Table of Contents

I. INTRODUCTION..................................................................................................................3
1. Founded:.......................................................................................................................................................3
2. Facebook app:...............................................................................................................................................3
3. Achievements:..............................................................................................................................................3
4. Basic principles of Facebook culture:...........................................................................................................6
II. OBJECTIVES........................................................................................................................7
III. BUSINESS ANALYSIS:........................................................................................................7
1.SWOT analysis..............................................................................................................................................7
1.1,Strength:...............................................................................................................8
1.2, Weakness:...........................................................................................................9
1,3. Oppoturnities:...................................................................................................10
1,4. Threats:.............................................................................................................10
2. Five Forces analysis....................................................................................................................................11
2.1, Competitive Rivalry or Competition with Facebook Inc. (Moderate Force):....11
2.2, Bargaining Power of Facebook’s Customers/Buyers (Strong Force):...............11
2.3, Bargaining Power of Facebook’s Suppliers (Weak Force):...............................11
2.4, Threat of Substitutes or Substitution (Strong Force):........................................12
2.5, Threat of New Entrants or New Entry against Facebook Inc. (Weak Force):....12
3. PESTLE analysis........................................................................................................................................12
3.1, Political:............................................................................................................12
3.2, Economic:.........................................................................................................12
3.3, Social:...............................................................................................................13
3.4, Technology:......................................................................................................13
3.5, Legal:................................................................................................................13
3.6, Environment:....................................................................................................13
IV. BUSINESS STRATEGY.....................................................................................................14
1. Industry analysis.........................................................................................................................................14
1.1, Facebook:..........................................................................................................14
1.2, Twitter:.............................................................................................................14
2. Resources and Capability analysis..............................................................................................................15
2.1, Global Presence:...............................................................................................15
2.2, Large Audience size:.........................................................................................15
2.3, Technological innovation:.................................................................................15
2.4, Complementary product range:.........................................................................16
2.5, Organizational Culture & HRM:.......................................................................16
3. Business-level strategy................................................................................................................................16
3.1, Marketing-mix strategy:....................................................................................16
 3.1.1, Products of Facebook:...................................................................................................................16
3.1.2, Price and pricing strategies of Facebook:......................................................................................17
3.1.3, Place/distribution channels of Facebook:......................................................................................17
3.1.4, Promotional strategies of Facebook..............................................................................................17
3.1.5, People of Facebook:......................................................................................................................18
3.1.6, Process in Facebook......................................................................................................................18
3.2,Facebook’s cost leadership Strategy:.........................................................................18
3.3,Facebook’s Intensive Strategies (Intensive Growth Strategies):.................................19
3.3.1 Facebook’s target audience.............................................................................20
3.3.2, Central Pillars of Facebook’s Business Growth Strategy:..............................21
3.4 Conclusion:................................................................................................................23
V. OTHER ISSUES..................................................................................................................24
VI. References.............................................................................................................................24

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I. INTRODUCTION
1. Founded:
-Facebook, a social networking website started by the company Meta Platforms.
Facebook was founded in 2004 by Mark Zuckerberg, Eduardo Saverin, Dustin
Moskovitz, and Chris Hughes, all of whom were attending Harvard University. By the
year 2021, Facebook had become the largest social network in the world. The company's
headquarters are located in Menlo Park, California.
-The company has a complicated history that begins early on. Facemash was started at
Harvard University in 2003 and is an online service for students to judge the
attractiveness of their fellow students. Because the primary developer, Zuckerberg,
violated the policy of the university in acquiring resources for the service, it was shut
down after two days. Despite his fly-like existence, 450 people (who voted 22,000 times)
flocked to Facemash. When Mark Zuckerberg created the Facebook in 2004, it was
successful, which prompted him to register the web address http://www.thefacebook.com.
- Myspace was the most popular social networking site at the time, and News Corp.
bought it for over $600 million in 2005. Facebook behind Myspace in both funding and
users for several years, but it was able to stay afloat because to cash infusions from
Microsoft, Yahoo, and a Russian investment firm. Mark Zuckerberg made a brilliant
move in 2008 when he persuaded Sheryl Sandberg, Google's vice president of worldwide
online sales and operations at the time, to leave Google and join Facebook as the
company's new second in command.
2. Facebook app:
- People use Facebook to share what's important to them and to learn about what's
happening in the world. They can learn about new things, share their passions, and
support the businesses they care about. With Facebook business Pages, posts, events, and
more, businesses can create connections, achieve their goals, and tell their stories on any
device. Businesses may use Facebook to find and engage with new audiences, develop
relationships, and convert leads into consumers.
-As Facebook has evolved, the company have launched apps like Instagram, Messenger,
and WhatsApp to help companies expand their online presence and connect with people
as they discover and share ideas. Businesses may utilize these tools to expand, stay
connected with customers, tell their stories, and keep their communities up to speed on
their products and services.

3. Achievements:

 2004:
-Facebook (then called "thefacebook") was founded by students Zuckerberg,
Moskovitz, Saverin, and Hughes.

