Facebook Hits 250mil Users

Facebook has officially announced that they have hit 250mil users. Friendster, another social networking site that started out much earlier has only about 90million users to date. That’s less than half of what Facebook has.

I think most of the people that are reading this would have a facebook acount. I’d say out of all my friends, every single one an account. Have you ever wondered why facebook is so popular, and how is it Friendster died out? Quite simple actually, its simply because Facebook utilises the full potential of social marketing concept.

Facebook is like a huge status update site. Other than displaying whatever thoughts you have, any thing that you’ve done / participated on facebook will be displayed as news feeds on your friend’s homepage. For example if I a quiz on “Which Hollywood Celeb Am I”, it will be displayed on all my friend’s homepage, that I’ve taken the quiz. The next thing that will probably happen, is that you’ll see that everyone one else is started to take the same quiz.

Now that’s the power of social marketing, something that Friendster didn’t offer.

In addition to that, Facebook is also an open platform whereby third party developers can leverage on it, and build applications (also known as apps). These apps can be anything from games, to quizzes, or simple software. For example there are apps that link your facebook account to your flickr account. Hence whenever you post photos, there will be a status update to notify your contacts on Facebook.

Its a profitable idea to develop facebook apps. Reason being that you can leverage on the existing platform with millions of members. And if the users like your idea, the application will be spread like wildfire. Everyone will be installing it. Advertisements like Google Adsense can be placed on your application page, and hence it becomes a money churning business.

Again another example of social marketing. Friendster didn’t offer this from the start. They only started allowing 3rd-party apps to be developed long after facebook’s success. Which was probably way too late, and too huge an investment to change the existing Friendster structure.

But having said that, it is often wondered, what is Facebook’s actual monetary value. Its true that they have chalked up 250 million registered users. However till date, everything is free on Facebook. Signing up is free, developing 3rd-party apps leveraging on the Facebook platform is also free.

Over the past year or two, Facebook has also come up with their Advertising program. Similar to that of Adsense, advertisers can put up banners on the portal, and the ads are also targeted according to interest groups. However, I’m sure that revenue channel alone is definitely unable to sustain the high expenses and overhead, from staff wages to server & bandwidth maintenance.

But nevertheless, with the number of users still growing at a healthy rate, I doubt that Facebook will die off anytime soon. More importantly is for the owners to decide how to turn the membership into monetary value.

This entry was posted on Friday, July 17th, 2009 at 1:36 am and is filed under Branding, Business, Technology. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.