Keys for Facebook in 2010

They Keys for Facebook in 2010

In continuing our “Keys in 2010” series, today’s entry will be for the social media goliath, Facebook.  In case you missed the first entry in the series, read about Twitter’s Keys in 2010.

Yes we all know that Facebook is king of the world and yes it’s the most popular website on the internet.

But, when analyzing Facebook it is important to remember the rise and fall of Friendster.  In 2002 and 2003 Friendster was the darling of the industry.  They were today’s Facebook.  They quickly gained 115 million followers and were the talk of the internet.  Their founders were all over magazines, tv, and talk shows.  They were the king of the mountain, until the mass exodus.

Friendster grew too quickly, too fast and their network couldn’t handle the traffic.  Load times sometimes took minutes and as quickly as everyone joined Friendster, they left.  It is important to remember that social networking’s greatest strength is also its greatest weakness.  The web of influence can draw many people quickly somewhere, but once people start leaving, that same web can cause many people to leave even faster.  It is important to remember that all social media sites need to keep their users happy, because there aren’t a shortage of alternatives.

So enough of my rant, Facebook needs to accomplish some things to keep their dominance of the market in 2010.

1. Listen to their users – As long as Facebook does a good job of listening to their users they can keep them happy and keep it growing.  Lets be honest, Facebook monitors all their users, so lets hope that they are listening and making adjustments to what the masses wants.  The important issue regarding this is listening to what Facebook’s users want in their privacy policy.  The past few years has seen an uproar caused by various changes to their policy.  Nothing will cause users to leave faster than doubting their privacy and online safety (right MySpace?).
2. Keep Facebook, Facebook – Part of the downfall of MySpace (besides the massive hacking, lack of safety, and spamming) was that MySpace tried too hard to be like Facebook.  This alienated their main user base and made others think “well if it’s like Facebook, why not move on to the safer Facebook”.  Facebook may have had a slight panic earlier in 2009 when they revamped their homepage which had a much more Twitter-like feel.  Was this a coincidence they did this when Twitter was in its boom stage?  I think not.  Facebook needs to focus on the fact that they are Facebook.  They aren’t Twitter, they aren’t Google, they are Facebook.  Facebook needs to focus on making updates that are unique to them and that separate them from other sites, not make them more similar.
3. Show me the money – Much like Twitter, Facebook has a monetization problem.  Yes they are the most popular site on the internet but I believe last quarter was Facebook’s first in the black (pretty crazy eh?).  Facebook needs to find a better way to make money.  The obvious thing would be to increase the effectiveness of their ad space.  Facebook ads have a click through rate which is historically lower than that of the traditional banner ad (which is <1%).  If Facebook can find a way for ads to be more effective, users will be more likely to click through and they will receive more revenue.

So the moral of the story for Facebook in 2010 is don’t get greedy and take your users for granted, and give them what they want (Facebook).  As long as Facebook keeps doing these two things, they’ll be in good shape going into 2011.  Oh yea, and make some money.

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