Social media consists of a myriad of means in which the interactions among people using web-based tools and platforms creates online virtual communities centered on user input and the sharing of information.
Through social media, businesses can simultaneously draw in new consumers whilst making existing customers more familiar with the brand.
For example, through the use of the micro-blogging site Twitter; brands can promote their products with a simple "tweet", and any regular Twitter user could potentially stumble across their products and services via their newsfeed, whilst existing customers may become extra accustomed to the brand after seeing positive responses; following the current consumer's fashions.
[8] Social media can directly lead to an increase in sales and brand awareness, as demonstrated with multiple campaigns in the past.
Activity on social networking platforms such as Facebook as an example can lead to increased traffic that the company's website receives via these referrals.
[12] Activity on social media almost acts as a signal to search engines of a company's popularity and credibility, with all of this ultimately leads to more sales and increased brand awareness.
[13] Facebook's $19 billion acquisition of WhatsApp, the popular mobile messaging app, has extreme significance in terms of social media investments.
[15] Micro-blogging powerhouse Twitter has recently invested $10 million in the "Laboratory of Social Machines" initiative at the Massachusetts Institute of Technology.
The major open source, community based social network and news site Reddit, famously labelled as the "front page of the internet", has secured $50 million of investments from multiple sources; from global venture capital firms such as Andreessen Horrowitz to an array of celebrities such as the renowned rapper Snoop Dogg.