The Face of Things to Come
The Face of Things to Come
Think you know Facebook? Think again. With the official IPO announcement gaining global attention, it is time to take an in-depth look at the world’s most influential social media site. Not only is it bigger, better and more profitable than you might have imagined…it’s also elegant, influential and just now reading the point of exponential growth!
Big. $100 Billion is the estimated initial valuation for the upcoming IPO but what does that really mean? Facebook is bigger than the entire Internet was in 2004…a mere seven years ago and the year Facebook was originally founded! With over 800 million active users compared to only 757 million Internet users (worldwide) in 2004, it’s a mind numbing figure. But the fun doesn’t stop there! Facebook is bigger than the total reach of the 2011 finale of “American Idol”… by double. Just one more indication of the power of the Internet and the diminishing importance of traditional television. In fact, the entire amount spent globally for advertising during 2011 amounted to $588 billion dollars with television, print and radio accounting for 62 percent (roughly $363 billion). With an initial valuation of $100 billion, Facebook is expected to become a dominant player in the global market. No doubt, one reason that Interpublic Group, one of the largest global ad agencies in the world, was an early investor in Facebook.
Bigger. Given the current size and reach of Facebook, it might seem as though they have reached the limit of their growth. Not so says industry insiders and analysts. By 2015, the online advertising industry it expected to nearly double; growing from roughly $68 billion in 2010 to over $120 billion by 2015 with Facebook positioned as the premier provider with over half the worlds Internet population. Facebook is expected to reach the milestone mark of 1 Billion active users by…are you ready for this?…August of 2012…a mere six months from now. If Facebook were a nation, it would be the worlds’ 3rd largest in terms of outright population. Remember, these are active users as defined by actually logging in and using the service within the past thirty days…not simply the total number of accounts.
Bigger than Big. Facebook has already demonstrated the ability to take on notable giants like Microsoft and now even Google. For instance, Facebook already has more page views than Google and people spend more time on Facebook than nearly any other single site ever. The IPO is larger than Google’s and expected to outpace the growth of the giant search engine in the next several years. Four years ago, people were in a state of shock and disbelief that Microsoft would pay a quarter-billion dollars for the exclusive right to place banner advertisements across the social media site; not only did critics stop laughing but with the expiration of the contract, plenty of large corporations stood in line to have access to the world’s largest pool of consumers.
Better. Facebook isn’t just big…they are better. For instance, one out of every eleven people online go to Facebook. One out of every five page views online are via Facebook. The average time spent per visit to Facebook is 20 minutes…several times that of most other sites. The number one search term is “Facebook”. It has been the number one website in the USA since March 2010 and remained in that top spot ever since. Over 95 percent of visitors return to the site after visiting…an unprecedented number. In short, “Nobody does it better” than Facebook…and that is just the beginning!
The Best. According to Facebook and the financial world at large, the best is yet to come with profound implications for the future of social media marketing firms and small business owners alike. Facebook is just now reaching the point of exponential growth; with just under a 40 percent increase in active users in the past year alone. The numbers are stunning. According to the S-1 statement:
- Facebook has 845 million active users as of 12/31/11…a 39% increase in the past year alone.
- 483 million daily active users…a 48% increase over the same one year period.
- 425 million mobile users…the fastest growing segment of the Internet.
- 100 billion friend connections…yes, Billion with a “B”.
- With 3.7 Billion in revenue, Facebook generated 1 billion in net income (1.8 billion in net operating income).
- Facebook is expected to displace Microsoft and Yahoo in online advertising…this year!
- Going global. Facebook is becoming a prime online destination in multiple nations including India and China…clearly leading the way toward global advertising.
Facebook has a plan and it’s a good one worthy of attention. There is also a lesson to be learned by those in the social media consulting field as well as anyone interested in the future of marketing. According to their own core values, Facebook intends to use these as the cornerstone of future growth:
- Focus on Impact.
- Move Fast
- Be Bold
- Be Open
- Build Social Value
Facebook is clearly profitable but with the upcoming IPO, will be awash with liquidity. It’s only natural to wonder where all that money is likely to go.
Mobile. With more than half of all Internet users now accessing content via a mobile device, mobile marketing is a clear leader. Although mobile advertisers are not yet a part of the Facebook offerings, expect to see them soon. Facebook’s S-1 paperwork clearly denoted this as a major stepping stone with a small advertising strategy expected to begin as early as March. This early entry will push “featured stories” including sponsored links and news items, to mobile viewers.
More Apps. Do more with less. By creating the tools that people want to use, Facebook continues to increase user engagement without the obvious signs of selling. The social nature of app’s allow vendors to interact with clients in new ways without the use of overt traditional “push” techniques.