The Impact of Social Media on Business
📚What You Will Learn
- How social media drives customer acquisition and revenue for modern businesses
- Why social commerce and influencers are critical to product discovery and sales
- How AI and data are changing the way brands create and manage social content
- Key risks and best practices when using social media for business growth
📝Summary
💡Key Takeaways
- Over 5 billion people use social media, making it one of the largest channels for reaching customers worldwide.
- More than 80% of marketers say social media is now their primary customer acquisition channel, often delivering higher ROI than traditional marketing.
- Social commerce and influencer marketing turn social feeds directly into shopping and discovery channels, accelerating purchase decisions.
- AI is transforming social media marketing by boosting efficiency, content output, and engagement rates.
- Customers expect fast, human responses on social platforms, so poor social care can damage brand perception as quickly as great service can build loyalty.
Social media has shifted from a “nice to have” to a primary driver of business results. Over 5 billion people worldwide are active on social platforms, giving brands access to nearly two‑thirds of the global population. This scale makes social the default place to build awareness, test messages, and stay visible.
For many companies, social is no longer just about visibility—it’s about revenue. Around 83% of marketers say social media is now their main customer acquisition channel, and brands that invest more than 20% of their marketing budget into social report significantly higher ROI than those that spend less. As a result, social budgets and strategic focus continue to climb.
Social media feeds have effectively become storefronts. Social commerce revenues are forecast to reach around $1 trillion globally in the next few years, as people increasingly discover and buy products without ever leaving their favorite apps. Features like shoppable posts, live shopping, and in‑app checkouts shorten the path from interest to purchase.
Influencer marketing magnifies this effect. The influencer market is expected to exceed $30 billion, with nearly half of consumers making monthly purchases driven by creator content. Influencers provide social proof and authenticity that traditional ads often lack, helping brands break through ad fatigue and reach niche communities at scale.
As competition intensifies, brands rely on data and AI to stay ahead. AI adoption in marketing is widespread, with most marketers reporting higher efficiency and faster content delivery when using AI tools. In social media specifically, businesses using AI for content generation and optimization see notable lifts in engagement.
AI now supports everything from drafting posts and captions to predicting the best time to publish, optimizing ad targeting, and analyzing sentiment. Social listening tools powered by AI help brands detect emerging trends and potential crises earlier, and companies that invest in these capabilities report faster revenue growth and better crisis management.
With almost all businesses competing for attention on social platforms, standing out is harder than simply posting consistently. Users are overwhelmed by content and increasingly annoyed by generic or intrusive ads, which forces brands to focus on relevance, creativity, and value in every interaction.
Customer expectations are also higher. A large majority of consumers expect brands to respond on social within about a day, and slow or tone‑deaf replies can quickly trigger public backlash. At the same time, a single viral complaint can damage reputation, making proactive monitoring and thoughtful community management essential parts of doing business on social today.
To harness social media effectively, businesses need a clear strategy rather than just activity. That means defining target audiences, choosing platforms that match their goals (for example, TikTok and Instagram for visual and short‑form content, LinkedIn for B2B), and aligning content with customer needs and culture.
Successful brands combine organic content, paid campaigns, creator partnerships, and social listening into one integrated approach. They treat social channels as two‑way communication tools—places to provide support, gather feedback, test ideas, and build community. Used this way, social media becomes not just a marketing channel, but a core driver of product improvement, brand trust, and long‑term business growth.
⚠️Things to Note
- Most small businesses are on social media, so the challenge is differentiation, not just presence.
- Short‑form video platforms like TikTok offer some of the highest engagement rates, especially for brand discovery.
- Social media ad spend is surging, which raises competition and pushes brands to focus on creative, targeted campaigns.
- Real‑time social listening helps companies detect crises early and adapt products and messaging based on live customer insights.