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MI021/CS021:Computers in Management
Oct. 14, 2011
Facebook Case
Prof. John Gallaugherwww.gallaugher.com
written case available at www.gallaugher.com/chaptersCopyright ©1997-2010 John M. Gallaugher, Ph.D. All rights reserved
Note: not all images cleared for commercial copyright.
Issues Covered
• Background on Facebook– Competitive advantages– Facebook vs. the Competition
• Key efforts– Feeds– Platform– Beacon– Facebook as The Web’s Plumbing
• Advertising challenges & opportunities
Source: http://www.emarketer.com/Article.aspx?R=1008598
Feeds = Ebola for Data Flows
Organic or Earned Ads:Free ads that come from people
promoting products on their own.
Organic or Earned Ads:Free ads that come from people
promoting products on their own.
Facebook Encroaches All
Source: TechCrunch: http://www.techcrunch.com/2008/09/05/googles-picasa-becomes-more-flickr-like-adds-new-ways-to-explore-interesting-public-photos/
15
Hunt vs. Hike
• Click-through rates– Google: 2%– Facebook: .04%
• CPM– TechTarget: as much as $100 and above– Technology Review: $70– Mashable: $7 - $33– Facebook (via Lookery): 13¢– Facebook (targeted ads): 15¢
15
A Volume Biz:Lots of Impressions at Less Revenue
Sources:http://news.cnet.com/8301-13577_3-20004779-36.html?part=rss&subj=news&tag=2547-1_3-0-20http://online.wsj.com/article/SB10001424052748704436004576297310274876624.html#ixzz1LCFVtMRC
BUT all this with NO ad network!(Google, Microsoft, Yahoo, AOL also run ads on other sites)
BUT all this with NO ad network!(Google, Microsoft, Yahoo, AOL also run ads on other sites)
A GLOOMY FORECASTCan social-networking sites continue to make significant inroads into the U.S. online advertising market? The outlook is uncertain. A shaky economy and setbacks in targeted-advertising initiatives have caused leading online marketing research firm eMarketer to project more modest revenue growth for social-networking sites over the next four years than it had previously predicted.
THE GLOBAL VIEWSocial networking is a global phenomenon, and reaching users outside the United States will become increasingly important as advertising dollars flow to Western Europe, Asia, and beyond. Source eMarketer / Technology Review
Revenue Per Unique Visitor
Source: Business Insider March 18, 2010
You are Part of the Targeting
Organic or Earned Ads:Free ads that come from people
promoting products on their own.
Organic or Earned Ads:Free ads that come from people
promoting products on their own.
What Happens in Vegas Stays on Facebook (& YouTube, Flickr, Twitter, ...)
Source: CNet, Wonkette, and CBS Evening News, quote from Socialnomics