Facebook Three-Year Strategic Plan (pg. 411 summary)

Revenues for Facebook

1. $3,851 million in revenue at the end of 2014 2. 3.6 billion in advertising revenue (total) 3. $257 million in total costs from collected payments/fees

Facebook's segmentation

A. Separated by 4 regions, revenue source, and Payments/Other Fees Half of Facebook's revenues are generated from U.S. and Canada

Facebook user numbers

End of 2014: 1) 890 million users 2) 745 million daily active mobile users

True or False? Cookies are outdated technology

True Digital marketers have been constrained by cookies, which are still used to measure and target digital ads

Is Facebook the largest social media network in the world?

Yes (with 1.3 billion current active users)

Was Mark Zuckerberg accused of stealing someone's idea when he made Facebook?

Yes, three Harvard seniors sued Zuckerberg. Settled in 2008 for 1.2 million shares of Facebook's IPO

What is Facebook's audience network?

- this program allowed advertisers to run their Facebook ads on third-part mobile applications (Spotify for example) ^ launched in 2014 (Also in 2015, Facebook nveiled a mobile advertising distributor that's similar to Twitter's MoPub) ^ attracting more business

Instagram's growth

1. # of users climbed 60% to 64.2 million in 2014 - Twitter only increased by 12% (and is expected to decline after 2015) 2. Instagram's user growth = 21% in 2015, 15% in 2016, and 10% in 2017 3. Analysts by 2018 = Instagram will have 106.2 million users

Competitor analysis Snapchat

1. 2013 = Snapchat launched Snapkidz (for users 13 and younger) ^ This service restricts photo sharing 2. Snapchat is growing in advertisers (started with the Ouija film) 3. Snapchat = caters to sending 700 million videos/photos (take photos, record videos, text/drawings, and send them to a controlled group of recipients; based on friends) Snaps - photos/videos sent out to people 4. Data = 700 million photos/videos per day, 500 million views per day, $10-$20 billion in valutaion

Instagram (summary)

1. Facebook acquired Instagram 2. Instagram's demographic = teenagers 3. Leading photo-sharing and video-sharing social media 4. Top 100 million users in the US by 201 - surpassed Twitter in 2015, 2nd most used social media (next to Facebook) 5. 62% of all teens used Instagram regularly in 2014

Future for Facebook and Social Media

1. Google & Facebook are becoming closer friends - both want: a) more people online b) clicking on ads c) both are exploring new ways to get people online and click on ads d) both are developing drone cell towers (partnering with telecom) to get people more hooked on apps 2. Internet.org program = create new users in countries with little/no internet use (Zambia, Ghana, Kenya, Tanzania, Colombia, India)

Facebook's Competitors

1. Instagram 2. Snapchat 3. LinkedIn 4. Google+ 5. Twitter

Two disadvantages of Facebook

1. Many people lose significant productivity at work (spending too much time on it) 2. Major privacy concerns (information leaks can land in the hands of competitors)

Twitter (4th competitor)

1. Social Network for Tweets 2. Tweets = 140 characters 3. 500 million users Income streams = paid advertising, and others (also a self-service advertising system for small business owners) Revenue = 1.4 billion in 2014

External Issues of Facebook

1. Social media users increasingly feel commercialized when pop-up ads cover their computer screens (on Facebook) - Companies need to figure out a way to utilize advertising without making users uncomfortable 2. Children under 13 must have parent consent under COPPA for Facebook 3. Social Media addiction = 1:8 users - declining relationships, anger/depression, and lying addiction = covering up problems 4. Political issues - Egyptian government banned Facebook - Facebook created a PAC with the Federal Election Commission (banned by People Republic of China and Iran) - Mainland China didn't block Facebook, but government intervention has slowed down Google+ to the point that it's impractical.

Three major business units of LInkedIn

1. Talent Solutions - Companies can utilize this for employee procurement 2. Marketing Solutions 3. Premium Subscriptions LinkedIn acquired Digg (a social news site)

Major Questions for Facebook

1. Where will the large amounts of data be stored? 2. Who'll control the stored data? 3. Will government intervention play a part of using the stored data? 4. Does Facebook have a right to store and even sell this information?

3 desires for Mark Zuckerberg for Facebook's vision.

1. stay connected with friends/family 2. discover what's going on in the world 3. share/express what matters to the individual

Percentage of fake Facebook accounts

10%

Minimum age to use Facebook

13

LinkedIn's market penetration

2014 = highest in the US, UK, Canada, and Australia (India = fastest-growing country of LinkedIn users) = 20 million in 2014

How did Facebook replace cookies (in a way)

2015-2017, Facebook's Atlas (an ad server) takes digital marketing beyond cookies 1) more accurate than cookies 2) records mobile activity Atlas strives to connect offline purchases and conversions to digital ads across mobile apps/web

How much of Facebook's revenue goes into R&D?

