Amazon, Facebook Google Case Study

Week 3 – Amazon, Apple, Facebook, Google

Facebook SWOT

Facebook is an online social networking platform that was launched in 2005. The company only began growing in 2009, following the epidemic and increasing trend of time spent online by people globally. Below is a SWOT analysis of Facebook to gain insight into the company’s internal strengths, weaknesses, opportunities, and threats. These will aid in identifying the company’s business problem, and in turn an appropriate solution followed by details of its implementation.

Strengths:

• Leader in share of hours spent online per week in the United States (accounting for a quarter of all time spent online)
• Integration with other websites, services, applications (Facebook Gifts, Facebook Exchange, local retailing app)
• High global reach and exposure (153 million users globally, as of 2013)

Weaknesses:

• Slower to attract online advertisers than competitors (Google)
• No significant presence in the $16 billion U.S. paid-search markets

Opportunities:

• Gain a competitive edge in advertising using its unique tools and features (such as data from ‘likes’ and the ability to ‘tag’ friends
• Development of more sophisticated programs/technology to further exploit mobile advertising that will reach its users and make ads effective

Threats:

• Stronger competitors taking larger shares of the online advertising market
• Mobile phones being ‘inhospitable’ to advertising due to the relatively smaller screen display
• Internet users installing ‘AdBlock’

Key Problem in case:

Facebook is lagging and falling behind in market share of the paid-advertising market and is slow to attract online advertisers. Even though it is strong in other areas such as display advertising, it is missing out on a significant amount of potential revenue.

How can we increase market share in the paid search-advertising market?

Implementation Plan

Facebook needs to change its strategy and place a focus on in the paid-search advertising market. That is, it could optimise its search bar as a form of a ‘search engine’ and filter out searches with commercial phrases, or any that are related to particular businesses. Given that Facebook is such a powerful tool, with a significant amount of daily users, the searches made on their platform could potentially be more personal and specific to their needs. In turn, advertisers should be able advertise on users’ Newsfeeds (or other platforms) and pay per click based on the data they are being given.