We all pay for brands spending money on marketing, which then pay various platforms allowing these services to be exposed as “free”.
But wouldn’t it be the same if these brands spent less on marketing, and platforms became paid? Is it all a make-believe game? In the end, is it only about brand discoverability?
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Hey, I studied this topic and it was quite interesting to me at that time.
The short answer is : you don’t pay because adds are not meant to generate money. They are supposed to have a negative net return. If you have income from your adds, you are doing something wrong.
So, how does it all work?
Person A has a website that is quite popular, and entirely free. However, he needs money to sustain it, or just wants some money for his work. Yes, he can introduce a fee to users to keep using it, but that means he will lose a big chunk of his users (you saw how that worked out for Twitter/X)
Person B owns a company that wants to run a marketing campaign for their brand. They see that person A wants to make money and offer to pay him to use his webpage as a Billboard. However, he gets paid only if people click on the banner – which is still likely to be quite some money if his site is popular.
You can already see how everyone wins – person A gets his money in exchange for a portion of his website being a billboard, person B company gets their marketing plot, and the users keep using the website for free.
Since person B pays for everything, how do they make a profit from this?
On a countless number of examples and studies, marketing works. It is a tremendous investment, but with great returns.
So, buying through a link costs the company money because they pay for the link. How does this return a profit? By you liking the product and showing it to your friends who will buy it. This is called “organic sales” because the customer (your friends) came to the company by themselves.
So, if we pay for the service, everyone loses.
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