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Facebook for All

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  • Facebook is seeking avenues to grow as a company and address competitors in the continuously changing social networking landscape.
  • Points of interest:1) “Facebook helps you connect and share with the people and businesses in your life.”2) Search bar on left side allows public access to Pages.
  • Transcript

    • 1. forAll
      George Dy, Tian Wang, Timothy Yung, Anhang Zhu
    • 2. Agenda
      Background
      Social Media Landscape
      Strategic Issues
      Target Audience
      Recommendation
      Solutions
      Solution 1: Interactive Facebook Pages
      Solution 2: Extend Facebook Credits
      Solution 3: Develop a Facebook Marketplace
      Solution 4: Facebook Questions
      Financial & Technological Impact
      Implementation Timeline
      Conclusion
      Facebook for All
    • 3. Background » Recommendation » Solutions » Impact » Timeline » ConclusionSocial Media Landscape
      Facebook General Statistics
      400+ million users1
      500,000+ active applications1
      1.5+ million businesses have Facebook Pages1
      2.7% of Global Search Search Growth2
      Social Media Statistics
      58.59% on Facebook3September 2009
      30.26% on MySpace3September 2009
      Facebook for All
      1 http://www.facebook.com/press/info.php?statistics
      2 http://www.insidefacebook.com/2010/04/10/facebooks-search-traffic-continues-to-grow/
      3 http://www.hitwise.com/index.php/us/press-center/press-releases/2009/social-networking-sept-09/
    • 4. Background » Recommendation » Solutions » Impact » Timeline » ConclusionStrategic Issues
      Reinforce Facebook’s mission to give people the power to share and make the world more open and connected.
      Facebook for All
    • 5. Background » Recommendation » Solutions » Impact » Timeline » ConclusionTarget Audience
      Cater to existing audience
      Indirectly target older audience
      Business is globalized
      People all over the world have local businesses
      E-commerce plays an increasing role in GDP
      Exploits Facebook’s language support
      Target independent artists and musicians
      Facebook for All
    • 6. Background » Recommendation » Solutions » Impact » Timeline » ConclusionAlternate Audiences
      Why not target teens?
      Why not target children?
      Teenage demographiccontinues to increaseregardless of marketing.
      Facebook for All
      1 http://www.istrategylabs.com/2010/01/facebook-demographics-and-statistics-report-2010-145-growth-in-1-year/
    • 7. Background » Recommendation » Solutions » Impact » Timeline » ConclusionRecommendation
      Facebook must provide a suite of functions to attract users outside key demographics
      Facebook must develop products that create a richer and more interactive experience for businesses
      Facebook must utilize personal social networks to address competing services like MySpace and Yelp, and provide competing resources for independent artists and restaurants
      Facebook for All
    • 8. Background » Recommendation » Solutions » Impact » Timeline » ConclusionFour Solutions
      Solution 1: Interactive Facebook Pages
      Solution 2: Extend Facebook Credits
      Solution 3: Develop a Facebook Marketplace
      Solution 4:Facebook Questions
      Facebook for All
    • 9. Background » Recommendation » Solutions » Impact » Timeline » ConclusionSOLUTION 1 Interactive Facebook Pages
      Problem
      Users without online social networks lack incentives to use Facebook
      Facebook Pages lack user interaction and general accessibility
      Goal
      Establish Facebook Pages to become the de facto social profile for businesses
      Expand Facebook Pages to serve as interactive avenues for general users, not just Facebook users
      Facebook for All
    • 10. Implementation
      Improve general accessibility to Facebook Pages
      Removing “login requirement” increases available audience
      Redevelop Facebook landing page to include page search or directory browsing based on locality
      Begin by targeting restaurants and independent artists to establish Facebook Pages as the default profile for businesses and artists
      Create modules catered to specific page categories
      E.g. reservations for restaurants, music store for artists
      Results
      Expand Facebook’s user base and retain existing users by providing a more interactive experience
      Monetize Facebook pages by offering premium modules
      Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionSOLUTION 1 Interactive Facebook Pages
    • 11. Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionSOLUTION 1 Front Page Mockup
    • 12. Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionSOLUTION 1 Reservations Module Mockup
    • 13. Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionSOLUTION 1 Reservation Notifications
    • 14. Problem
      Third-party developers are using Facebook’s user base and creating more competition for Facebook (e.g. iLike).
      Facebook Credits only used for Gifts (which accounts for 30% of Facebook’s revenue)
      Users are not aware of Facebook Credits and the potential business models are not fully exploited
      Goal
      Promote the use of Credits across more Facebook properties to increase trust in Facebook as a business
      Enable Facebook to serve as a middleman to conduct transactions between its users and itself or businesses
      Use Credits as a method to utilize Facebook’s exclusive eCommerce-style marketplace
      Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionSOLUTION 2 Extend Facebook Credits
    • 15. Implementation
      Allow users to purchase (via gift cards or electronically) Facebook Credits and use them in applications
      Allow users to store and manage credit card information
      Allow users to purchase goods directly via credit card or other services (e.g. PayPal, Google Checkout)
