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					 You have friend on facebook but is facebook
                              really a friend?


Have you ever been annoyed by the eruption of those so-called pop up widget of ad
while you was quitely surfing through the web?
Have you ever been suprise by an ad sound when you was just opening a new web
page?
Have you ever received on your own mobile phone ads about things ypu had never
subscribed in?




Press review – facebook a friend ?                                            1/8

Loïc Kenmogne, Narjiss El Abbassi Chkara
                                                     Facebook is this world wide well
                                                     known social network enabling
                                                     more than 50 millions of users to
                                                     feed its own web pages, with
                                                     information on their profile,
                                                     connections with their friends, and
                                                     large range of applications that they
                                                     can create or use.

                                                     The advantage of facebook was
                                                     clearly to give to the user this
                                                     capacity to provide content by
                                                     implementing himself new
                                                     applications. This is a real WEB 2.0
                                                     approach.
                                                     Even Myspace is the most used
                                                     today with over 200 millions of
                                                     users, facebook is definely the most
                                                     innovating.




The advertising is facing a new evolution. This
was non avoidable with all the new media of
communication and their development. Mobile
phone, Internet Network, Mobile phone with
Internet browser integrated... as much reasons
that push the professional of advertising to think
about how to reach more efficiently their targets.




   The trend today, is to the targeting. To process on an advertising acurately adapted
   to the customer. Retail e-commerce Website are already proposing new devices to
   their customer according to their last purchases, but never an action like the one
   initiated by Facebook have ever existed.

   Press review – facebook a friend ?                                                  2/8

   Loïc Kenmogne, Narjiss El Abbassi Chkara
                                                         A little bit of history
Facebook was launched in February 2004 by Harvard undergrad students as an
alternative to the traditional student directory. Its popularity quickly spread to other
colleges in the US by word of mouth, and the site. Facebook is already generating
significant revenue, so despite all the valuation and web traffic metric hype, it has
also established a very real business.


                                                           Key success factors
Designed by college students, for college students

Facebook had its initial success with college students by providing an information
service that was not available offline – an interactive student directory containing
each student’s class schedule and social network. Before Facebook added the feature
sets it has today, it was simply a more complete student directory. Facebook did not
create a community where one never existed before; rather they provided an
important information and communication service to a pre-existing offline
community.

Facebook organized students by class schedule for the first time, making it possible
to learn more about that classmate1 you might have a crush on. Initial Facebook
usage was indeed driven by dating type activity – checking people out, learning
more about crushes, light stalking type of activity, etc.

The larger picture here is that Facebook created a high utility online service for
enabling pre-existing social behaviors within an offline community.




Press review – facebook a friend ?                                                   3/8

Loïc Kenmogne, Narjiss El Abbassi Chkara
Privacy

Facebook made important product decisions that ensured harmony and trust
between the offline community and the online service created. Facebook originally
limited membership to those users who could verify they had a “.edu” e-mail
address for the college they attend. Facebook also placed limits on the ability to
search or browse users to the college that the user attends. These measures aim to
make users feel that the site is exclusive and limited to members in their offline
community (colleges and universities).

Facebook has opened its doors to users outside the .edu networks since. To
accomplish this, they have created “networks”. High schools, employers and
geographic areas are, essentially, what colleges were to the original Facebook. When
you join one of these “networks,” you can only view others in the self-designated
network. Additionally, Facebook has implemented a number of privacy controls that
allow users to control exactly who gets to see the information they provide.

Built strong brand recognition amongst user base and advertisers

The key to an online advertising business targeting branded advertisers is having a
strong brand that advertisers want to be associated with. A perceived hot brand is
what drives premium CPM rates. Two sites having similar demographics and user
usage patterns may have drastically different CPM rates based solely on the
perceived brand recognition and image factor. While some people I spoke with
disagreed, I believe that Facebook did a masterful PR job - highlighting the impact
that Facebook has made on the lives of college students and their online media
consumption in nearly every story written. How often do you hear that 90% of
Facebook users login to the site once per week? Clearly the PR coverage came as a
result of the tremendous viral growth, but capitalizing on that PR to help build brand
was a key success factor.