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 -Facebook spreads to three other college campuses - Yale, Columbia, and
Stanford.
-Facebook moves its headquarters to Palo Alto, California.
-The site launches the now-infamous "wall" - which allows users to post things
and receive messages on their own page.
-Facebook hits 1 million users.
 2005:
-The site expands to high school networks. It also drops the "the" to become just
"Facebook."
- Facebook adds photos and goes international.
- Facebook has more than 6 million users.
 2006:
- Facebook goes mobile.
- Anyone can now join Facebook.
- Membership increases to 12 million.
 2007:
- Video capability launches.
- Membership increases to 58 million.
 2008: Launch of Facebook for iPhone.
 2009: The "like" button is introduced.
 2010:
- Over 500 million users are active on Facebook.
- A Facebook engineering center is opened in Seattle.
- Groups are launched.
 2011:
- Datacenter opens in Prineville, Oregon.
- Video calling is launched.
 2012:
- Acquisition of Instagram is announced.
- Facebook releases its IPO - which raised $16 billion and gave the company a
$102.4 billion market value for its Facebook stock.
- Membership hits the 1 billion mark.
 2013:
- Acquisition of Atlas is announced.
- Facebook's acquisition, Instagram, launches video capability.
 2014:
- Acquisition of WhatsApp is announced.
- Acquisition of Oculus is announced.
- Facebook's Business Manager service is launched.
- Groups App is announced.
 2015:
- Over 40 million small business pages are now on Facebook.
- Facebook's AI Research group opens in Paris.
 2016:

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 - Facebook's Reactions launches.
- There are now more than 1 billion users of Messenger a month.
- Facebook Marketplace launches - allowing users to buy and sell products.
 2017:
- F8 developer's conference is held in San Jose by Facebook.
- News emerges that Facebook, and Microsoft, have completed work on a new
trans-Atlantic data cable.
 2018:
- Facebook is sued by shareholders, following stock plummet.
- Facebook trial a new technology to help stop "revenge porn," by asking users to
provide naked pictures of themselves.
- Zuckerberg testifies before Congress regarding concerns over data and privacy
breaches.
- Facebook COO Sheryl Sandberg testifies before Congress.
- Facebook announces the launch of the new Facebook Portal: a hands-free video
calling device.
- Facebook announced the launch of "Stablecoin", a blockchain version in India.
 2019:
- Facebook invest $7.5 million to help launch a TUM Institute for Ethics in
Artificial Intelligence.
- Facebook reportedly set aside billions to cover potential future FTC fines.
- Facebook deletes large amounts of fake accounts from its site.
- Facebook shareholders vote to remove Zuckerberg as Facebook chairman. 68%
agree with the motion.
- Facebook begins blocking Huawei from pre-installing its app on their smart
devices.
- Facebook launches its news digital wallet and currency called Calibra.
- It is announced that Facebook is helping to map roads using deep learning and
AI-focussed tools.
- Facebook file lawsuits against various Hong Kong and Singapore app developers
because of their so-called "click injection" fraudulent activities.
- Facebook launch their Tinder-like dating feature, that also comes with Instagram
integration.
- Facebook acquire the mind-reading startup CTRL-labs for $1 billion.
- Facebook announces yet another major security breach.
 2020:
- Facebook announces the cancellation of all major public events until 2021 amid
COVID-19 fears.
- Facebook purchases GIPHY for hundreds of millions of dollars.
- Facebook unveil their new AI tool to transform 2D images into 3D models.
- Companies begin to pull ads from Facebook in a boycott over "hate speech".
Facebook stock takes a massive hit.
- The company announces its new "Dark Mode" for mobile devices.

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  2021: Facebook announced that it was changing the name of its parent company to
Meta Platforms.
4. Basic principles of Facebook culture:
- Freedom to share and connect: You have complete freedom to distribute any
information you desire, in any medium or format. You have the right to communicate
with anyone — any person, organization, or service — over the internet as long as both of
you agree to the interaction. Keep in mind that Facebook users can customize their
privacy settings in a variety of ways. They, like you, expect their personal space to be
respected.
- Ownership and control of information: Because you own your data, you may share it
with whomever you want and take it wherever you want, including removing it from
Facebook at any time. You can secure those selections with your privacy controls.
- Fundamental equality: Regardless of another person's primary activity, you have
representation for and equal access to information on Facebook, whether you are an
individual, advertiser, developer, organization, or other entity.
- Social value: Through your identification and contacts, you have the freedom to develop
trust and reputation.
- Open platforms and standards: You have access to a programming platform that allows
you to share and access all of the information available on Facebook. The specifications
for these interfaces have been published and made freely available to the public.
- Fundamental service: You may create a free Facebook page to promote your business,
connect with people, and share information. Everyone, regardless of their level of
participation or contribution, can use Facebook.
- Common welfare: Facebook's and users' rights and obligations are outlined in a
Statement of Rights and Responsibilities, which are not in conflict with these principles.
- Transparent process: Facebook makes information about company mission, strategies,
rules, and operations publicly available. To encourage participation and dialogue on
revisions to these principles or the Rights and Responsibilities, Facebook includes a town
hall process of notice and discussion, as well as a vote method.
- One world: The Facebook service is accessible to anyone, everywhere with Internet
access, regardless of their location or nationality.

II. OBJECTIVES
-The original purpose of Facebook, or "The Facebook" as it was known then, was to
create a place where college students could connect to one another.Harvard students who
sign up for the service are able to post photographs of themselves and personal
information about their lives, such as their class schedules and clubs they belong to. Its
popularity increased, and soon prestigious schools, such as Yale and Stanford
universities, were allowed to join. By June 2004 more than 250,000 students from 34

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schools had signed up, and by the same year major corporations such as the credit card
company MasterCard started paying for exposure on the site.
- Facebook's mission is to give people the power to build community and bring the world
closer together. People use Facebook to stay connected with friends and family, to
discover what's going on in the world, and to share and express what matters to them.

III. BUSINESS ANALYSIS:

1.SWOT analysis

STRENGTH WEAKNESS

- Strong brand - Problem of Facebook security

- Loyal customer base - Fake news
- Available in 111 languages - Overdependence on Advertising
- World’s best employers - Cyberbullying,online scam,...
- Focus on R&D

OPPORTUNITIES THREATS

- Increasing Integration to other - Bans in Several Countries

applications - Data Breach
- Offer Remote Work Solutions - Duplicate & False Accounts
- Develop Autonomous Vehicles

1.1,Strength:
- Facebook has built a brand image full of credibility and trust. It is essential for long-
term stability and sustainability. In 2019, Facebook was ranked #5 most valuable brand
by Forbes. With $88.9 billion in brand value, Facebook is the strongest brand in the social
media industry globally.Not only focusing on Facebook, the company has developed
many other platforms such as: Instagram,Messenger,Whatsapp,... This has increased the
stability and solidity of the company. Not only that, companies which dominate the
market can leverage their elevated positions to their advantage. The leading social
network of the world, Facebook and its family products (Instagram, WhatsApp,
Messenger), have Monthly Active People (MAP) value of 2.89 billion (Dec 31, 2019).
This makes Facebook more reputable and turns it into an advantage of Facebook.

