The Future of Social Media: New Business Models and Synthetic Kinship

The Future of Social Media: New Business Models and Synthetic Kinship

In today's rapidly evolving digital landscape, social media platforms are constantly seeking new ways to engage users and drive growth. The last generation of companies relied heavily on advertising as their primary revenue source. However, startups are now shifting their focus towards alternative monetization models such as subscriptions, in-app payments, and e-commerce. This shift is driven by the recognition that time, rather than advertising revenue, is our most valuable resource. Companies like BeReal, Poparazzi, Mastodon, and Post News are emerging as pioneers in this space, promising a better use of our time.

As we envision the future of social media, it's important to understand the changing dynamics of user behavior. The traditional media landscape has become increasingly polarized, with individuals aligning themselves with news sources that reflect their political affiliations. This has created an echo chamber effect, where people consume information that reinforces their existing beliefs. Subscriptions and in-app payments provide a more sustainable revenue model for social media companies, allowing them to cater to niche audiences and provide tailored content.

One notable example of this shift is TikTok, which has seamlessly integrated e-commerce into its platform. By leveraging its vast user base, TikTok has become a gateway to online shopping, demonstrating the potential for social networks to drive economic activity. This opens up new opportunities for brands and influencers to monetize their presence on social media, blurring the lines between content creation and commerce.

Looking ahead, social media platforms can draw inspiration from immersive games like Roblox, which have successfully created in-world economies. Instead of solely focusing on capturing attention, the next generation of social media giants may prioritize the development of functional, multifaceted economies. By creating virtual marketplaces and opportunities for user-generated content, these platforms can provide users with a more immersive and interactive experience.

While the evolution of social media is exciting, it also raises important questions about the nature of human connection. We are inherently social beings, seeking kinship and a sense of belonging. Currently, this need can only be fulfilled through interactions with other humans. However, advancements in artificial intelligence (AI) may soon enable us to form deep connections with synthetic friends and loved ones. Although this may seem dystopian, it is a plausible future where AI plays the role of other characters in our private Truman Show.

To overcome the challenge of building social networks from scratch, future platforms may generate billions of synthetic personalities to interact with human participants. This approach would create the illusion of an active network, blurring the lines between human and artificial individuals. While this concept is thought-provoking, it also raises ethical considerations and the need to establish boundaries between reality and simulation.

As we navigate this rapidly changing landscape, it's crucial for businesses to adapt and embrace growth strategies that align with evolving user behavior. Building a dedicated growth team can significantly accelerate the overall growth trajectory of a company. Facebook's growth team, for example, played a pivotal role in its rapid expansion from 50 million to 2 billion monthly active users.

However, it's important to note that a growth team should only be formed once the company has addressed any underlying issues with product-market fit and retention. Benchmarking long-term retention against industry standards is crucial to ensure sustainable growth. Once a company has proven sustainable retention, it can focus on building a dedicated team to further improve retention while acquiring and activating new users.

When establishing a growth team, hiring individuals with prior growth experience is essential. Former founders often possess the necessary skills and mindset to drive growth effectively. Setting realistic and motivating goals is also critical. The most successful growth teams set goals that are challenging yet attainable, striking a balance between "sandbagging" and setting unrealistic expectations.

Identifying the most effective growth channels requires a deep understanding of user behavior. Referrals often emerge as a top channel within the first year of a company's growth. Running experiments and continuously optimizing growth strategies are key to long-term success. Companies at scale typically run one experiment per growth engineer per week, highlighting the importance of a robust experiment dashboard.

In conclusion, the future of social media lies in the convergence of new business models and the potential for synthetic kinship. As companies embrace alternative monetization strategies and create immersive economies, they can provide users with a more valuable and engaging experience. However, it's crucial to navigate this evolution ethically and establish boundaries to maintain a healthy balance between the real and the virtual. By incorporating actionable advice such as building a dedicated growth team and setting realistic goals, businesses can position themselves for success in this rapidly evolving landscape.