Facebook’s Business Strategy

image A few weeks ago, I was brainstorming some social media ideas with a colleague who winced a little when I mentioned a feature rich Facebook page. When I asked why, it was clear that they were under the impression that developing on the Facebook platform meant paying a princely sum to Facebook for the privilege.

In fact, Facebook’s business strategy is far more simple than that.

People think Google’s strategy is complex as well, when in fact you can boil it down to a short paragraph: to encourage users to flood the Web with content, making good content hard to find unless you use the best search engine in the market (hint, it rhymes with bugle). Once everyone is using your engine to find content, businesses who want to appear prominently on that search engine will pay handsomely for that ability. The brilliance of this is that Google doesn’t limit itself to the enterprise, large companies with massive budgets, in fact Google makes it easy for everyone to buy its ads – no creative, no agency fees, just good copy and a credit card.

Facebook’s strategy is very similar.

Facebook provides the audience and compelling tools (fan pages) to reach that audience. Anyone with a Facebook account can start a fan page and grow an audience – some do so with huge success. Everyday you read about a group or page with tens of thousands of members – the Canadians Against Proroguing Parliament is a classic example with more than 200,000 fans…and there are many more. com.motion’s monitoring and measurement partner, Sysomos, has a great study on the numbers behind Facebook pages.

This is exactly what Facebook wants you to think!

Facebook lulls you in with promises of a huge audience to have a relationship with and great insights into that relationship! Facebook even provides the platform to heavily customize your fans’ experience (through the Facebook Mark-up Language) free of charge! All you need is a good developer and some imagination.

So you have your Facebook fan page. You have your mousetrap all set up with a steel spring but you’re not getting the results you want – you only have a few hundred fans despite all this money and time you’ve invested in development and content. And those fans are the agency, the client and their networks. Just like Google, the answer is advertising. In order for the average fan page to grow, you need advertising dollars

Therein lies the rub. You could create a viral sensation like Vin Diesel or any of the other top Facebook pages but in reality you’ll need to spend big and, more importantly, keep spending both time and ad dollars on the platform in order to create the same feeling of momentum. Facebook thrives on its viral-ity but in order to achieve true viral-ness, you need to break out of your collective networks and the easiest way to do this is by attracting people you have no connection with. The easiest way to do that? Advertising.

Facebook’s strategy is to build a huge user base (check!), attract big brands (check) and provide the platform for buying meaningful engagement with that user base (check). Everything else, like Facebook Connect, Beacon, Titan and mobile, just feeds into this strategy.

2 Responses to Facebook’s Business Strategy

  1. […] 2010-02-19T13:32:10  facebook's business strategy: [link to post] […]

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: