrunch.com/2019/07/09/facebook-subscription-revenue-share/
Hamari, J., Hanner, N., & Koivisto, J. (2017). Service quality explains why people use freemium services but not if they go premium. International Journal of Information Management, 37(1), 1449–1459.
Huya Inc. (2020). 2019 annual report. Retrieved from https://www.file:///C:/Users/K/Desktop/HUYA%202019%20Annual%20Report.pdf
Incitez China. (2014). Weibo launched paid content and buy-me-a-coffee features for premium publishers. Retrieved from https://www.chinainternetwatch.com/8090/weibo-launched-paid-content-buy-me-a-coffee-features-for-premium-publishers/
Kim, H. W., Chan, H. C., & Kankanhalli, A. (2012). What motivates people to purchase digital items on virtual community websites? The desire for online self-presentation. Information Systems Research, 23(4), 1232–1245.
Kim, H. W., Gupta, S., & Koh, J. (2011). Investigating the intention to purchase digital items in social networking communities: A customer value perspective. Information and Management, 48(6), 228–234.
Lee, T. (2020). Twitter could be considering adopting a subscription model. Retrieved from https://www.ubergizmo.com/2020/07/twitter-could-adopt-subscriptions/
Lee, U., Kim, J., Yi, E., Sung, J., & Gerla, M. (2013). Analyzing crowd workers in mobile pay-for-answer Q&A. In Proceedings of the SIGCHI Conference on Human Factors in Computing Systems, pp. 533–542.
Lepak, D. P., Smith, K. G., & Taylor, M. S. (2007). Value creation and value capture: A multilevel perspective. Academy of Management Review, 32(1), 180–194.
Liu, C. Z., Au, Y. A., & Choi, H. S. (2014). Effects of freemium strategy in the mobile app market: An empirical study of google play. Journal of Management Information Systems, 31(3), 326–354.
Mann, H. (2020). How much is YouTube worth? $170bn in 2020. Retrieved from https://mannhowie.com/youtube-valuation
Mäntymäki, M., & Islam, N. (2015). Gratifications from using freemium music streaming services: Differences between basic and premium users. In Proceedings of the ICIS.
Mäntymäki, M., & Salo, J. (2013). Purchasing behavior in social virtual worlds: An examination of Habbo Hotel. International Journal of Information Management, 33(2), 282–290.
Mäntymäki, M., & Salo, J. (2015). Why do teens spend real money in virtual worlds? A consumption values and developmental psychology perspective on virtual consumption. International Journal of Information Management, 35(1), 124–134.
Microsoft. (2020). Annual report 2020. Retrieved from https://www.microsoft.com/investor/reports/ar20/index.html
Shang, R. A., Chen, Y. C., & Huang, S. C. (2012). A private versus a public space: Anonymity and buying decorative symbolic goods for avatars in a virtual world. Computers in Human Behavior, 28(6), 2227–2235.
Sina Tech. (2018). Weibo empowered content writers to earn 26.8 billion yuan the content ecosystem is more active. Retrieved from https://tech.sina.com.cn/i/2018-12-21/doc-ihmutuee1410472.shtml
SwipeHelper. (2020). Tinder platinum—The new subscription tier above tinder gold. Release date, price, and features as they unveil. Retrieved from https://www.swipehelper.com/2020/07/17/tinder-platinum-new-subscription-tier-above-tinder-gold-rumored-release-date-price-features/
Tong, Q., & Jia, D. (2020). WeChat tests Pay-to-read feature for public blogging accounts. Retrieved from https://www.caixinglobal.com/2020-01-16/wechat-tests-pay-to-read-feature-for-public-blogging-accounts-101504591.html
Vicente, V. (2020). What is YouTube premium, and is it worth it? Retrieved from https://www.howtogeek.com/659597/what-is-youtube-premium-and-is-it-worth-it/
Wagner, K. (2019). Mark Zuckerberg explains why an ad-free Facebook isn’t as simple as it sounds. Retrieved from https://www.vox.com/2019/2/20/18233640/mark-zuckerberg-explains-ad-free-facebook
Wagner, T. M., Benlian, A., & Hess, T. (2014). Converting freemium customers from free to premium—The role of the perceived premium fit in the case of music as a service. Electronic Markets, 24(4), 259–268.
Xu, J., & Duan, Y. (2018). Subscription price and advertising space decisions for online content firms with reference effect. Electronic Commerce Research and Applications, 30, 8–24. https://doi.org/10.1016/j.elerap.2018.05.007
Yadavalli, S., Kapoor, P., Bruun-Jensen, J., & Freilich, R. (n.d.). Business model coherence. Retrieved from https://www2.deloitte.com/content/dam/Deloitte/us/Documents/consumer-business/us-cb-m-and-a-match-making-consumer-products.pdf
Zhang, W. (2020). WeChat is letting bloggers add paywalls. Will the experiment work? Retrieved from https://www.sixthtone.com/news/1005086/wechat-is-letting-bloggers-add-paywalls.-will-the-experiment-work%3F
Zhao, Y., Zhao, Y., Yuan, X., & Zhou, R. (2018). How knowledge contributor characteristics and reputation affect user payment decision in paid Q&A? An empirical analysis from the perspective of trust theory. Electronic Commerce Research and Applications, 31, 1–11.
© 2022 The Author(s), under exclusive license to Springer Nature Switzerland AG
About this chapter
Cite this chapter
Martínez-López, F.J., Li, Y., Young, S.M. (2022). How Social Media Can Monetize by Offering Premium Service or Content. In: Social Media Monetization. Future of Business and Finance. Springer, Cham. https://doi.org/10.1007/978-3-031-14575-9_5
Publisher Name: Springer, Cham
Print ISBN: 978-3-031-14574-2
Online ISBN: 978-3-031-14575-9