How Social Media Fuels the Economy

Social media boosts the tourism and hospitality sector. Social media networks, including YouTube, Instagram, and Facebook, are full of travel content creators documenting their experiences around the world. The videos, blogs, and photographs they upload encourage people to visit a particular country, site, or hotel. Some countries’ tourism industry peaked because a vlogger showed the world what they offer to tourists. Travel videos on social media can attract thousands of tourists to a destination, fueling economic growth.

Social media promotes economic growth by allowing small businesses access markets. Through social media, small and medium enterprises reach a broad consumer base, increasing customer traffic. In the past, SMEs and startups hardly advertised themselves due to high advertising and promotion costs. However, social media has changed the dynamics by allowing every business to market itself to potential customers with little or no fees. The platforms enable consumers to learn about a brand and its products, deals, and promotions. The low-cost advertising that social media offers to businesses contributes to increased sales, profits, and overall economic growth.

Furthermore, social media boosts the economy by creating jobs. Social networking sites like YouTube, Tiktok, and Instagram pay influencers and creators substantial money based on views or subscribers. Additionally, the platforms allow content creators to advertise their merchandise or third-party products, earning millions. Unlike in the past, people with talent such as singing, scriptwriting, and videography do not need to join Hollywood or the mainstream media to show what they do and make money. For example, Casey Neistat made his name on YouTube making short cinematic videos in New York City. Social media has empowered thousands to employ themselves and earn a decent income.

Social media allows young investors to sell products online without a physical store or a website. Creating a physical or online store requires money and time, blocking many people from actualizing a business idea. For example, leasing a physical store requires several thousand dollars, excluding electricity, insurance, and water charges. Social media eliminates cost barriers by allowing anyone to sell products from home and avoid exorbitant rental property fees. Social media marketplaces have significantly empowered youths who hardly ventured into entrepreneurship due to the cost and complexity of leasing a property. Young people are making millions selling clothes, custom wear, electronics, and arts on social media.

Social media promotes investment by connecting financial institutions with investors and borrowers. Millions of people spend hours on social media each day, presenting an opportunity for banks and Saccos (Savings and Credit Co-operatives) to educate individuals about borrowing and investment. Many people learn how banks and Saccos operate through social media, motivating them to take loans and start businesses. Moreover, investment firms reach potential investors through videos and brochures uploaded on social media. For example, investment companies upload fliers outlining the returns a person can receive by investing in a particular asset or depositing a specified amount. People who saved money without any plans are now finding investment ideas on social media.

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