Why People Use Facebook and Their Activities - Case Study Example

 Why People Use Facebook and Their Activities People utilize Facebook for its many practical applications and concepts that are geared toward lifestyle enhancement. The profiles of individuals using social media websites are those with a desire to maintain strong social relationships, ensure recreation, and demand product consumption. These needs are fulfilled through the interactive marketplace, vast applications allowing for member interactivity and discussion, and software available to build avatars and personal profiles to highlight individual personality or opinion. Facebook is a platform for improving an individual’s local or national visibility, which appeals to psycho-social concepts of self-esteem development and social belonging which are common emotionally-based needs on Maslow’s Hierarchy of Needs and other relevant, well-respected psychological models. Facebook allows users to interact in the virtual environment in real-time or through messaging and discussion board platforms. Facebook has been very competent in its competitive market orientation which gives the business more competitive advantage. This is supported by the volume of time the user remains in certain areas of the website. The case study identifies that average browsing time in the marketplace is one hour and twenty two minutes. This is quite an accomplishment when other sites selling products in similar categories have a difficult time keeping customers browsing through their online product pages without clicking off or transferring to competitor websites. In addition, the average time per user when connecting with applications (such as gaming) is over four hours. The interactive applications sustaining such a high timeframe during the visit includes 14 million unique visitors and 88 million total visits in 2007, which indicates considerable loyalty to Facebook applications for returned visitors. Again, this is an excellent achievement which suggests a great deal of brand loyalty and brand preference exists among other social media competition. Marketing theory proposes that some of the most successful marketers find success through psychographics, which is linking lifestyle to needs fulfillment to create a positive brand with the customers. Facebook provides a medium that allows for free expression of values, principles, and even opinion on a variety of different, relevant concepts in society such as politics and government, social systems, education, and even retailing which is widely appropriate for a mass market focus. This is why people use Facebook: The website provides opportunities to increase the users’ significance in society and instills a sense of social importance, especially when the website indicates a great deal of visitors have viewed their personal pages and message boards. It provides a virtual gateway for an individual to move from social obscurity to elevated status based on peer opinion or other eye-catching content posted by the user that appeals to mass markets of users and consumers. So much of the appeal of Facebook is linked to the psycho-social dimensions of human society that improves state of mind and even identity formation for younger and more impressionable users that look toward aspirational reference groups to guide their behavior and attitudes. It also maintains the ability to break down tangible geographic barriers to allow a user to interact with different national or global subcultures, thus it can be a social learning tool as well. EVALUATING FACEBOOK ADVERTISING EFFECTIVENESS The pricing structure for Facebook advertising was one of the most effective strategies for improving advertiser market position and also ensuring revenue growth for the website. Unlike other competition that simply has pay-per-click pricing structures, Facebook allows the user, to some degree, to determine the advertiser exposure and future pricing models. When users of the site click on an ad, it generates an automatic count that tells Facebook how many users have looked at the ad or posted comments about its concept. This information is stored in a database and allows the company to determine which ads should have the most exposure based on volume. More effective ads receive more visibility, thus the advertiser needs to generate concepts for submission that are going to be relevant to language profiles, lifestyle, and interests to ensure more user click counts. In this case, it would not only be the high cash flow companies that could gain more exposure at low cost, it would be the more creative and lifestyle-relevant advertisers that could achieve low cost promotions and ensure more mass market (or niche market depending on strategy) attention. This is a source of extreme competitive advantage from the traditional banner ads hosted by many companies in multiple industries. Facebook provides for a budget-conscious forum for promotion and also does not introduce bias or a strict reliance on high pricing models to make the site attractive to multiple advertisers in many different industries and markets. In marketing theory, brand attachment is the period in which a user is more willing to invest their time in networking with a brand and is willing to begin defending the quality or integrity of their favorite products and services. Facebook provides the medium for this phenomenon, which also makes the site attractive to advertisers. Users on Facebook Beacon will often provide their experiences and purchase frequency with certain products which is then publicized on the site. This gives advertisers tangible quantitative data about sales preferences and frequency, which can then be applied to construction of future advertisements with this feedback in mind. Even though there were some legal complications with privacy concerns, the concept allowed advertisers to track the success of their marketing in a low-cost environment without having to devote a great deal of capital for tracking in their own product databases. In a sense, the tracking function of advertising and purchasing with consumer friends in the network was a form of cloud computing for budget recognition and effective statistical monitoring, evaluation and advertising control. EVALUATION OF THE SUCCESS OF FACEBOOK FAN PAGES The concept of Fan Pages has a great deal of psycho-social appeal for the user on the site and also revenue-building promise for many different marketers. Fan Pages allow for positive emotional sustainability when users witness that they have made fans through