I read an article from the Yahoo! News website (cited below) titled “Exclusive: Facebook double first-half revenue” (2011) by Alexei Oreskovic. The social networking site Facebook had revenue of $1.6 billion in the first half of this year, but that was not what I took from this story; it was some choice comments from the article about why the site made so much money and what value the site has that struck me.
“‘We really see Facebook as becoming like the operating system for delivering ads on the Internet,’ said Dave Williams, the CEO of Blinq Media, which runs ad campaigns for companies on Facebook.” Does that sound like what Facebook is to you? Perhaps, but for the vast majority of its users, advertisements are not what Facebook is about. However, according to industry players and capitalists, that is exactly what Facebook is. When you look at modern advertising today across television, radio and such, there are plugs to visit a company’s Facebook page for special offers, news, etc., and it’s easy to see that marketing and data collection of some form is in full force. Since Facebook users provide all the information themselves, it’s not surprising to see that same CEO say that “Facebook's social network, in which users endorse products and companies by ‘liking’ pages, provides a treasure trove of valuable data that other online services can't match.”
I don’t like the prospect of myself becoming social media fodder for companies, but with so many millions of users on Facebook, it’s impossible for me to avoid. At the end of the day, the site’s advertisers want to turn us into marketing tools, and as long as enough users are willing to part with their information to third parties by ‘liking’ a page and spreading around a company’s incentives to their friends, there will be a market like Dave Williams is describing. As long as that market potential exists, Facebook will surely keep on making the big bucks.
Oreskovic, Alexei. "Exclusive: Facebook doubles first-half revenue." Yahoo! News (2011): 8 Sep 2011. <http://news.yahoo.com/exclusive-facebook-doubles-first-half-revenue-001922607.html>.
As an advertising major, I am always aware of how much advertising Facebook actually has. Facebook really does have the power to know what you like and what your interests are and they use all the information you put on your Facebook to send target ads your way. I personally like shopping online and movies. All of the ads suggested on my page involve shopping sites like renttherunway.com. I agree that its hard to accept the fact that we are open for companies to exploit because of the amount of time we spend on Facebook but it is what today’s advertising and marketing has become.
ReplyDeleteThat sounds like a pretty interesting article! I used to always wonder exactly how Facebook became a billion dollar company when all of it's services are free... but of course, I eventually realized it was all those annoying ads that show up in the side bar everytime I log on. It's interesting to see how a lot of companies use Facebook to promote their businesses through page "likes" or even company profiles. Another form of advertising I've noticed is the realtively new feature/ability to "check-in" whenever you go places (i.e: the gym, school, a restaurant, etc). Although most people use it as a way to sort of show off, I've noticed that a lot of companies have taken advantage of the feature by offering discounts to customers who check-in at their business. This happened to me on two occasions, the first time happened when I went out to a family dinner and the restaurant we went to featured a deal for a free entree with a purchase of an entree if you check in on facebook! The other time happened when I checked in at the clothing store "H&M" and happend to snag a deal of 20% off just for simply checking in on facebook! It's amazing how advertising is so in our face, yet most of the time we never even realize it.
ReplyDeleteThis sounds like an interesting article, it is insane how much Facebook is worth. It's even more insane how many people use Facebook constantly. I often worry that there are going to be intelligent and qualified people who will not be hired for certain jobs because of things they posted or said on Facebook in years past. I hope the hacker group 'Anonymous' is really able to hack and take out Facebook like they claimed they'd be able to.
ReplyDeleteMan, I hope ads don't start popping up randomly on Facebook. That would be so annoying! If I have to watch a video before I can view my news feed I am going to deactivate my account! Anyhow, Facebook is a good marketing tool for users and companies. What I like is that we are able to choose what we want marketed to us. We do that by 'liking' a page for a particular brand, product or cause. That way we aren't bombarded with random ads. But I do hate when they spam my news feed by updating too much.
ReplyDeleteLet's face it. Social Media is the new cheap, free platform for marketing do we'll be seeing a lot of it.