The Economics of “Going Viral”: Attention as a Scarce Resource

Do you want to be famous?  What would you do to become famous?  Today, many young people aspire to be influencers and/or content creators who rise to social media fame by making multimedia posts.  Typically, these posts are brief videos on popular apps like TikTok and Instagram Reels.  Some third-party tools exist to allow budding influencers to post to multiple sites simultaneously, reaching thousands of viewers on each platform quickly.  While most of these posts from fame-seeking young women and men may seem frivolous, a handful have been quite successful.  

The Economics of Going Famous: Monetize Your Profile

You can get paid if you can attract attention, which is considered a scarce resource.  The human attention span is limited, meaning there are opportunity costs for everything we pay attention to.  Every hour we spend scrolling TikTok is an hour not spent watching Netflix, and every hour we spend playing online video games is an hour not spent figuring out what to order on Door Dash.  Thus, an attention economy exists to attract attention to things.  Where consumers’ attention goes, sellers reason, revenue follows.

This leads to the monetization of social media, where digital ads can be placed to take advantage of viewers’ attention.  Companies can spend big bucks to put their ads on social media sites.  However, some want to get more guaranteed attention directly, and so can reach out to popular influencers and content creators.  This is especially true when a company produces a good or service that fits directly with a content creator’s persona or activities.  For example, a parkour enthusiast with tens of thousands of online followers would likely be approached by an athletic apparel company about featuring the company’s products.  The influencer can get paid to allow online ads on his or her profile, promote products directly in videos and posts, or simply be seen using the products.

Algorithms and Engagement

Social media today is mostly run by algorithms, with viewers being continually shown more content that is similar to content they have interacted with in the past.  If influencers want more exposure to viewers, they must generate the type of content that has historically gotten lots of attention.  This can mean lots of budding influencers creating very similar content, reducing the overall value due to an increase in supply.  

The focus on creating content that is deemed ripe for engagement can result in a preference for quantity over quality, with content creators and influencers hoping to capitalize on viewing trends quickly.  This goal of optimizing for virality, with influencers hoping to “go viral” by producing a post or video that amasses thousands of views in a very short time, often results in a homogenization of Internet content.  In order to be efficient, content creators and influencers do not want to risk trying something new and potentially get fewer views than expected.  They trust the algorithm and try to deliver more of what people have been viewing.

Diminishing Returns of Viral Ad Campaigns

When a popular new online trend emerges, influencers and content creators quickly get on board to take advantage of algorithms showing those similar videos to millions of social media users.  This will inevitably lead to diminishing returns as viewers see many similar videos in a short time span, reducing the amount of utility (entertainment satisfaction) that each new one provides.  When done for advertising purposes, this means that the market is quickly saturated (filled to capacity) with ads and the good or service is widely known to consumers.  Thus, producers can end the online ad campaign quickly, reducing the amount of money available to spend on collaborations with influencers and content creators.

Economic Benefits of “Going Viral” and Attracting Attention

Despite the rarity of going viral, many pursue it because it can lead to tremendous financial gains.  It can help entrepreneurs and small businesses gain a solid foothold in a market by establishing immediate popularity.  There are plenty of individual examples of an online or social media campaign that went viral helped a company boost its revenue, potentially staving off bankruptcy.

The marginal cost of attempting to go viral is usually very low, with smartphone containing all the technology needed to create and post an entertaining video, meaning content creators can try constantly.  However, this ease of production means a lack of barriers to entry and drives up supply, reducing the likelihood of big payoffs for going viral.  Due to the lack of barriers to entry and content creators’ incentive to create content favored by algorithms, some would argue that the market for creating viral online content is almost perfectly competitive.

Social Costs of Everyone Trying to Go Viral

Lack of Diverse and Educational Content Can Harm Viewers

Unfortunately, the pursuit of online fame and fortune by creating viral content creates social costs that affect third parties.  Critics argue that the relentless focus on creating algorithm-pleasing content deprives viewers of more diverse, higher-quality content.  This includes educational and informative content, which may be disregarded by viewers who want video clips that are more sensational or enticing.  Algorithms may also be biased against content created by or geared toward members of non-dominant groups, such as racial, ethnic, or religious minorities.  This can lead to cultural erasure through the homogenization of online media.

Mental Health Struggles Harm Users and Third Parties

Attempting to create viral content can increase the likelihood of social media addiction.  As users spend more time on social media to attempt to pin down the algorithm and maximize the popularity of their content, they come to associate viewer interactions with their content with happiness.  Eventually, this becomes an addiction, with content creators spending increasing amounts of time online to seek validation from viewers.  Critics of unregulated social media use by the public argue that Internet and social media addiction harm young people and their families by making them struggle excessively to cope with real world activities.

Mental health proponents also argue that rampant social media use increases the incidence of depression in young people.  Depression can occur when these young users begin comparing their real lives with the highly curated and filtered lives of content creators and influencers, developing the false sense that their own lives are insufficient.  Viral content can amplify this problem, with young social media users feeling insecure due to the much lower exposure of their own content.  By seeing “regular people” get thousands of views on their videos, many young social media users may feel the need to increase their own efforts to “go viral”, resulting in mental health woes and ignoring real-world tasks.