their discussions, photos, and other lifestyle interests and opinion. It fulfills, again, the basic psychological needs for social belonging and self-esteem development especially for younger users with disposable income available for expenditure on Facebook. For the business, fan pages allow for a particular product to be linked with someone who has developed brand attachment or loyalty. The inter-linking capabilities of Facebook allow the advertiser to then recognize the different friends of users that have signed up as friends, thus delivering the friends advertisements which indicate a message of “John Doe likes the McDonald’s Big Mac”. Most companies understand the social connotations of advertising and the concept of aspirational reference groups by which many in society mold their attitudes and behaviors. By allowing the businesses to send these customized messages, it appeals to their social needs for peer belonging and acceptance to make the product seem more appealing to the friend of the fan who signed up as a fan on the company page. It is an effective way to use psychographic targeting to gain new market attention and also provides users with more positive fulfillment by recognizing that they have made a positive impact on the Facebook community both local or international. Though there was some concern about the effectiveness of linking friends to Fan Pages, there simply was not enough tangible evidence that Fan Pages would be without merit to the marketers. The complex dimensions of reference groups is a widely understood phenomenon in both entrepreneurship and marketing theory and certain target groups strongly trust and rely on peer opinion when they are moving through the product purchasing decision-making model. Letting friends of various product fans know that people in their networks have product preferences, it is likely to create a desire to conduct more research on the brand or familiarize themselves with it as a topic of discussion and social commonality. The Facebook Fan pages are an excellent concept that not only fits the market orientation of the website, but the ability to provide advertisers with greater visibility without having to spend high capital resources for national ad campaigns. The Fan Pages facilitate market growth and also human needs fulfillment. EVALUATING THE PLATFORM AND FACEBOOK FOR WEBSITES The platform on Facebook is highly successful. The website allows for independent gaming developers to create applications on the site, which represents a low-cost methodology of not only research and development, but also distribution and visibility. Independent gaming developers, as one example, who would not normally have the funding to distribute their innovations can now have a great deal of promotion. Successful games with a great deal of user usage can build a reputation, gain attention from larger companies that need qualified and innovative gaming developers, and also establish brand followership internationally and domestically. The platform for gaming applications is a career development medium and also makes the site more attractive to users of different demographics which is highly beneficial for Facebook revenue production in the long-term. However, Facebook did not seem to have an evaluation or control system in place to screen out certain applications, thus the site was receiving some applications that were not relevant or were considered time-wasting and ridiculous. In some dimension, having such applications on the site maintains the ability to erode Facebook’s brand equity when consumers find poor applications on the site and link this to Facebook’s reputation. A more stringent quality control system geared toward removing or disallowing certain applications not relevant for improving user recreation needs or improving time on the site would have created a better branding strategy for Facebook. Despite this lack of quality screening, the platform still provided opportunities for small-time developers to network with various demographics to give their businesses or innovations much more exposure. This is justified by sudden growth in user traffic on the site, a third of total growth in 2007, and also time spent on the site before clicking off. These are very good growth statistics that are attributed to more interactivity on the site through application development and launch contracts. The ability of users to log into Facebook on third-party websites was an excellent marketing strategy for the company. Users that highly value the importance of connecting socially with friends could visit third-party websites and easily identify and locate comments left by their Facebook friends. This inter-linkage allowed hard-core Facebook fans to stay in touch with activities of their Facebook friends and fans offline, which was an excellent move by the company to improve its brand reputation. Rather than having to exit a third-party website, such as a restaurant page, they could post comments that would be routed to Facebook for reviews, opinions, or referrals. Being connected to Facebook without actually having to visit Facebook provided for more convenience and opportunities for a better focus on effective place promotion in the marketing mix. Facebook was no longer restricted to its own host location, but could be found virtually everywhere in the virtual community. The statistical data provided to companies that agreed to host Facebook capabilities also gained valuable market information about consumers, including their genders, lifestyles, hobbies, locations and important concepts for improving segmentation and target market promotions. This information, when provided, gives companies knowledge about the types of advertising that might be most effective toward these users that use the third-party log-in capabilities to improve their own market visibility and brand relevance with many key target demographics. After launching this third-party capability, many different sites hosting the Facebook log-in options or cross-functional posting capabilities found more increased registration on their own company websites which means more market transparency and the ability to be more interactive with their desired target customers. It was a significant revenue builder for Facebook and also for the companies agreeing to participate in the cross-functional concept. It should be considered a substantial success especially since it improved security on Facebook that has broader applications for user brand loyalty and attachment to this virtual organization. Read More