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- Facebook Company is an in the public company network the most multilingual social
network. They have up to 111 languages with global coverage for everyone. Along with
their reputation building,that has helped them to have a loyal and growing customer base.
About 40% of the world population uses Facebook and its family products (Instagram,
WhatsApp, Messenger), putting Facebook in an irreplaceable position.
- Facebook’s excellent HR policies are regarded as one of the best not only in the social
media industry but also globally across all other industries, they create a comfortable
working environment to help employees develop all skills..It is known to attract and
retain top talent in the industry. Forbes ranked Facebook in the following categories:
 #147 Best Employers for Diversity 2020,
 #144 World’s Best Employers 2019, and
 #71 America’s Best Employers 2019
- Regardless of the industry, success in the digital age requires technological innovation
through research and development. Facebook is one of the global leaders in R&D
spending and has increased investment in R&D from $4.8 Billion in 2015 to $13.6 Billion
in 2019, which is about 19% of its annual revenue.
1.2, Weakness:
- Facebook is receiving backlash for its failure to protect users' privacy, and the firm is
losing popularity in some parts of the world. If the company does not immediately and

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effectively handle users' privacy concerns, it risks losing its popularity. Facebook has lost
roughly 15 million users since 2017, according to Edison Research research.

- Facebook does not have policies and laws to control unofficial news sources, false
articles that has a lot of impact on users, society. People don't know what is fake news
like we have experienced in the recent Covid-19 pandemic.
- The financial model of Facebook is mainly reliant on advertising. Advertising accounts
for 98.5 percent of its annual revenue. The company's advertising revenue was $69.66
billion in 2019, out of a total revenue of $70.70 billion.
- There are many problems happening on Facebook such as: cyberbullying, online scam,
racism,... Facebook still has not controlled those problems. They should put in place
disciplinary policies for violators.
1,3. Oppoturnities:
- As technology improves, more applications and websites become integrated, allowing
consumers to connect across several platforms. Facebook's platform might be opened up
to include e-commerce, surveys, blogs, podcasts, films, contests, reviews, and games,
among other things.
- Recent events have increased demand for remote work solutions. Facebook seeks to
exploit this opportunity and announced in July 2020 that it is expanding the features of its

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Messenger Rooms and Facebook Live to allow users to hold live video conferences with
up to 50 people at a time. These features will enable Facebook to compete with service
providers like Zoom,Microsoft,...
- Facebook has extensive expertise in artificial intelligence and can develop self-driving
software for manufacturers of autonomous vehicles. Rivals like Apple, Google, and
Amazon are already exploiting and benefiting from the self-driving car market. A few
years ago, Facebook’s COO Sheryl Sandberg attended the Frankfurt Motor Show and
created excitement about the company’s entry into the automotive sector.
1,4. Threats:
- Regulations are being implemented in democratic countries to combat fake news that is
exploited to undermine democracy, while autocratic governments are banning access to
Facebook to limit freedom of speech.Facebook, for instance, is prohibited in China, Iran,
and North Korea. Furthermore, Russia just imposed a ban on Facebook in the country.
- Facebook has been the victim of many data breaches that have affected millions of its
users. For example, following a significant data breach in December 2019, the personal
information of over 267 million Facebook users (names, user IDs, and phone numbers)
was exposed on the dark web.
- According to Facebook, 11 percent of its 2.5 billion Monthly Active Users (MAU)
worldwide (as of December 2019) are duplicate accounts, while 5% are fraudulent
accounts. The Philippines, Vietnam, and Indonesia account for the majority of duplicate
and fake accounts.
2. Five Forces analysis
2.1, Competitive Rivalry or Competition with Facebook Inc. (Moderate Force):
Despite its dominant position in the social media business, Facebook Inc. faces
tremendous competition. Only a few companies provide online display advertising
services similar to those provided by Facebook Inc. YouTube LLC, for example, operates
a social media platform that provides customized internet advertising. Due to the tiny
number of competitors, Facebook faces a weak force. However, the diversity of these
businesses attracts advertising, resulting in a moderate force in the industry. Furthermore,
because of the cheap switching costs, advertisers are more likely to switch away from the
company and toward competitors. These external factors create the moderate force of
competition.
2.2, Bargaining Power of Facebook’s Customers/Buyers (Strong Force):
- Buyers can be a demanding bunch. They aim to get the greatest deal possible by paying
the least amount of money feasible. In the long run, this put a strain on Facebook, Inc.'s
profitability. The smaller and more strong Facebook, Inc.'s customer base is, the greater
the consumers' bargaining strength and capacity to seek growing discounts and offers.
- Facebook's members/users have access to social media services. Advertisers, on the
other hand, are the company's main source of revenue. These advertisers have the option
of using readily available substitutes. Customers might, for example, advertise on
television, radio, or print media instead of Facebook, all of which are widely available