29% went into R&D in 2014 $1,831 billion on purchasing new property and equipment

Facebook's marketing Strategy (Part 2) What are product ads?

Ads that show users pictures of products/prices (When a user views a product on a website, that same product gets shown a picture on Facebook) Facebook uses cookies to advertise their users interests/location (and recommends products based on it).

Facebook Atlas

An ad server that allows ad buyers to measure, target, and optimize digital/mobile ads across digital apps Way more accurate than cookies

What's a cookie

Bits of code dropped into web browsers that gives a generate (poor) approximations of how many people view a digital ad. Gives inaccurate estimates of how many individuals see an ad. (Unreliable measures of clicks and sales, not used on mobile)

Facebook vs Linkedin (2014)

Facebook = 1.35 billion users (864 million daily users) Linkedin = 332 million registered users, but only 90 million daily visitors (September 2014)

Facebook's Code of Conduct

Facebook Personnel are expected to act: 1) lawfully 2) honestly 3) ethically 4) and in the best interests of the company while performing duties on behalf of Facebook B. The code of conduct applies to all Facebook personnel (BOD, officers, employees, corporate affiliates, contingent workers, and others working on Facebook)

Facebook's organizational structure All subsidiaries

Facebook''s 14 subsidiaries 1) Facebook Benelux 2) Facebook Brazil 3) Facebook Canada 4) Facebook France 5) Facebook Germany 6) Facebook India 7) Facebook Italy 8) Facebook Korea 9) Facebook Norway 10) Facebook Portugal 11) Facebook Spain 12) Instagram 13) Oculus VR 14) What's App

True or False, Google and Amazon surpasses Facebook in market share and number of users (2014)

False, Facebook surpassed both Google and Amazon in market share and user-base (Peter Thiel bought the domain name facebook.com for $200,000) Accel invested in 12.7 million and Jim Breyer added $1 million of his own money

Digital Display Ad Revenues Which company makes the largest share in ad revenue?

Google This graph includes computers and mobile devices

Google (Third Facebook Competitor)

Google+ = social network of 540 million active users 30% of + users are mobile 2. Other services include Hangouts, Hangouts on Air, +1 3. Search Engine Optimization (SEO) benefits both users and advertisers

What is Mark Zukerberg's goal for global comunication

He wants to aggressively help phone companies build Internet connections globally.

Personal Branding

Individuals are combining their social media applications to create a personal rand or image that directly relates to future employment - New trend - Example = HRM managers performing a search on potential employees

What's Facebook Professional?

It enables users to keep their personal postings, pictures, and identity separate from the professional/work content. - offers online chatting with professional colleagues Rivals Linked-in B. Has tools to store documents (Onedrive competitor)

What is Facebook's company structure?

It's a hybrid, being divisional by region and by product (structure is too complex wth overlapping duties) Facebook prefers to see something similar to a strategic business unit (SBU) structure

Example of HRM search

Klout = society has become aware of individual brands They measure social media analytics from 1-100 (Obama = 99) The higher the score, the better it is for individuals to be hired in the US Klout uses Bing, Facebook, Foursquare, etc.

How much of Facebook's revenues come from outside the U.S.

Only about 50%

LinkedIn Corporation (another Facebook competitor)

Professional social networking service - 260 million users in 200 countries Headquartered = Mountain View, California

What is Facebook's vision statement?

They don't have a specific one.

Facebook's mission statement

To give people the power to share and make the world more open and connected

Facebook's Marketing Strategy (Part 1) How does Facebook handle entrepreneurs that want to advertise their products to a mass audience?

Until 2014, most Facebook users obtained free marketing and advertising of a product/service by creating posts on their "wall" to a mass audience - However, there's a new system that makes individuals pay Facebook in order to have a product/service gain mass exposure. "The only way entrepreneurs and small business owners can receive high volumes of distribution of their materials is to pay Facebook for their product service exposure. The more money paid by the individual or business, the more reach their message will be distributed."

Will Facebook Professional charge users for advertising?

We're not sure (2014)

What's the network effect

When you large following becomes a major competitive advantage. - Much of the value comes from the availability of other people with similar interests (interact with them either professionally or personally) Facebook has a major network effect)

Facebook's balance sheet

file:///home/chronos/u-38029a6c1ed37184ecbefc2526cc3c30f3fdf410/Downloads/Facebook's%20Balance%20Sheet%20-%20Sheet1.pdf