Posts
As we discussed in class a business concept simply describes the business, brand or product. Most business concepts include some of the following information: markets served, competitive advantages and/or unique features. For example, PayPal's is an online business that allows secure payments and money transfers to be made through the Internet. Click on the image on the left to learn more about new concept cell phones!
Next we are on to a pretty important topic--business models. Specifically we will focus on digital commerce and/or web-based business models. My favorite Internet Encyclopedia says, "In the most basic sense, a business model is the method of doing business by which a company can sustain itself -- that is, generate revenue. The business model spells-out how a company makes money by specifying where it is positioned in the value chain." Read more...
I'm sure you'll agree that revenue and sustainability are as important as anything, so I found some great resources for you. Please refer to Week 2 readings and videos, they are all excellent and to the point. Before I go, tell me this...
What is Facebook's business model?
12 comments:
I believe YouTube and Facebook both receive revenue from corporate sponsors and ads revenue. They both reach a large amount of people and companies know that they have involved these websites to fulfill their advertising and marketing needs, paying for available column and page space for ads. I also know that both sites receives donations from a lot of its users.
Cesar, I think you got some of it, but if I'm reading your post correctly, they basically have the same business model? Let's see what everyone else thinks.
I think that both websites have similar models. Facebook has to compete with other social networking sites, so they have created one of the easiest sites to use. Even for people who don't know computers very well, Facebook gives people features of other social networking sites without too much tech stuff. Because of this, they get a lot of users. Once there are a lot of users in one place, they can generate revenue from ads.
Youtube is also easy for anyone to use and has almost no interference with ads-- unlike other video sites. They can generate revenue from ads or from sponsoring a video.
Either way, both have been able to attract people and ads from their ease of use.
Both Facebook and Youtube have created the most user-friendly sites in their respective field. Both have ads on their website, but are much less intrusive than other websites. While facebook and youtube have separate business models, these two characteristics are essential to each model.
Facebooks business model is establishing an online social network service that is not cluttered and easy to use. They compete by offering services that are geared to a populous focusing on college and high school. They earn money by using subtle advertisements that are geared to your interests. Its value is determined by how users interact with others, and the ease of communicating through wall posts, messages and applications.
You Tube is also on the social networking, however they took advantage of a specific area of video. Facebook and Myspace concentrate on wall posts and applications while you tube is about posting videos. YouTube uses its resources on the internet to allow users to upload and watch videos. They have a lot less competition,and earn profits the same way facebook does buy advertisments.
As mentioned they are both very user friendly sites in which you can control how much interaction you want with other members. Facebook's value to its customers started with exclusivity, socialization and personalization. Users were college kids thus allowing Facebook a unique opportunity from a marketing persepective-a very specific audience in terms of demographics and psychographics-through profile information (likes, dislikes,intrests,groups and etc.)
YouTube was valuable because it served as a place where users could rate the content as well as control what was posted. For many it was a way to digitally voice your opinions and discuss a wide range of topics. Again, marketing managers had free access to this information and could gain insight without necessarily having to ask for it. Now it has served as a place for large companies to reach out to their consumers and provide them with the content they want.
The social utility created by Facebook and YouTube have pulled in its users at an unprecedented rate. And the "social" aspect and the content they post is exactly what people in marketing are looking for. However the way in which the companies interact is unobtrusive so the users don't mind.
Here is my take on there on their business models, though similar to what has been posted I think it still ads to the discussion.
Facebook started with the idea of social networking and from its success a business model was developed. This business model is advertising to an audience based on specific interest. So far Facebook addressed this through small simple ads along the right hand side of the screen. I feel that they have the opportunity to expand upon this and capitalize on the wealth of knowledge its users provide. However in this position they have to be careful where they take this as advertising that become too intrusive could take away from their user friendly appeal.
Youtube has a very similar business model in the sense they generate revenue from advertisements. They have developed a wed based video social networking site that from its popularity has been able to sustain itself through advertising revenue. Similar to Facebook they have to present these advertisements in an effective manner that does not take away from the simplicity of their site that has brought its popularity.
It is clear that both Facebook and Youtube are a social networking and branding sites that allows its users to promote themselves. Youtube can create users who upload material of not just their own work and personal presence additionally.
Both models fall in a few different areas. Both Facebook and Youtube generate revenue and value through advertising models. On Facebook, classifieds, user-registration, and feed banner ads all provide for its sustainability. There is no video component to online advertisements on facebook at the current moment.
Youtube follows an advertising model as well by generating user profiles who use behavioral marketing in addition to content-targeted advertising to generate ad revenues to specific pages within the network. Something that youtube has pursued additionally is in a beefed up community model compared to facebooks in the social networking aspects.
Essentially, both business models are very similar.
It is clear that both Facebook and Youtube are a social networking and branding sites that allows its users to promote themselves. Youtube can create users who upload material of not just their own work and personal presence additionally.
Both models fall in a few different areas. Both Facebook and Youtube generate revenue and value through advertising models. On Facebook, classifieds, user-registration, and feed banner ads all provide for its sustainability. There is no video component to online advertisements on facebook at the current moment.
Youtube follows an advertising model as well by generating user profiles who use behavioral marketing in addition to content-targeted advertising to generate ad revenues to specific pages within the network. Something that youtube has pursued additionally is in a beefed up community model compared to facebooks in the social networking aspects.
Essentially, both business models are very similar.
It is fair to say that Facebook is a "killer app". Facebook probably did not have a business model and its birth. Over the past few years of its existence, their business model has changed. Currently, facebook's primary revenue driver is the social ads that are posted which acts as a monetary tool. The more users facebook has results to more traffic. And the more traffic results to the ability to increase ad rates. However, there really is no clear track to profitability of facebook according to what I've read. Zuckerberg says he is still looking for a business model which means to find a way to make way more money than they spend. At least they aren't hurting in the user count with over 100 million. With that large a user network, the sky is the limit with what they can do in terms of porfitablity and their business model.
On the other hand, Youtube is a different story. It has been an issue of Youtube as to how they would manage to monteize their traffic, which is vast. Their business model is a bit more simple and developed than Facebook's. It is to
I understand Facebook's business model to be a medium of advertising for other companies. Yes it is a Social Network Service, however its method of sustaining itself is by providing a large range of individuals to market to via internet traffic. Not only are there a lot of people to be reached, but because of the "personalized" aspect of facebook, companies can do targeted marketing to users.
Youtube also shares a similar business model of being a medium of advertising for other companies. It too is a Social Networking site, however through videos O.o the interesting twist. By providing a method for user to express themselves through media, Youtube has created a high traffic area on the web for advertisers to use for marketing purposes.
The business models (as mentioned above) appear to be very similar for Facebook and Youtube, both are social networking sites that sponser advertisements, which in turn provide sustainability. Despite their differences they are both sites which are equally personalized, which allows for the advertisements to be specifically catered to a particular demographic and even a specific individual. Facebooks specifications are largely due to the profile and information entered by the user, as well as the interests and applications that the user chooses. Youtube simply by the specific videos that individuals choose to watch and/or create and post, provide information about their interests and the specific products which could easily be marketed to them. Thus this use of frequently visited social sites to reach particular demographics and market individualized products, in turn provide the monetary resources to maintain and grow the site itself.
Post a Comment