9
and effective in reaching target audiences such a condition exerts a strong force against
the business, despite the social network’s strong popularity. Furthermore, low switching
costs are an external aspect that makes switching away from the company's social
networking website, mobile apps, and advertising services simple. This aspect has a
significant negative impact on the company. The huge demand for online advertising
dampens advertisers' potential shifts and diminishes customers' negotiating power
slightly.
2.3, Bargaining Power of Facebook’s Suppliers (Weak Force):
Almost every company in the Internet Information Providers market obtains its raw
materials from a variety of sources. Suppliers with a strong position in the market can
reduce the margins that Facebook, Inc. can make. Suppliers with clout in the technology
sector utilize their clout to extort higher costs from companies in the Internet Information
Providers business. Higher supplier bargaining power has the overall effect of reducing
Internet Information Providers' total profitability. However, by using appropriate supply
chain methods, the organization can improve its management of supplier relationships.
2.4, Threat of Substitutes or Substitution (Strong Force):
Substitutes could have a negative impact on Facebook's commercial performance and
pose issues in the social media company's industry. Advertisers may easily pay for
alternatives to Facebook's social media advertising, such as television, radio, and print
advertising, or Dropbox and Google Drive can be used to replace storage hardware
devices. This situation has a significant impact on the firm. In this regard, the widespread
availability of such substitutes has a significant impact on the industry's environment.
Nonetheless, many of these alternatives are more expensive than Facebook's advertising
options, particularly television advertising. Such cost condition exerts a moderate force
on the company
2.5, Threat of New Entrants or New Entry against Facebook Inc. (Weak Force):
Due to the low switching costs (low difficulty) of advertisers switching from one service
provider to another, new entrants exert a powerful influence against Facebook. This Five
Forces analysis, on the other hand, demonstrates how tough it is to build a popular and
trustworthy social media brand equivalent to Facebook's. It's also challenging to earn
marketers' and users'/members' loyalty. This external factor reduces the threat of new
competitors entering the market. New entrants are a minor issue in Facebook's strategic
formulation processes, according to this section of the Five Forces research.

3. PESTLE analysis
3.1, Political:
Political stability or instability, legal support for globalization (government support), and
any political impediments that prohibit Facebook from expanding into new markets are
all political issues that can influence the corporation (e.g. Asian). It is undeniable that
social media has the ability to support and disseminate various types of information,
thereby directly altering the political landscape of countries (e.g. the elections in the
USA, the series of terrorist attacks in Europe, etc.). Because any instability can interfere

10
with Facebook's function, the corporation is concerned in the political stability of
industrialized countries (Facebook is banned in North Korea). If a government supports
globalization, the company will easily expand and promote its products and services
towards the population (Horst and Miller 55).
3.2, Economic:
Stable economies in developed countries (offer opportunities), economic development in
developed countries, and rising incomes are the economic reasons. All of the
aforementioned characteristics present chances for the company: stable economies will
allow it to expand, and economic growth and rising earnings will enable people in
developed countries to purchase goods and services.
3.3, Social:
Social conditions have an impact on Facebook's popularity and global reach. People are
increasingly emphasizing high quality in the services they use as their financial capacity
and living conditions improve. This social condition presents an opportunity for
Facebook Inc. to improve its service quality standards in order to satisfy and retain clients
who pay for the company's display advertising services. Furthermore, as online shopping
becomes more popular around the world, Facebook will have more opportunity to offer
new services in order to profit from retail sales produced through its social networking
website and related mobile apps.
3.4, Technology:
Because Facebook Inc. is an online-based company, technology has an impact on the
company. Facebook has a chance to improve the user experience with its mobile apps.
This potential stems from the international trend of increased mobile device usage. More
online social networks, on the other hand, are attempting to entice consumers away from
the company's social media offerings. Market saturation is also a result of this
technological development. Furthermore, the diversification of online retail enterprises
poses a danger to the company's competitiveness. For example, through its network of
affiliate websites, Amazon.com is able to provide online advertising services.
3.5, Legal:
Laws impose restrictions and limitations on Facebook's operations. Facebook Inc. has the
option to create and release new goods while expecting legal protection as patent laws
improve around the world. For example, the corporation can grow its social media
presence in more locations around the world as a result of this external influence.
However, Facebook is subject to a ban in China, which makes it even more difficult for
the company to expand into other markets. Legal external considerations, on the whole,
present opportunity for Facebook Inc. to extend its activities and market reach.
3.6, Environment:
The natural environment plays a large part in Facebook's social media company. This
factor determines the consequences of environmental concerns and trends on the
company's remote or macro-environment. Facebook Inc. has the chance to improve the
sustainability of its social media business in order to address environmental issues. In
addition, the company's business operations can benefit from improved trash disposal

11
rules and regulations. The rising complexity of waste disposal requirements, particularly
in Western countries, can be addressed through such efforts. Climate change poses a
threat to Facebook, which may force the company to relocate its servers and other
infrastructure in the future.

IV. BUSINESS STRATEGY

1. Industry analysis
1.1, Facebook:
- On the earth, there are 7.6 billion people, and 2.5 billion of them use Facebook at least
once a month. With roughly a third of the world's population connected through a single
social network, who is Meta's target market? It is an understatement to suggest that
everyone is its target market. At the end of 2019, Facebook had 248 million monthly
active users in the United States and Canada. Approximately 68 percent of all adults in
the United States have a Facebook account. When it comes to demography, there are a
few minor distinctions. For example, 74 percent of adult females use Facebook, whereas
just 62 percent of adult males do. And, like with all social media, the platform is
increasingly popular among younger adults. Roughly 80% of 18- to 49-year-olds have an
account. But older Americans are still represented. In the 50 to 64 age group, 65% are on
Facebook, as are 41% of those 65 and older.
- Facebook members are not differentiated by their ethnicity. High school grads, as well
as those living in rural areas of the United States, are less likely to utilize the platform
than college graduates. However, Facebook is used by practically everyone who utilizes
social media as a medium of communication. Perhaps this is why Facebook's initial
public offering (IPO) was one of the most widely anticipated in financial history. It went
public in May 2012 at a $104 billion valuation, making it the third-largest IPO in the
United States at the time. Meta's main source of revenue is targeted digital advertising. It
made $70.7 billion in revenue in 2019, up from $55.84 billion the previous year.
However, earnings fell to $18.48 billion compared with $22.11 billion previously, as
costs and expenses rose. Mark Zuckerberg, the company's founder, chairman, and CEO,
is the largest shareholder. As of April 2019, he owned 12.17 million Class A shares and
365.72 million Class B shares. This gave him 53% of the company's voting power.
Following its public debut, Meta completed two big acquisitions. In 2012, it paid $1
billion in cash and stock to acquire Instagram. In 2014, Meta paid $19 billion for
WhatsApp, which has since grown in value to $22 billion thanks to a rise in Meta's stock
price.
1.2, Twitter:
Former President Donald Trump's followers could follow him on Twitter before he
was banned. The microblogging service provided Trump with direct access to the
platform's 31 million users. When he was banned on January 8, 2021, he had
approximately 88 million followers. About 24% of adults in the United States have a
Twitter account. Twitter users are virtually evenly split between males and women. Users
are younger, as they are on Facebook, with a disproportionate number of 18- to 24-year-
olds. 45 percent of people in this age range say they use Twitter. This contrasts to 33%

