Social Media Today: Monetization, AI, and Gen Z Challenges

Photo by Google DeepMind on Unsplash

Social Media wasn’t supposed to go this way.

As Facebook turns 20, the social landscape at large is continuing to mature away from the ideals of connection and personal discovery toward full tilt algorithmic optimization. While the platforms’ focus du jour is squarely on expanding advertising opportunities and integrating AI, there are some interesting forces pushing things in yet another new direction. How should brands think about the social landscape today? Where should they start to detangle the competing incentives between users and apps? 

First, it’s important to check in on where the platforms stand today from a user base and engagement standpoint. Some have established themselves clearly as being here to stay (Facebook, Instagram) others are continuing to grow and emerge (TikTok, Reddit, Pinterest, Threads, now Bluesky) and, elsewhere, once prominent channels are burning bridges and equity (X). From a brand perspective it’s important to know which channels are in favor and attracting more audiences, opportunities and resources to prioritize marketing budget allocation. However, looking at the broader picture of how these platforms are investing gives a sense of where advertising and content opportunities are going to sit. 

As mentioned previously, there are really two themes driving innovation in the social space - accelerated monetization and integrated AI. 

In terms of monetization, we are seeing a variety of tactics:

• More aggressive ad offerings such as Instagram and YouTube’s unskippable ‘ad breaks’

• Opening up of new ad inventory placements like the comments section on Reddit and TikTok’s search ads

• Creating net new experiences to attract audiences like LinkedIn’s foray into Gaming or Twitch’s recent discovery feed (both of which are sure to be monetized shortly)

On the AI-front, platforms have invested significantly in integrating their AI capabilities and leveraging them toward new marketing experiences for brands. Meta and TikTok have both launched generative-AI powered tool suites for advertisers to optimize their creative assets. Additionally, these same platforms have also both launched AI powered Avatars which brands can leverage to create life-like influencer style content. Things are getting interesting (read: strange), fast. 

Beyond keeping up with the algorithms, there are other factors emerging that brands need to watch. Primarily, the generational attitudes driving changes in user behavior on these platforms and shaping what the next wave of social media might look like. 

We have already seen Millennials and Gen Z both already shift to less public facing social media use such as sharing to DMs, group chats, and 1:1 private chats vs. public comments and posts to public feeds. And now, we’re openly seeing Gen Z long for a different landscape altogether. There are signals coming from this group that backlash to algorithmic monetized spaces is underway. They have a desire for simpler platforms, a distaste for legacy apps and their ‘copycat’ feature implementation and are supporting traction of more intimate experiences and communities like Discord or Nospace. 

Despite pushback on platform behavior from younger generations, we still know that being ‘online’ helps them feel connected and discover community. Although there are positives for brands to takeaways from this there are growing concerns around the time spent on social media and the healthiness of today’s status quo for future generations. The U.S. Surgeon General has gone so far as to suggest regulating social media usage for young users. 

So, back to the core question here - where does all this leave brands today? 

• What’s Old Is New Again. Keep an eye on old or less exciting platforms that are starting to see significant user growth i.e. Threads, Pinterest, Reddit and shift investment accordingly. 

• Test into New Ad Products. It’s worth trialing the new optimized products the big platforms have rolled out, but don’t bet the farm just yet. Early reports have exposed growing pains. 

• Watch Gen Z. It’s clear the younger cohort isn’t satisfied with where things stand on social media today. While things won’t change overnight, new networks could start to steal some attention back from the established leaders.