The Business of Facebook
| The Business of Facebook | Assignment 1 | | | 6/3/2012 |
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INTRODUCTION
The business model of any organization is very important in helping a business become successful or unsuccessful. They help guide the leaders in the company to reach the goals and purpose of their organization. In recent news, the business model of Facebook has been under a large amount of scrutiny. I will be analyzing the business model of Facebook using the definition of business model from the textbook which states “A business model defines how an organization interacts with its environment to define a unique strategy, attract the resources and build the capabilities required to execute the strategy, and create value for all stakeholders” (Applegate, Austin & Soule, 2009).
STRATEGY
There are four key dimensions to strategy: market positioning, product positioning, business networking positioning, and boundary positioning. These four dimensions combined help an organization develop a strategy which by definition of the textbook is the series of choices that determine the opportunities you pursue and the market potential of those opportunities (Applegate, Austin & Soule, 2009).
In order to analyze the business strategy of an organization you must first determine what kind of business it is (Applegate, Austin & Soule, 2009). In E.B. Boyd’s (2012) article “What is Facebook’s Business” she states “[Facebook] creates a place for people to hang out and upload photos or pithy notes on what they are doing right that second, and then it posts advertising along the side of that status update highway.” Facebook services 845 million members all over the world, excluding China where Facebook has been blocked by the Chinese government. In December of 2011 Facebook averaged a total of 483 million daily active users worldwide (Form S-1, 2012).
For a company such as Facebook, marketing position is very important. Market positioning determines the selection of
|
INTRODUCTION
The business model of any organization is very important in helping a business become successful or unsuccessful. They help guide the leaders in the company to reach the goals and purpose of their organization. In recent news, the business model of Facebook has been under a large amount of scrutiny. I will be analyzing the business model of Facebook using the definition of business model from the textbook which states “A business model defines how an organization interacts with its environment to define a unique strategy, attract the resources and build the capabilities required to execute the strategy, and create value for all stakeholders” (Applegate, Austin & Soule, 2009).
STRATEGY
There are four key dimensions to strategy: market positioning, product positioning, business networking positioning, and boundary positioning. These four dimensions combined help an organization develop a strategy which by definition of the textbook is the series of choices that determine the opportunities you pursue and the market potential of those opportunities (Applegate, Austin & Soule, 2009).
In order to analyze the business strategy of an organization you must first determine what kind of business it is (Applegate, Austin & Soule, 2009). In E.B. Boyd’s (2012) article “What is Facebook’s Business” she states “[Facebook] creates a place for people to hang out and upload photos or pithy notes on what they are doing right that second, and then it posts advertising along the side of that status update highway.” Facebook services 845 million members all over the world, excluding China where Facebook has been blocked by the Chinese government. In December of 2011 Facebook averaged a total of 483 million daily active users worldwide (Form S-1, 2012).
For a company such as Facebook, marketing position is very important. Market positioning determines the selection of
References: Applegate, L., Austin, R., and Soule, D. (2009). Corporate Information Strategy and Management (8th ed.) New York: McGraw Hill. Blum, Jonathon (2012) Is Facebook Advertising Too Cheap? Retrieved from http://www.forbes.com/sites/thestreet/2012/02/08/is-facebook-advertising-too-cheap/ Boyd, E.B. (2012). What is Facebook’s Business? Retrieved from http://www.fastcompany.com/1813498/facebook-s-1-offers-peek-at-core-business-and- challenges-to-come Carlson, Nicholas. (2010). Meet Facebook’s (Soon-To-Be) Billionaires. Retrieved from http://www.businessinsider.com/meet-facebooks-soon-to-be-billionaire-shareholders-2010-5?op=1 Chao, Loretta. (2010). Mr.Zuckerberg Goes to China. Retrieved from http://online.wsj.com /article/SB10001424052748703814804576035143409583806.html Dignan, Larry (2012). Facebook’s IPO: Massive valuation brings business model scrutiny. Retrieved from http://news.cnet.com/8301-1023_3-57435287-93/facebooks-ipo-massive-valuation-brings-business-model-scrutiny/ Facebook.com. (2012) Form S-1 Registration Statement of Facebook, Inc