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Case Study

Facebook

Summary

Facebook has brought a whole new level of personal marketing to the world of
business. The social networking Web site fulfills people’s desire to communicate and
interact with each other and uses that power to help other companies target very specific
audiences with personalized messages. Facebook was founded in 2004 by Mark
Zuckerberg, who was a student at Harvard University at the time and created the first
version of the Web site in his dorm room. Zuckerberg recalled, “I just thought that being
able to have access to different people’s profiles would be interesting. Obviously, there’s
no way you can get access to that stuff unless people are throwing up profiles, so I wanted
to make an application that would allow people to do that, to share as much information as
they wanted while having control over what they put up.” From the beginning, Facebook
has kept its profiles and navigation tools relatively simple in order to unify the look and
feel for each individual. Within the first 24 hours the Facebook Web site was up, between
1,200 and 1,500 Harvard students had registered and become part of the Facebook
community. Within the first month, half the campus had registered.

Today, Facebook is the most popular social networking Web site in the world, with
over 500 million active users. The site allows users to create personal profiles with
information such as their hometowns, work, educational background, favorite things, and
religious affiliation. It encourages them to extend their network by adding other users as
friends, and many people try to see how many “friends” they can accumulate. To interact
with Facebook friends, users can send messages; “poke” each other; upload and view
albums, photos, games, and videos; and “tag” or label people in their photos. They can post

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comments on friends’ “walls” and create status up- dates viewable to everyone. In
summary, Facebook is full- filling its mission to “give people the power to share and make
the world more open and connected.” In 2010, Facebook surpassed Google as the top Web
site in the world based on unique visitors per month and also ranked number one for number
of pages viewed per month. Facebook has become an important part of consumers’
everyday lives and therefore a critical component in personal marketing strategies.

Questions

1) Why is Facebook unique in the world of personal marketing?

a) Keeping Personal and Public Facebook Content Separate

One of the top concerns you might have about mixing your marketing messages
with your personal profile is keeping your personal things personal. You can keep
everything separate by turning on the allow subscribers setting. To do so, go to your
Account Settings > Subscribers.

b) Suggest Your Page to Friends

If you have lots of friends on Facebook, but not lots of fans on your business page,
you can suggest your business page to them. Go to your Facebook page’s Admin
Panel > Build Audience > Invite Friends.

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c) Subscribe to & Comment on Personal Profiles

Want to get your name in front of someone specific, but don’t know them well
enough? Why not subscribe to their personal profile (if available) and start
engaging on their public updates (if allowed).

d) Participate in Groups

While many groups on Facebook are polluted by spam, there are some good ones.

e) Segment Friend Lists for Targeted Messaging

When it comes to posting updates on your Facebook business page, you can either
send your update publicly or target it to people in a specific location. On your
personal profile, you have a lot more options. You can target your status updates to
particular people or people on a friends list.

f) Send Private Messages

Although Facebook has opened the door to allowing business pages to receive
private messages, they still can’t send them unless it is a reply to one they have
received. With your personal profile, you can send private messages to one or more
friends at a time. Just because you can send messages to multiple people at once
doesn’t mean you should though. Individual, personalized messages go a long way.

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2) Is Facebook just a passing fad is it here to stay? What are the company’s greatest
strengths and risks?

As my own opinion, Facebook is here to stay for the following decades.

a) STRENGTHS

The success of Facebook today are because of the strengths possesses by


the company. Strengths are resources and capabilities that can be used to gain
competitive advantage. Facebook have its own strength to enable it to get to this
stage. Facebook is the biggest and the strongest brand name in social networking.
Facebook have become a global phenomenon with presence of over 70 languages,
which provides convenience especially for those users who cannot understand
English. Signing up for Facebook is easy and free. Therefore, the present users on
Facebook are around 600 million and increasing. Facebook provides the easiest
mode of communication with friends and colleagues from all over the world.

Facebook not only able to attract users, but it also knows how to maintain
their users. The policy and services of Facebook pleases the users and the privacy
settings are easy to modify depending on the users’ wishes. Basically, Facebook
understand their customers’ wants and behavior. Since Facebook have wide
number and range of audience, it has become one of the favorite platforms for
businesses, organizations and companies to get tons of publicity for their marketing
strategies.