12
for those aged 25 to 29, 27 percent for those aged 30 to 49, and 19 percent for those aged
50 to 64. High school graduates are less likely to use Twitter compared to college
graduates. Its users also tend to be more affluent and live in a city. In November 2013,
Twitter went public, with a market capitalization of $25 billion on the first day of trading.
In 2019, it made $3.46 billion in revenue, up from $3.04 billion the year before. The
majority of money came from promoted tweets, with the rest coming from data licensing.
Jack Dorsey, a co-founder, CEO, and director of the firm, owns 18 million shares, or
2.34%.
2. Resources and Capability analysis
2.1, Global Presence:
Facebook has a global audience, and its audience in emerging economies has risen in
recent years, resulting in stronger revenue growth. Its global accessibility is a major
source of competitive advantage, attracting marketers to the platform for product and
service marketing and promotion. Marketers can use Facebook to market their products to
a worldwide audience and target buyers from all over the world. As a result, Facebook's
powers in terms of reach are unrivaled. Every day, millions of people use computers or
internet-enabled mobile devices to access the platform.
2.2, Large Audience size:
In recent years, Facebook's global viewership has grown significantly, and the firm has
witnessed a tremendous increase in users from the Asia Pacific region. Facebook has a
monthly active user base of more than 2.5 billion people. Whether you're seeking to reach
a tiny market segment or a worldwide audience with your online business, Facebook has
unrivaled reach. The social media network's vast audience size is a significant source of
competitive advantage for the company, and many brands and marketers flock to the
platform to promote their products and services in front of a global audience.
2.3, Technological innovation:
Because competition has become increasingly fierce, and continual investment in R&D is
necessary to grow the degree of user engagement, digital giants like Facebook and its
competitors rely substantially on research and development. If Facebook has seen a
significant increase in revenue, this can be credited in part to the increased user
engagement it has obtained as a result of improvements to various services and features.
The tech behemoth places a premium on the customer experience. It is, however,
investing in technological innovation in order to increase the rate of return for advertisers
that purchase Facebook ad places. Several of these new Facebook competitors have arisen
from unexpected places. Facebook is seeing significant competition from streaming
services like Netflix and Hulu, as well as gaming services, in addition to other social
media outlets like YouTube and Twitter. As a result, the company has placed a greater
emphasis on research and development in order to increase the appeal of its product
offering.
2.4, Complementary product range:
Facebook's product line includes more than just Facebook; the firm has grown its product
line through acquisitions. Instagram, WhatsApp, and Oculus have all been added to the

13
company's product line as a result of acquisitions. While Facebook advertising is
presently its main source of money, and revenue from other sources is negligible, the
company's other products have helped it build its popularity and brand awareness
worldwide.
2.5, Organizational Culture & HRM:
Facebook is an innovative technology company. However, since its initial days, the
company is also known for its extraordinary focus on human resource management and
organizational culture. Apart from competitive compensation, the company also uses a
wide range of nonfinancial measures aimed to drive higher staff motivation, grow
retention rate and attract talented people to the organization. Innovative HR management
at Facebook has led to higher staff satisfaction and employee engagement which are both
great for driving improved performance and higher productivity among the employees.
3. Business-level strategy
3.1, Marketing-mix strategy:
Marketing is also a critical pillar of Facebook’s business strategy. While the company
gained strong brand recognition just a few years after its foundation, it could not achieve
faster growth without investing in marketing. Facebook has focused on strengthening its
brand recognition and gaining user loyalty by focusing on superior customer experience.
However, apart from these things, it also invests in digital advertising and promotions and
other brand-building activities. To drive the user acquisition rates higher, the company
invests in digital ads. In just the last three years, the company has nearly doubled its
expenses on marketing and sales. Its marketing and sales expenses were $4.7 billion in
2017, which grew to $7.8 billion in 2018 and then $9.9 billion in 2019. And Facebook
has used the marketing-mix strategy extremely effectively. Now I will analyze the
marketing-mix strategy of facebook
3.1.1, Products of Facebook:
It goes without saying that Facebook is in service industry, and as a service it is a brand
name itself. The mission of the company is to ‘give people the power to build community
and bring the world closer together’ (Facebook, 2021). The handy connectivity of
Facebook allows users to connect with friends, family members, relatives, colleagues,
acquaintances etc. whenever they want. People not only write, but also share photos, and
videos on it that enhances connectivity and communication.
Facebook has made a number of acquisitions over the years. As a result, its main products
are Facebook itself, Instagram, Messenger, WhatsApp, and Oculus. Messenger and
WhatsApp are instant messaging services, while Oculus is a virtual reality technology
business. Both Facebook and Instagram are social networking services. It is worth
mentioning that advertising is the main source of Facebook’s revenue. It is also worth
mentioning that Facebook has been criticised for using WhatsApp data.
3.1.2, Price and pricing strategies of Facebook:
Pricing is an extremely important factor in building and maintaining customer
relationship. Therefore, it is not surprising as to why opening both a personal account and
a business account on Facebook is free. Of course, Facebook is a profit-making company

