Facebook is already the biggest player in the social media space. In the first quarter of its 2018 financial year, Facebook reportedly added 49 million daily users around the world including one million people in the United States and Canada, taking the platform’s daily user figures to an impressive 1.45 billion users. The company’s revenue also rose during the same period. Facebook experienced $1.69 per share for revenue of $11.97 billion, meaning that the company successfully beat Wall Street estimates.
But while these figures would be more than impressive for the average company, Facebook isn’t merely satisfied and it has plans to grow its business even further. Just how exactly is the company doing this and how far can its new developments take it?
How Facebook is Improving Its Platform
You can never accuse Facebook of resting on its laurels as the company has recently announced several initiatives that could potentially spur user growth. Perhaps the biggest money-maker of the lot is Facebook’s decision to ban certain ads on its platform.
Noting that “bad shopping experiences aren’t good for anyone,” and also recognizing that missed delivery dates and poor product quality can cost consumers time and money, Facebook announced plans to forbid certain, untrustworthy e-commerce platforms from promoting their wares on its platform. The company declined to name or shame any specific retailers but said that it would be rolling out a new way for users to report businesses and these businesses will then be referred to Facebook’s guidelines before further action is (potentially) taken. Retailers are well aware of how social media can increase their sales, so this is a step towards ensuring that the relationships between businesses and their customers are not further jeopardized.
Facebook’s other big recent improvements are focused on improvements to streaming. Facebook Live is widely used as a marketing tool including for classes and live-streamed tutorials, but the company is keen to promote it as an entertainment platform too. This includes the full rollout of a feature called Sound Collection which allows users to insert copyrighted music into their videos (including songs, voices, and noises) and Facebook Gaming which aggregates live- streamed and prerecorded gaming videos, even allowing select game stream partners to receive support from fans in the form of $5 subscriptions. Facebook doesn’t just want users to use its platform, it wants its users to love it.
How Will This Impact Facebook Revenue and Growth?
As highlighted by Betway’s research into millionaires and billionaires, Facebook CEO and founder Mark Zuckerberg is already one very rich man. He is worth $71 billion and made the jump from millionaire to billionaire in just one year. This is far quicker than the likes of entrepreneur Alan Sugar (it took him 44 years), Alibaba co- founder Jack Ma (10 years), and Microsoft co- founder Bill Gates (five years).
But even so, Facebook’s recent improvements could potentially skyrocket Zuckerberg’s worth even further. Much has been made of the growth in popularity of gaming video content (GVC). For example, according to SuperData, the GVC industry is worth $4.6 billion and reaches 665 million people around the world, meaning that the Facebook Gaming platform could help the company to carve itself a sizeable amount of money and a brand new userbase, helping Zuckerberg to become an even richer man.
Meanwhile, Facebook Marketplace is already used by 550 million people (in terms of formal buy-and-sell groups). It’s unclear exactly how many of them spend money using the feature each month, but it stands to reason that by giving users more of a reason to trust the platform as an e-commerce channel, it will be able to drive those sales and thus its revenue through the roof.
How Can Facebook’s Competitors Respond?
With these moves, Facebook is clearly going against the likes of Amazon’s game-streaming platform Twitch, Google’s video streaming service YouTube and e-commerce sites such as eBay and Alibaba. While all of the companies are major players in their own right, few of them are as dominant as Facebook.
Facebook has the resources to spend $1 billion on a new data center, for example. It has so many users that it can easily test (and tweak) new features, making it incredibly difficult for its rivals to compete. It won’t be easy for Facebook’s competitors then, but it will be interesting to see how this battle heats up.
Share
Contributors