      Develop in-house and acquire promising 3rd-party applications
      Offer incentives to use Facebook Credits outside of the new use for purchase of tangible goods in the marketplace
      Allow Facebook Page owners to upgrade their service for enabled access to specialized business modules
      Results
      Greater monetization for the use of in-house or acquired Facebook applications, increasing revenue streams
      Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionSOLUTION 2 Extend Facebook Credits
    • 16. Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionSOLUTION 2 Existing Business Model
    • 17. Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionSOLUTION 2 Potential Business Model
    • 18. Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionSOLUTION 2Facebook Gift Cards
    • 19. Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionSOLUTION 3 Current Facebook Marketplace
    • 20. Problem
      Facebook does not exploit all the potential eCommerce opportunities involving social networks
      Facebook lacks an avenue for vendors (e.g. with Pages) to sell products and services
      Goal
      Acquire Facebook Marketplace as the de facto destination for all Facebook users looking to shop within friend networks or local businesses
      Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionSOLUTION 3 Develop a Facebook Marketplace
    • 21. Implementation
      Acquire Facebook Marketplace from Oodle.com
      Aggregate all products offered by users or businesses in the Facebook Marketplace
      Create a Facebook Marketplace shopping cart and wish list to aggregate purchases and allow sharing product lists with friends
      E.g. Wishlists will appear on user profiles during birthdays
      Allow users to make online transactions
      Results
      Increase revenue through business and featured product listings
      Encourage the use of Facebook search for eCommerce
      Develop Facebook into a sales intermediary between users, taking a percentage of seller fee
      Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionSOLUTION 3 Develop a Facebook Marketplace
    • 22. Problem
      Facebook is lacking a strong community feel outside of personal networks
      New users lack retention rate because questions are often left unanswered
      Goal
      Develop a stronger Facebook community outside of friends networks to promote higher retention of new users and provide incentives for active users
      Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionSOLUTION 4Facebook Questions
    • 23. Implementation
      Create Facebook Questions to provide a community that answers new user questions about Facebook or anything trending
      Develop a strong community feel that offers support and the promotion to Facebook Expert, which is a title that is offered to the users with highest answer count
      Users can connect with people outside of personal networks if they are lacking friends, greater incentive to stay on Facebook
      Results
      Retain new users and provide stronger community incentives to increase time spent on Facebook by existing users
      Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionSOLUTION 4Facebook Questions
    • 24. Background » Recommendation » Solutions » Impact » Timeline » ConclusionFinancial Impact
      Estimated Annual Profit for Marketplace
      ($60BTraded2)/(90MActive Users2) = $667Traded per Active User
      ($8.7BRevenue)/($60BTraded2) = 14.5%Revenue Margin on Traded Goods
      ($2.4BProfit)/($60BTraded2) = 4%Profit Margin on Traded Goods
      Estimated active users that make at least $50k per year:
      (400M Active Users)(67%1) = 268MPotential Marketplace Users
      1 http://www.socialtimes.com/2010/04/demographic-of-the-7-most-popular-social-media-sites-infographic/
      2 http://investor.ebayinc.com/
      Facebook for All
    • 25. Additional Datacenter
      Due to the increased use in user base and Facebook Marketplace, Facebook will be required to upscale its datacenters in preparation for the surge in traffic
      Even though Facebook has already begun building a 35-acre custom datacenter in Oregon that is scheduled to be available in June 2011, Facebook needs to have enough hardware until this datacenter is complete
      Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionTechnological Impact
    • 26. Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionTechnological Cost
      Estimated Total Cost for Development
      Server Cost (775MUsers in June 20111)/(220MUsers in May 20092)
      = 352% user base growth($25Mserver cost in June 20112) * 352%4
      = $88Mprojected server cost in June 2011
      Operation Cost for Marketplace
      Average: $9.38B
      High: $15.01B
      Low: $1.88B
      1 http://www.insidefacebook.com/2010/04/06/facebook-sees-solid-growth-around-the-world-in-march-2010/
      2 http://www.facebook.com/press/info.php?timelined
      3 http://www.salarylist.com/all-real-jobs-salary-at-facebook-inc.htm
      4 assuming data grows parallel with user growth, compounded over 15 months
    • 27. Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionTechnological Cost
      Estimated Total Cost for Development (cont.)
      Labor Cost
      ($70KAnnual salary for Software Engineers1/12 months per year)*(50Software Engineers)*(9 months)= $2.63M in labor
      Estimated Acquisition Cost
      1 http://www.websiteoutlook.com/
    • 28. Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionImplementation Timeline
    • 29. Stronger Facebook community outside friend networks
      Stronger monetization through Facebook Marketplace
      Utilization of Facebook Credit, line of currency exclusive to Facebook users for exclusive Facebook offers
      Pages become a default profile for business and independent artists, eliminating competition from Yelp and MySpace
      Facebook for All
      Background » Recommendation » Solutions » Impact » Timeline » ConclusionConclusion
    • 30. Questions
      Facebook for All

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