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and therefore profits must come from somewhere. As mentioned above, the main source
of Facebook revenue is advertisement.
Advertisers have different options to choose to advertise through Facebook. For instance,
a post or a page can be promoted with as little as $2.00. Likewise, if someone decides to
advertise on Facebook based on CPC (cost per click), the average cost per click across all
industries is $1.72. On the other hand, the average cost per action (CPA) across all
industries is $18.68 (Irvine, 2020). This shows that Facebook generates mind-blowing
amount of money from ad campaigns run by people and organisations from around the
world.
3.1.3, Place/distribution channels of Facebook:
Though Facebook started its journey in a room of Harvard University in 2004, it is now
available virtually everywhere in the world. However, its access was restricted for both
short and long periods in countries such as China, North Korea, Iran, and some others.
Users can access their Facebook accounts from devices such as computers, tablets, and
smart phones with the Internet connectivity. Social networking service of Facebook is
available on mobile apps and on its websites such as Facebook and Instagram.
Advertisers can use these websites for their advertising campaigns.
3.1.4, Promotional strategies of Facebook
While Facebook is a tech company, it has used word of mouth (one of the oldest methods
of promotion) very effectively. Users have taken the brand name from one part of the
world to another through their words of mouth. This word-of-mouth campaign has gone
viral and immensely contributed to the development of the brand Facebook.
In addition to word of mouth, Facebook also uses many other methods of promotion. For
instance, it directly recommends advertising campaigns to Facebook business page
owners. It also uses TV, billboards, newspapers, and many other traditional methods of
advertising in some countries to take its name to its target audience. For instance,
Facebook plays ads on Indian television and runs them on newspapers as well. It also
advertises on prominent billboards across some cities in India (Mitter, 2018)
3.1.5, People of Facebook:
Mark Zuckerberg, Dustin Moskovitz, Chris Hughes and Eduardo Saverin are the founders
of Facebook. Mark Zuckerberg is the current Chairman and Chief Executive Officer of
the company.
The total number of people employed by Facebook is around 45,000. Interestingly, only
150 people were working with the company in 2006 (Tankovska, 2021). Facebook has
2.7 billion monthly active users making it the most popular social media in the world.
However, it has been reported that many users are leaving it for a variety of reasons.
3.1.6, Process in Facebook
Process is an important topic to discuss in the Marketing mix of Facebook. It usually
refers to a set of actions sequentially conducted in order to achieve something. Different
business functions may have different processes. For instance, the process of creating

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business pages with Facebook is that the users must sign up and create a personal page
first and then they can create a business page.
3.1.7, Physical Evidence of Facebook
Physical evidence usually refers to everything customers see when interacting with a
business. Though the physical evidence is very limited for a website, it can be said that
the Facebook website looks nice and has a number of features to engage users well and
provide them with very good experience. Facebook has offices and data centres around
the world, which have state of the art facilities and have a friendly and fresh ambience to
the workplace.
3.2,Facebook’s cost leadership Strategy:

Facebook Inc. uses the cost leadership generic competitive strategy. This generic strategy
involves minimizing the costs of doing business. Cost minimization enables the company
to reduce its prices competitively. The company also broadly provides its online social
media services to the global market. This condition is achieved through the nature of
Facebook’s business. For example, the company uses computing technologies to
maximize the efficiency of its social networking website. The online nature of this
business enables Facebook to easily reach Internet users across the international market,
thereby satisfying the broad competitive scope of the cost leadership generic strategy.
The cost leadership generic competitive strategy leads to the strategic objective of
expanding Facebook’s online social network user base. A related financial strategic
objective would be to increase the company’s revenues by at least 35% annually. In this
generic strategy for competitive advantage, Facebook has the potential to satisfy such
strategic objectives by focusing on growing its membership, which currently stands at
more than 2 billion monthly active users. Cost leadership is strongly linked to the
company’s intensive growth strategies.
Facebook is leveraging the appropriate value and cost drivers for the business strategy.
Facebook uses different techniques to maintain its cost leadership with at least 35 percent
annual revenue growth. To increase the users, Facebook has made alliances with
telecommunication networks and app developing companies. To play a particular game,
the users need to login through Facebook. Using such an approach, Facebook increases its
user base with existing assets. Apart from this, Facebook focuses on product development
to attract more users and advertisers. It adds features in the existing product as well as
develop new products. For example, Facebook has launched the app which does not use
more space in the mobile. This development attracts users who use Facebook in routine
and do not have compatible smartphones. Facebook works on related diversification also.
Facebook has acquired Oculus VR which will accompany the social networking service.
By this acquisition, Facebook maintains the revenue from other sources also.
3.3,Facebook’s Intensive Strategies (Intensive Growth Strategies):

Facebook’s growth strategy included achieving higher user engagement across its social
media platforms and growing its international markets’ penetration. Apart from the

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competition from other social media networks and mainly YouTube, the company faces
more challenges, particularly those related to user privacy and data security. It has faced
a series of investigations since the Cambridge Analytica scandal was unearthed.
Facebook is currently operating in a difficult environment with growing pressure to
control fake news circulation on the platform. Its main strength is its large user base.
Instagram has also enjoyed a lot of success and growth in popularity over time. However,
the company has not been able to monetize its Messenger and Whatsapp successfully.
Still, financially speaking, Facebook’s performance is impressive as its profit margins are
among the best in the S&P 500. In this report,, I will analysis the business growth strategy
of Facebook and how the company has achieved stellar growth. However, before that we
will analyse the target audience of Facebook.
3.3.1 Facebook’s target audience

