Social Media Marketing and Game Theory
https://link.springer.com/content/pdf/10.1007/978-3-642-13299-5.pdf
Considering the prominence social media has developed within the scope of everyday life, platforms such as Instagram and Facebook have become a coalescence of networks—friends, colleagues, family, romantic relationships, etc. As to be expected in a capitalist market, social media has become more than just a tool to connect with individuals, but a platform to make sales: a catalyst for the birth of social media marketing and the rebirth of advertising as a whole.
Now, sales are driven by influencer funnels, collaboration, Instagram sprints, etc. Considering how social media is made up of networks, then, game theory as it relates to behavior is inseparable from social media marketing, which begs the question and investigation of how they interact.
Consumers and marketers act as two different “players” on the same platform. As with other models of game theory, they have varying strategies and payoffs. What differentiates social media marketing from any other form of media is that consumers have equal, arguably even stronger, ability to affect the payoff of marketers through retaliation: counter-signaling, disputing the messaging, being conveyed about the brand, “cancel-culture.” Thus, in social media specifically, the marketers must act more strategically than they would otherwise for the sake of cooperation: they need to work in tandem with consumers in social media in order for both parties to obtain successful payoffs (increased sales and consumer satisfaction, respectively).
The push and pull of cooperation can manifest in a multitude of ways according to the multidimensional functionality of the internet. For example, it could appear as social media engagement, algorithmic ranking, paid search and SEO, and more.
The intricacies within the intersection of social media and game theory are complex, as they exacerbate the forces of capitalism through the cannon of vast, interconnected webs of users. In order to fully take advantage of social media. In an economy in which thousands of startups and businesses go bankrupt every year due to either lack of awareness or bad press, it is crucial to be able to understand the complexities of game theory on social media.