Yubo’s Commerce-Focused Strategy Could Be the Future of Social Media
With 45 million users worldwide, Yubo is not the largest live streaming app on the market. It’s also not the newest. But the company’s founders still think they’ve got an edge in an otherwise crowded space, thanks to a unique business model that replaces in-app advertising with social commerce.
Yubo is part of a new group of ad-free social apps that are doing away with advertising in favor of in-app purchases and subscriptions. That means Yubo doesn’t sell data to advertisers, and consumers can use the app to live-stream content and chat with friends without worrying that they themselves are the product being sold.
While a number of other social apps have in-app purchases and subscriptions as a part of their business model, Yubo’s founders say this is the primary way they plan to monetize. That makes Yubo unique, with a freemium model where users can pay to gain visibility and boost their live streams and followers.
Founded in 2015 by Sacha Lazimi, Arthur Patora and Jérémie Aouate, Yubo is based in France, where the European Union’s GDPR has been in effect for more than three years. Lazimi and Durand say their goal in designing the app was to connect people around the world with category-specific live streams. Unlike other social networks, Yubo doesn’t have likes or followers. The content its users create exists only in live streams.
To a certain degree, Lazimi says the decision to make Yubo ad-free was based on user design. Lazimi wanted his app to be about friendship and meeting new people, and he believed that having ads would impede the natural flow of conversations. But user privacy, and a growing web of international regulations that app publishers must contend with, played a role in the decision to monetize through social commerce rather than advertising.
“We chose to go with a freemium business model because it allowed us to keep user data safe and protected,” Lazimi says. “Yes, most other social platforms rely on ads to monetize, but that doesn’t mean the whole ecosystem needs to as well.”
Big Plays in Commerce
Social platforms have been making big plays in the commerce space in 2021. Shopping on the short-video social media platform TikTok saw a 553% increase during the pandemic thanks to high levels of engagement and more e-commerce integrations. Lazimi doesn’t see TikTok or Instagram as competitors, though, since those apps are “much more influencer- or content-driven.” He says Yubo is, at its core, a friend-discovery app. It provides users with a safe place to mingle digitally, just as they would in real life.
Will Yubo’s freemium business model be sustainable for the long haul? Will consumers who’ve been primed to expect to access every feature for free be willing to pay for a service in exchange for more data privacy?
Lazimi believes there’s enough room in the industry for apps with different business models to coexist. He says users have the option for whether they’d rather spend time on an app that’s monetizing their data or keeping their data protected. The freemium model already exists in several other forms of gaming and media, so there is no reason it can’t be sustainable for social media as well, he argues.
“Every industry needs variety, and social media is no different,” Lazimi says. “Especially for Gen Z and a younger audience, our business model works because you only have to pay if you want to, and you only pay to increase your user experience.”
Lazimi says he wouldn’t be surprised to see even more platforms adopt more diversified monetization strategies, especially as offerings expand to include more interactive options like live streaming, audio, and tipping.
“Platforms are also more under the microscope than ever when it comes to ethical use of data and how they share data with advertisers,” he says. “New players entering the space could see that as an additional hurdle or barrier and opt for other ways of generating revenue.”
Stephanie Miles is a senior editor at Street Fight.