Facebook’s core target audience is millennial users, including male and female users.
These users are also the largest segment of internet and smartphone users. These users
lead the most digital lives and spend a large part of their day on the internet and social
media channels. Apart from that, they are also the largest segment of online shoppers.
The largest demographics of users on Facebook include male users in the 25-34 age
group. They constituted 19.3% of the Facebook users in July 2020 according to Statista.
The second-largest user segment is that of male users aged 18-24 that formed around 14%
of Facebook’s user base during July 2020. Overall, while male users formed 56% of
facebook’s user base, the female users were only 44% of its user base.
Female users aged 25-34 were 13.2% of Facebook’s user base in July 2020 compared to
9.8% for women aged 18-24. Facebook has also achieved impressive penetration among
the users in the 35-44 age group. 9.6% of its user base in July 2020 was made up of male
users in the 35-44 age group, whereas 7.3% were female users in the same age group.
Facebook users come from all classes, and Facebook does not target a particular
economic class. Its largest market is India, which boasts over 290 million monthly active
users as of July 2020. India is also the second-largest market for smartphones after China.
However, Facebook does not have any presence in China because of the great firewall
that prevents social media activity. Apart from India, the other markets with a significant
Facebook user base include the United States, Brazil, and Indonesia, with more than 100
million users.
With the number of smartphone users growing each year, the number of users who access
the social media network from smartphones or mobile devices has also surged. 96% of
Facebook users accessed the site using a mobile device in July 2020, and 79.3% of the
total Facebook users accessed it using only a mobile phone. Facebook’s app experience is
different from the desktop experience and continued to find more popularity worldwide.
However, Facebook does not just target individual users, but it also targets corporate
customers or businesses. It targets businesses of all sizes, including small, medium, and
large businesses throughout the globe. Some of the leading advertisers using Facebook
for promotions this year included Walmart, P&G, Home Depot, CBS, ..... With its
growing user base and targeting capabilities, the company has also experienced sharp
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growth in its advertising revenue. It targets a large base of small and medium-sized
businesses that have their own pages on Facebook. The company attracts them through
lucrative advertising programs that promise higher reach at lower costs.
3.3.2, Central Pillars of Facebook’s Business Growth Strategy:

-Technological innovation: Facebook is counted among the largest technology brands in

the United States and globally. The core driver of growth for these brands is technological
innovation. Its focus on innovation has continued to drive the platform’s faster growth of
user base and revenue. The company has continued to invest in improving the user
experience to engage the users and drive conversion rates higher for advertisers that lay
ads on its platform. The higher focus of Facebook on technological innovation is also
because of the increased competition from the other internet and social media brands and
mainly Google, YouTube, Twitter, and other digital entertainment channels like Netflix.
As the size of the smartphone user base worldwide grows, so has the competition to
acquire users. While acquiring and retaining users requires the internet or social media
brands to provide differentiated user experience, it also requires them to maintain a
special focus on user engagement. All these things can be possible only if a brand
maintains a consistent focus on innovation. As in Facebook’s case, its success in social
media has continued to grow with the widening base of both of its platforms, including
Facebook and Instagram. However, the company has also continued to raise its research
and development spending to grow its social media and messaging products’
attractiveness. From 2017 to 2019, its research and development expenses grew by
around $6 billion. In 2017, its research and development expenses equalled $7.8 billion,
which grew to $10.3 billion in 2018 and then to $13.6 billion in 2019 (Facebook Annual
Report, 2019). However, with increased spending on research and development, the
engagement rates across its social media and messaging platforms also grew.
-A complementary product range: Facebook’s business has also found growth through
acquisitions. While its messengers and WhatsApp do not generate revenue, they are still
an important part of its product portfolio that has helped the company expand its user
base and engagement rates. The company has expanded its product portfolio a lot through
small and big acquisitions. Among all the small and large acquisitions that the company
has made in its lifetime, the most prominent ones are Instagram, Whatsapp, and Oculus.
Apart from these three, the company also made several smaller acquisitions in its history.
The company acquired Instagram in 2012, which is perhaps its most important acquisition
till now. Then, the company had acquired Insta for $1 billion, and later it acquired Oculus
and Whatsapp for much larger sums. The photo-sharing app has grown highly popular
and boasts of a large user base of around 1 billion monthly active users as of July 2020.
Just two years after the acquisition of Instagram, Facebook acquired WhatsApp and
Oculus. It acquired the messaging application Whatsapp for a whopping $22 billion. It is
still the largest acquisition that Facebook ever made. The user base of Whatsapp has
surged faster in recent years, rising to 2 billion. While the company was criticized heavily
for having paid a whopping $22 billion for Whastapp, the staggering size of the Whatsapp
audience is enough to justify the purchase. In the same year, Facebook also acquired the
Virtual Reality Tech company Oculus VR for $2 billion. Mark Zuckerberg wanted to
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acquire Oculus VR to develop immersive VR gaming. Overall, through these large and
small acquisitions, the company has expanded its services a lot. However, many smaller
acquisitions that Facebook made in its history were meant to strengthen its business
model and advertising.
-Higher penetration of existing markets: The company’s focus has also remained on
deeper penetration of the existing markets where it has a major presence. Apart from
China, the company has a strong presence in the other leading markets. India is
specifically its largest market and boasts of an audience size of above 290 million. The
US, Brazil, and Indonesia also have more than 100 million Facebook users. With passing
time, Facebook has continued to improve its social media platform and its services to
engage the users more and acquire more users. The company has also been advertising its
services to gain more users. Over time, its penetration among the internet-using middle-
aged and elderly population has also grown. While the company continued to improve its
features to increase the amount of time each user spent on the platform, growth in the user
base across various ages was also driven by its focus on innovation and marketing. The
company marketed its products and services locally in its various markets to acquire more
users. It kept optimizing its platform to make it attractive for the users across all age
groups. Higher user engagement also led to higher penetration of various markets. The
growth in its user base did not come suddenly, but the company has grown in phases.
-Mobile first: The base of smartphone users has grown a lot in the past few years. It is
now at around 3.5 billion and is expected to rise to 3.8 billion in the next year. However,
with increased access to smartphones and the internet, users worldwide are also accessing
a large web of services online. Facebook has proved highly aggressive at acquiring
smartphone users. As the number of people accessing the platform via its smartphone app
continued to grow, the company has also optimized its app to suit the smartphone users.
Facebook focused on a mobile-first experience since the percentage of people accessing
the platform only through smartphones was much higher than those accessing it on other
devices. If around 80% of Facebook users access the platform only via a mobile phone, it
means at least 2 billion monthly active users accessed Facebook on their smartphones.
However, it also means that Facebook’s revenue share from mobile devices has grown
very large in just some years. The crucial thing was to focus on the mobile app experience
and to design it for higher user engagement, which Facebook successfully did.
Accessibility and customer experience are important factors that have helped Facebook
win globally in the social media industry. While the network can be accessed from nearly
all internet-enabled devices, its focus on customer experience on small screen devices has
driven popularity and engagement rates higher for the platform.
-Targeting the emerging markets: The company has placed a strong focus on the
emerging markets, which account for a substantial part of the company’s user base
globally. For example, India and Brazil are two major markets that account for 290
million and more than 100 million Facebook users. As the company’s user base from
these markets rose, their contribution to the overall revenue has also increased. As a
result, Facebook’s focus on these markets grew. Some years ago, the users in emerging
markets like India were accessing Facebook over low-speed 2G network connections.

