Why Facebook Revenues Are a Black Spot: This is a work in progress….

  1. Facebook is a relational environment. Consumers want to interact. Not transact.
  2. Facebook is oriented around the web in a single channel space. Hence, consumers expect the experience to be free. Apple and Google now own the mobile2web.
  3. Consumer interactivity in Facebook is based around community. The consumers will protect that space from invading brands at all cost.
  4. A community based model of value creation is the yang of a transaction based corporate sales model.
  5. Often people use Google as an example to justify the future potential revenue success of Facebook. What we need to be reminded of is that Googles revenues and services are a contribution of many of its community of users. In many ways Google ‘clips the ticket’ in very small amounts. 
  6. Google is also based around the community. However, it is my view Google creates an understanding of the community from the underlying analysis of the actual behavioral data. They then leverage that knowledge to create value for consumers and businesses: this is converted into sales revenue. For Facebook the behavioural data is owned by the consumers and community. If Facebook tries to monetize this then there will be a significant ‘yang’ in response.  
  7. Facebook does not leverage the cross channel interactivity. Here are some ideas from my research with Laszlo Sajtos. I call it the LOOP and it is based on the coupling of mobile and TV channels. However, the principles are equally applicable between social media and mobile: Measuring Consumer Interactivity in Response to Campaigns Coupling Mobile and Television Media

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