The Effects of Social Media

Taylor Bell

Mrs. Straub

Economics

3 November, 2014

The Effects of Social Media

For quite some time now, social media has been making its way throughout the world, enhancing communication between individuals. From Facebook to Twitter to public blogs, this type of technology is becoming more and more popular, especially from an economic standpoint. Businesses are doing everything in their power to be a part of the latest social networking sites, as well as have the latest technology, in hopes of promoting and improving their business. All major company owners have realized how wrapped up our society is in social networking, so what better way to draw in customers, than communicate with them virtually?

Most of us high schoolers are all part of the common social networking sites, like Twitter, Facebook, Instagram, and many more. We use them to communicate with our peers, as well as update everyone with where we were last weekend, or what you’re going to have for dinner tonight. Some see these sites as useless and stupid, but business owners see them as an opportunity. Companies are able to produce advertisements, as well as accounts on these sites, so that they can better update the public with things involving their business. With social media being as popular as has been recently, the demand for companies to be apart of this social lifestyle is at an all time high.

Not only is this a fast and easy way for businesses to communicate with potential customers, but it’s also free! According to Jennifer Schiff, who wrote an article about ways that social media is affecting the enterprise, companies are saving “tens of thousands of dollars a year on traditional print, television or radio advertising- or even online banner ads”(Schiff), all because they have chosen to advertise on social media. This is allowing companies to put this extra money elsewhere, and evidently increase the quality of their products. And with this increase in quality, more customers are willing to make purchases, because they are getting what they’re paying for, evidently increasing the revenue and income of these companies.

This is where social media begins to affect the economy as a whole, because of how much control it really has all across the world, and in the United States especially. If you look at the map below, more than 50% of the countries population have at least one account on any of these social media sites.

Businesses are then going to use this to their advantage, by taking that large chunk of the population, and informing them of anything and everything the company wants consumers to know. With this positive effect of social media on businesses, the nations GDP per capita is also increasing. Research was conducted by Richard Florida on the top 50 cities in the United States that use social media the most, and then those cities GDP’s were compared to see the correlation between the two.

This graph ultimately shows a positive trend, with the cities with the highest amount of social media use, having the highest GDP per capita. This all comes together, because the more aware consumers are about businesses and their opportunities, the more profit these businesses will make. Ultimately increasing the GDP of the nation, which then increases the GDP per capita as well.

Clearly social media affects more than what meets the eye, because it is overall helping the health of our economy. With constant advertising and communication with consumers, social media has done nothing but benefit businesses, and increase income. It’s crazy how just a few sites like Twitter or Facebook can have such an influential effect on the incomes of businesses, and the overall position of our economy. So if you aren’t apart of social media, I highly suggest  you sign up, and do your country a favor of staying connected with one of the economies biggest money makers.

Works Cited

Florida, Richard. "Is Social Media Driving the Economy?" The Atlantic. Atlantic Media Company, 27 Oct. 2010. Web. 3 Nov. 2014.

Mullaney, Tim. "Social Media Is Reinventing How Business Is Done."USATODAY.COM. A Gannett Company, 16 May 2012. Web. 3 Nov. 2014.

Schiff, Jennifer. "6 Ways Social Media Affected the Enterprise in 2012." CIO. CXO Media Inc., 13 Dec. 2012. Web. 3 Nov. 2014.

"Promoted Tweets: Is Your Business Ready?" Entrepreneur. Entrepreneur Media, Inc., 28 Apr. 2010. Web. 3 Nov. 2014.

Weingartner, Brian. "The United States of Social Media." Azavea Atlas. 22 Jan. 2014. Web. 3 Nov. 2014.

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