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However, to ensure that more and more people could access its services from the
emerging markets, Facebook needed to make sure that the app was loaded on
smartphones without a considerable lag time even over low-speed connectivity. In the
US, the users would make a few clicks on their smartphones, and the app would load
without considerable lag time. However, the case was not the same across many more
markets, including India. So, Facebook decided to make changes to its app to offer a fast
loading experience even when the connectivity was poor. The app figured the network
speed and accordingly loaded the right newsfeed stories. It was different from how the
app loaded on a high-speed network. The result was that in the emerging markets, users
accessing the platform on slower connections could still access the app without a
considerable delay. The quality of images could be slightly poorer than high-speed
networks common only in developed nations until some years ago. With time, the internet
quality in the emerging markets has improved a lot and has also expanded Facebook’s
user base there. However, the company also optimized its ad experience for the emerging
markets to grow the revenue it generated from these markets. Facebook’s strategy worked
after all, and the company achieved strong growth in revenue and user base from these
regions.
3.4 Conclusion: Facebook’s stellar growth as the social media giant of the world results
from its consistent focus on customer experience and technological innovation. The
company has expanded its user base vastly over the years. In recent years, the portion of
the user base accessing its services only from smartphones has grown a lot, and it has
brought the focus on mobile ads. While the company invests a large sum in research and
development each year, its investment in marketing also grew rapidly in recent years,
driven mainly by the higher competitive pressure. The emerging markets present growth
opportunities, and so the company has consistently been focusing on these markets and
mainly India and Brazil. Facebook’s profitability is high, and its operating margins are
impressive. In the coming years, as the smartphone user base continues to expand
worldwide, Facebook’s focus will remain on smartphone users to grow its user base and
revenues faster. Facebook's strategies all help the company earn a lot of revenue as well
as its reputation.

V. OTHER ISSUES
Facebook's biggest scandal occurred in March 2018, when 87 million Facebook users had
illegal access to personal data by Cambridge Analytica company, for the purpose of
political research for the election. elected President of the United States in 2016.
This shocking scandal caused a wave of boycotts and deletions of Facebook accounts
with the hashtag DeleteFacebook to spread, Mark Zuckerberg had to testify before the US
Congress, but could not explain why Facebook kept the case a secret. for 2 years but only
apologized and promised to fix the problem soon.
At the end of September 2018, Facebook discovered a security flaw related to the View
as feature that allowed hackers to access and control information of nearly 50 million
accounts.

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After that, 90 million accounts were required to re-login to Facebook across all devices.
Facebook is not sure if the hackers used the stolen information, nor is it clear who is
behind the incident.
-In January 2019, during a security audit, Facebook discovered that the passwords of 600
million users were being stored in text and completely readable by the naked eye in the
internal data system. However, Facebook insists that these passwords are completely kept
private from outsiders and there is no evidence that company employees abuse or access
customer passwords for malicious purposes. This latest scandal once again drives public
trust further and further away from Mark Zuckerberg and the Facebook brand.
After the scandals, Facebook paid a heavy price. They lost a lot of users, severely reduced
their stock. Besides the good points of Facebook, they also have weaknesses that need to
be overcome such as: security issues, how they handle scandals, .....

VI. References
https://www.facebookblueprint.com/student/activity/212757-get-started-marketing-on-facebook-
instagram-messenger-whatsapp#/page/5fc6db124a46d349e9dfe7bc

https://www.techwalla.com/articles/objectives-of-facebook

https://www.dummies.com/social-media/facebook/understanding-the-basic-principles-of-facebook-
culture/

https://investor.fb.com/resources/default.aspx

https://interestingengineering.com/history-of-facebook

https://www.britannica.com/topic/Facebook

https://bstrategyhub.com/facebook-swot-analysis/

https://www.slideshare.net/shankern4/business-strateg

http://panmore.com/facebook-inc-swot-analysis-recommendations

http://fernfortuniversity.com/term-papers/porter5/analysis/3535-facebook--inc-.php

http://panmore.com/facebook-inc-five-forces-analysis-recommendations-porters-model

http://panmore.com/facebook-inc-pestel-pestle-analysis-recommendations

https://www.investopedia.com/articles/markets/100215/twitter-vs-facebook-vs-instagram-who-
target-audience.asp

https://keydifferences.com/difference-between-facebook-and-twitter.html

https://notesmatic.com/facebook-vrio-analysis/

https://howandwhat.net/marketing-mix-facebook-facebook-marketing-mix/

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