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b) WEAKNESSES/RISKS

Weaknesses are the factors that could prevent successful results within a
company. Weaknesses can damage a project even before it begins; even Facebook
is not excluded from having its own weaknesses.

Facebook gain more than 80% its revenues from advertisements on its social
network. However, the revenue is depends proportionally on the growth of users
which eventually can be only marginal as the social network already has so many
users. Other than that, Facebook is unable to make profit from its mobile user even
the latter cover about 60% of the total Facebook users.

There is barely any restriction to sign up for Facebook, therefore fake


accounts can be made easily. People often misuse those account and make other
users felt insecure. The lack of Facebook security also makes it vulnerable to spam
and attacks of viruses and hackers. Such attacks happen every day and thousands
of passwords were stolen.

3) Discuss the recent issues that challenged Facebook. Will privacy restrictions
limit its ability to offer personal marketing opportunities?

a) Widening exposure of member information 2011–12

In 2010, the Electronic Frontier Foundation identified two personal


information aggregation techniques called "connections" and "instant
personalization". They demonstrated that anyone could get access to information

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saved to a Facebook profile, even if the information was not intended to be made
public. A "connection" is created when a user clicks a "Like" button for a product
or service, either on Facebook itself or an external site. Facebook treats such
relationships as public information, and the user's identity may be displayed on the
Facebook page of the product or service.

b) News Feed and Mini-Feed

On September 5, 2006, Facebook introduced two new features called "News


Feed" and "Mini-Feed". The first of the new features, News Feed, appears on every
Facebook member's home page, displaying recent Facebook activities of the
member's friends. The second feature, Mini-Feed, keeps a log of similar events on
each member's profile page. Members can manually delete items from their Mini-
Feeds if they wish to do so, and through privacy settings can control what is
actually published in their respective Mini-Feeds.

Some Facebook members still feel that the ability to opt out of the entire
News Feed and Mini-Feed system is necessary, as evidenced by a statement from
the Students against Facebook News Feed group, which peaked at over 740,000
members in 2006. Reacting to users' concerns. Facebook developed new privacy
features to give users some control over information about them that was broadcast
by the News Feed. According to subsequent news articles, members have widely
regarded the additional privacy options as an acceptable compromise.

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c) Inability to voluntarily terminate accounts

Facebook had allowed users to deactivate their accounts but not actually
remove account content from its servers. A Facebook representative explained to
a student from the University of British Columbia that users had to clear their own
accounts by manually deleting all of the content including wall posts, friends, and
groups. A New York Times article noted the issue, and raised a concern that emails
and other private user data remain indefinitely on Facebook's servers. Facebook
subsequently began allowing users to permanently delete their accounts in 2010.
Facebook's Privacy Policy now states: "When you delete an account, it is
permanently deleted from Facebook."

d) Per formative surveillance

The notion that people are very much aware that they are being surveyed on
websites, like Facebook, and use the surveillance as an opportunity to portray
themselves in a way that connotes a certain lifestyle—of which, that individual
may, or may not, distort how they are perceived in reality. In my own opinion,
privacy restrictions will not limit its ability to offer personal marketing
opportunities. Here are some suggested solutions to deal with the privacy issues:

 Develop user-centric privacy controls to give customers control.

 Avoid multiple intrusions.

 Prevent human intrusion by using automation wherever possible.

 Let your consumers know you value their privacy and publicize what you
are doing to keep their information secure. Prominently display BBB-

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certification and other security logos on your Web site and dedicate an
entire page to your privacy policy. This will give your Web site additional
credibility and build trust in your brand.

 Let consumers know when their information is being disclosed. If you plan
to use their information for one reason or another, tell consumers at the time
you’re asking for the information. For example, have a sign at the cash
register, a note at the bottom of a receipt, or a pop-up window on your site
before they check out. Also, offer the opportunity for consumers to decline
to provide certain information or opt out of the database.

 Tell them why you’re asking for their information, and be honest. Many
brands ask for consumer’s date of birth to send birthday coupons. Some
brands need consumers’ zip code and license number for their return policy
because they use return tracking services, like The Retail Equation (TRE)
to fight crime. Best Buy, for example, includes their disclosure information
and an explanation of how TRE works on their Web site.