Fee-fi-fo-fum, The Stomach of the Facebook Giant is Hungry for Some Revenue
In order to fully appreciate this giant we must first look at the companys stats, because only then can you understand Facebooks trepidation in trying to monetize this valuable asset, and yes they are real numbers.
- Over 1 billion Monthly Active Users (MAUs) as of October 2012
- 552 million daily active users on average for the month of June 2012
- 600 million monthly active user who use mobile Facebook products in September 2012
- Like button has been hit 1.13 trillion times since it was introduced in 2009
- 47% of users report making between $50,000 $99,000 annually (33% between $25,000 $49,999), U.S.
- 57% users report having been to some college (24% bachelors or graduate degree), U.S.
- The average Facebook visit lasts 23 minutes with a 57% female to 43% male ratio and an average age of 22 years
- 219 billion photos uploaded
- 62.6 billion songs played
The company was incorporated in July 2004 and the astronomical growth it has experienced took place in the last four years. In 2008 it only had 100 million users, meaning it acquired 1 billion users in less than four years.
The company stock ($20.22- Oct. 9, 2012 with a 43,318,672,306 market cap) is not fairing well and unless it starts generating some revenue the sell recommendations will start growing while the price of it's share continue decreasing. With his sell rating, BTIG analyst is echoing growing sentiment of the companys inability to create a reliable revenue stream that doesn't alienate it's users. He feels a sell rating is warranted, as well as a one-year price target of $16.
The recent pay per post Facebook released received a lukewarm welcome to say the least and only time will tell if users are willing to pay to get their posts noticed. Additionally, the company is adding collect and want along the like button to give users more shopping options. These features have been compared to Pinterest, and the hope is using a similar platform will help Facebook achieve the high AOV (Average Order Value) of almost two to one Pinterest enjoys over Facebook.
The like button is synonymous with Facebook, and individuals and organizations have gone to great lengths to get a like from users. This was supposed to translate into sales for companies, but the ROI has not justified using this platform for sale conversion for the majority of individuals and companies.
The want button let's everyone know what you want or wish. If you see an item you will be able to flag it and it will be part of your wish list. As of right now seven retailers will provide products to encourage user to buy through Facebook or their online stores.
The collect button works in much the same way, but when you choose an item it will be part of your Timeline. This gives your friends the chance to see what you want to buy or have already purchased. The goal of these new features is to eventually monetize them, and collect transaction fees whenever a user purchases an item, just like the App Store.
So what is Facebook to do, and is social media a realistic commerce solution or a tool to exchange pictures and gossip. Pinterest seems to be doing well but according to a developer of e-commerce tools, social networks are only responsible for 1.3 percent of total e-commerce traffic in 2012. These anemic numbers are sure to put a damper in the efforts Facebook is making, but it can't stop now because the drum beat in Wall Street is getting louder and shareholders are expecting something, anything to justify their investment in this company.
Posted in Web Design Post Date 06/04/2015