Press review – facebook a friend ?                                                 4/8

Loïc Kenmogne, Narjiss El Abbassi Chkara
                                                                Prior Analysis
Many people point to the fact that Facebook is considerably smaller than MySpace
from a site traffic perspective and hence should have a lower valuation than the
~$500M that MySpace was purchased for. This type of comparison based on unique
visitors and page views is clearly flawed because not all page views are created
equal. There are several good reasons why Facebook’s page views are more valuable
than those of MySpace:

1) Facebook’s core user base (college students) is more desirable than MySpace’s core
user base (teenagers). Because college students have more disposable income and are
more likely to have credit cards than teenagers, they are more desirable from an
advertiser perspective.
2) Facebook represents a more compelling local advertising opportunity than
MySpace because Facebook can guarantee deep penetration of college campuses,
whereas MySpace cannot show the same types of local market usage patterns.
3) Facebook is viewed as a safer option than MySpace for branded advertisers, as
Facebook has a less racy image than MySpace. In a market where advertisers are still
hesitant regarding user generated content sites, Facebook has done a better job of
brand positioning.

Facebook reinforces is the importance of brand and PR buzz to advertising rates. The
amount branded advertisers are willing to pay for online advertising is hugely
subjective – it’s still more art than science.

But the last move of facebook is a kind of lesson of how you can risk all your
accumulating credibility by moving through one of the best point of the strategy.




Press review – facebook a friend ?                                                  5/8

Loïc Kenmogne, Narjiss El Abbassi Chkara
Major Event :
Facebook unveils a new business model

On this last quarter of 2007, Facebook announced that they
were planning to sell to advertisers their users datas for a
targeted advertising. A new advertising system as they called
it. After the innovating content providing, this facebook move
quickly appears like a failure on their perfect management.


More than 60 companies, including Blockbuster Inc., CBS Corp., The Coca-Cola Co.,
Sony Pictures Entertainment Inc. and Verizon Communications Inc., have already
signed up to use the new Facebook advertising system. Facebook ads have three
parts..

The first will allow businesses to build pages on Facebook to connect with the
consumers they are targeting.

The second will include a system that supports the spread of marketing messages
virally through Facebook Social Ads.

Finally, the system will allow the businesses to gather insights into users' activity on
Facebook.

More than 100,000 new Facebook pages will be launched soon by various advertisers.
On these pages, businesses will be able to add any content they want, including
photos, videos and music. In addition, developers have already created a variety of
applications for booking reservations or providing restaurant reviews that can be
used on the commercial profile pages.



Press review – facebook a friend ?                                                   6/8

Loïc Kenmogne, Narjiss El Abbassi Chkara
For example, Coca-Cola announced a new Facebook page that will feature its Sprite
brand and will allow users to create, configure and interact with an animated Sprite
character. The company also plans to run a series of ads for Sprite targeted at
Facebook users.

Facebook users will be able to share information about a business directly with the
company by adding reviews or other information to that business' page.

Facebook also will give marketers metrics on activity, ad performance and user
demographics to help them with ad targeting, Facebook said.

Once again, Facebook is innovating, this time for the advertiser. But this new deal is
clearly pushing the first objective of privacy far away from the prior proinciple. A
condition that the facebook users were not necessary ready to endorse.


                                                       Users 1 – Facebook 0.5
There were no need to wait for having a feedback on this new deal. The very reactive
internet community did not wait longer to express its frustruation with a large
system of information organized around blogs, forums and web sites. The news were
already widely spread by the traditional Press, presented as “ Facebook was
betraying its users”.

Users feel like their intimity was about to be reveal for commercial purpose. Because
the information contain on this profile could be more or less secret, this intention was
perceived as an intrusion.

A lot of users were planning to close their count if ever Facebook was running this
move. An advertisment that Facebook had not really planned.

Due to this rude reaction Facebook had to readjust its shot to reassure their partner at
least. And they recently announced that they were giving up this solution.

But they precised that they will still act for this evolution to a targeted advertising,
but this time with the permission of each one of their users.




Press review – facebook a friend ?                                                         7/8

Loïc Kenmogne, Narjiss El Abbassi Chkara
It is amazing to see how much such a healthy company as Facebook could be blinded
by its own success. You could have expected even from a junior manager to analyse
deeply the situation before announcing this kind of policy’s changement. Personally,
we think that their major mistake was in the communication process. How come they
could have imagined that the only part involved in this deal was them, Facebook,
and the advertisers when the only thing they had to sell was belonging to Mister X!

As soon as this mister X felt as ejected from this discussion, he had to react. That is
why i think Facebook did not completely abandon this idea which is really an
evolution, to me, in advertising. They just postpone it, with giving more visibility all
their users.




Press review – facebook a friend ?                                                    8/8

Loïc Kenmogne, Narjiss El Abbassi Chkara

				
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posted:6/26/2011
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