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FACEBOOK CASE STUDY

By MTiPO:
Desiree Fabunan
Yee Han Kuan
Svyatoslav Mishchenko
Patrick Lin Ngai Lung
Wenhan Zhou
DECISION
 Problem:
 Growth/Expansion Strategy

 Proposed Solutions:
1. To Grow Internationally
2. To Enter Different Market Segments
3. To Concentrate On Increasing Per-User Revenue

 Assumptions:
1. User base higher priority than revenue
2. Significant number of countries with small Facebook user base
3. Facebook has the capability and resources to localize
4. Growth is viral

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SWOT ANALYSIS
Strengths Weaknesses

• Truly compelling product • Low revenue per user


• Continual viral growth • Currently only support English
• Virtually unlimited feature set (limited market)
• High user retention • Inexperienced in overseas
market & culture
• High learning curve for new
users

Opportunities Threats

• To grow internationally • Emergence of better social


• To open up different segments networking websites
• To concentrate on increasing • Lose its appeal to users
company revenue • Privacy issues
• Financial threat due to
impending lawsuit (ConnectU)
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ANALYSIS –ECONOMIC ANALYSIS
Target New Improve Revenue
Segment in Source in Existing
Existing Markets
Markets
ApproacExisting
h New

Existing
Product
s New

New
International Existing
Custom
Expansion
ers

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Decision: To Grow Internationally.
HOW TO GROW INTERNATIONALLY
 Challenge:
1. It may find it hard to displace the dominant local
competitors.
2. Local resistance to foreign culture.

 How to Grow in other markets


1. Localization through Language
2. Spread Facebook through Evangelist
1. Overseas Student
2. Early Adopters
3. Use Bowling Alley Effect

 Characteristic of a Suitable Initial


Overseas Market
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1. Competing Product is technically weak or clone
2. User base comfortable with Social Networks
REALITY TEST
Risk Mitigation Strategy Contingency Severity Probability
Plan
Market Facebook does not To hire local talent to localize Establish a High Medium
gain a foothold in the website. partnership with
overseas market local social
Target Initial Segment to network
Students whom have are
returning from overseas
studies

Team Inexperienced in To hire someone with Buyout local Medium High


oversea culture & experience taking a website networking
management internationally website

Technology Emergence of Improve the facebook feature Adopt & learn from Medium Low
superior social to ensure it remains appealing other competitors
networking website to the users

Financial Substantial Marketing Improve advertising model. Seek other High Low
Investment required sources of
expanding into revenue
overseas market

Decreased in
revenue/user in
international market