Facebook Value ChainSWOT

Pages: 9 (2871 words)   |  Style: n/a  |  Bibliography Sources: 6

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[. . .] Given that, Facebook has both its potential angles covered as people can share stories or items or whatever else whether or not there is Facebook integration on the site in question.

Weaknesses of Facebook include the fact that many users seem to think that Facebook has a burden to protect users from their own insipid and foolish behavior. Some immediate examples that come to mind are the aforementioned story about the National Labor Relations Board "protecting" people from having their own social media posts and activity used against them. While some may view the practice of screening social media to find out information or locate people is an invasion of privacy is macabre or illegal, it still remains that most situations like this involve a person either ignorantly or intentionally making those details visible. To suggest that Facebook is responsible for that is quite interesting (not to mention facetious) but many advocates and talking heads seem to think otherwise. As such, this is a weakness in the industry and in culture that Facebook will have to deal with even though the really should not have to do so. After all, it is not as if someone's computer was hacked or something but yet Facebook is getting assailed nonetheless.

However, another weakness that Facebook has, and something they have a much higher responsibility for, is their online security practices. Hackers and other nefarious people in the Internet, and indeed around the world, try to hack websites and user accounts every day. To that end, Facebook is actually quite good as they log what devices people log in from and they shut down accounts that come from questionable sources. There can be a number of false positives when doing this but most of those can be worked around. For example, if someone uses a personal VPN, Facebook might get a little iffy because the IP address of the VPN will be from a source other than what is expected based on prior logins. While this may frustrate users, it actually makes a lot of sense. This is a net weakness in that Facebook is in a "damned if they do, damned if they do not" situation. They have to deal with massive hacking attempts and threats but they are assailed when they implement security measures. On the other hand, the annoying users that do not want those measures in place probably would not be so mad at Facebook about that if their account were to be compromised. In the end, Facebook has to fight the good fight and they have to do what brings the best benefit and most compliance for the users and their company, respectively. However, doing just that is still going to make them targets in the long run as there are some people that can never be satiated and/or have unrealistic (or uninformed) opinions about "how things should be" for them and/or others.

Facebook has a massive amount of capabilities and resources available to them. They have a customer base around the world that is north of a billion users. At least rough count, there were nearly 1.2 billion active users. This is absolutely not bad considering that they are not much more than ten years old. For Facebook to be where they are despite the fact that there are roughly 400 online social networking sites in existence is staggering. Their resources, capabilities and core competencies include the ability to connect the world together, the ability to collect and generate enough advertising and mobile application/game revenue to support the site by itself with no fees paid by standard users, an online network of servers and connections around the world that most companies do not even come close to and so forth. Indeed, their one major core competency is to connect people and the internet into a single clearinghouse that is also connected to the other widely used sites around the world like the aforementioned ESPN portal (Lakshminarasimha, 2008).

Indeed, it has been held for most of a century that the core value chain commitment and facet of any social networking site, as stated by Karp in 2007, is to connect and facilitate communication with people (Lakshminarasimha, 2008). Perhaps the reason that Myspace faltered was that social media used to be the bastion of mainly to mostly teenagers and just about no one else. However, Facebook came to prominence during a time where it was realized that social media had usability and applicability with all age groups and that commerce and social media could become inextricably linked. While Facebook itself was initially limited to Harvard students and later was mostly populated only by college students, they recognized the possibilities beyond the college mob and reacted accordingly in subsequent years (Lakshminarasimha, 2008).

Through the value chain mentioned above, Facebook uses patterns, preferences, communication and adoption trends to drive their revenue cycle. This is the sort of data and information that marketing people froth over because it gives a direct indication of who is using the product and what they are interested in. Facebook having this data and Facebook willing to share this data (for a price) as well as partnering with small to large businesses that wish to user Facebook-driven ads on their own sites, and Facebook has a seemingly limitless pool of businesses sand people to which to sell to or at least market goods and services, both internal and external to Facebook (Lakshminarasimha, 2008).

Value chain experts hold that there are four basic purposes to the value chain. Those are to identify business activities, to identify inter-relationship between different activities, to choose business' competitive positioning and to identify alternative value chain delivery systems. Facebook has engaged in all of these to one degree and they have literally engaged in of facilitated all three major forms of commerce, those being business to consumer, business to business, and consumer to consumer. Much like other internet giants like eBay, Amazon and others, Facebook is welcoming the diversification that allows users and other businesses to share in Facebook's largesse rather than close off people and businesses to try and keep the revenue to themselves. Indeed, while Facebook is fulfilling the goals and desired outcomes of their value chain, other firms are able to partner with and/or buy from Facebook in a way that allows them to prosper in their own ways. It is not that different from when Amazon partners with sellers external to their firm to sell goods under the "Prime" banner or third party sellers selling their new or used goods through the Amazon marketplace (Lakshminarasimha, 2008).

Conclusion

Facebook is uniquely and dominantly positioned due to their foresight and greatly expanded partnerships. While there is danger in a company becoming too big, and this can come from outside or from within, Facebook seems to be on the right track. So long as they continue to evolve as needed and expand, there is little to no chance that they will have problems. However, Facebook should be mindful of current or former giants like Blockbuster Video, Wal-Mart or McDonald's in that it has (or is becoming) clear that there are new trends for the future and refusing to embrace them can be fatal.

References

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Died in a Car Crash. International Business Times.

Lakshminarasimha, A.A., & Vijayan, A. (2008). Value Chain Analysis: Social

Networking Communities. ICFAI Journal Of Marketing Management, 7(3), 34-42.

Lieberman, J.D., Koetzle, D., & Sakiyama, M. (2013). Police departments' use of Facebook: Patterns and policy issues. Police Quarterly, 16(4), 438-462.

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NCU. (2014, October 22). new.edu | BA486: Business Policy. new.edu… [END OF PREVIEW]

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