Since floating on the stock exchange last year, Facebook has been busy trying to convince investors, as well as many naysayers, that it can deliver the holy grail of a sharply targeted and highly personalised marketing and advertising platform.
Its latest move, covered in some depth by this article in The New York Times, involves inking partnerships with four powerful, external companies that “collect lucrative behavioral data, from store loyalty card transactions and customer e-mail lists to divorce and Web browsing records”.
Facebook hopes these four data research companies will give it the resources to go beyond the extensive data the social network already gathers from its users in honing an ever-tighter sales pitch to advertisers:
Despite the streams of data Facebook has collected…the social network needs to know its users much better if it is going to become, as the company hopes, the Web’s most effective advertising platform. And Facebook is scrambling to do just that.
The move by Facebook to reach beyond its tightly controlled environment and engage the services of companies in the wider digital domain shows the ambition of Facebook’s strategy. It also demonstrates the increasing pressure it is being placed under by investors who have seen their stock price fall from an initial float price of $38 to its current price of about $25.
The push to refine targeted advertising reflects the company’s need to increase its revenue. Its shares are worth far less than its ambitious initial public offering price of $38 a share last May, and Wall Street wants to see it take concrete steps to prove to advertisers that it can show the right promotions to the right users and turn them into customers.
The partnerships show the scope of Facebook’s ambitious project and further underline that the market clock is indeed ticking on its great social platform monetisation project.
Nasty Gal goes from eBay to $120 million in sales
This is a great story from The New York Times – a classic rags-to-riches tale that chronicles the rise and rise of college dropout Sophia Amoruso from small fry eBay purveyor of vintage fashion to the Next Big Thing in US fashion retail.
Amoruso’s flinty fashionista attitude makes a refreshing change to the usual spiel of start-up entrepreneurs looking to do little more than bank a fat cheque at the first venture capital-funded opportunity:
By 2010, Nasty Gal started generating buzz among unlikely fans in Silicon Valley. Venture capital firms were pouring millions into e-commerce sites like ShoeDazzle.com, Kim Kardashian’s shoe subscription site, and BeachMint.
But the company [Nasty Gal] had been making money from Day 1. “They would say, ‘We want to invest in a woman-owned business — it’s part of our investment thesis,’ ” Ms. Amoruso recalled of her discussions with several venture capitalists. Her retort: She didn’t want to be part of their “investment thesis” and didn’t need their money.
“I don’t think they got it,” she said. “It’s this bunch of guys sitting around saying, ‘Oh, yeah, let’s start a Web site and put Kim Kardashian’s face on it.’ ”
Aside from the fashionista attitude, the article showcases what can happen when an entrepreneur knows their stuff – product and market in this case – and then applies the power of eCommerce platforms and social media to that knowledge.
Regardless of the actual product, the engaged entrepreneur can quickly spread the gospel to an eager market place if they put the time and effort into learning how to use tools such as Facebook, Instagram, Tumblr, Pinterest and Twitter to their advantage.
As with any shrewd businessperson, it helps if you can spot a bargain, especially in the early days of your business:
She bought a Chanel jacket at a Salvation Army store for $8 and sold it for $1,000. She found Yves Saint Laurent clothing online on the cheap by Googling misspellings of the designer’s name, reasoning that anyone who didn’t know how to spell Yves Saint Laurent probably didn’t realize his value.
You might not be in the market for a “towering lace-up platform boot with a five-inch heel” called the ‘Lita’, but this story will leave you suitably impressed with Amoruso’s willingness to back her talent and vision in the notorious rough and tumble of the rag trade.
Arrested development: What’s touch-screen culture doing to our children?
Google’s Sergey Brin raised a few guffaws recently when he called the smartphone a “kind of emasculating” device. Of course, Google Glass holds ample promise of being a far more macho way to navigate your way through this digital life!
But this in-depth story from The Atlantic takes a different approach to the broad issues Brin was trying to raise about how the tech devices we use can, for better or worse, have a far-reaching impact on how we live and see the world.
It looks at the influence that a pervasive screen-based culture, amplified in recent years by the almost universal adoption of tablet touch-screen devices, is having on children:
Not that long ago, there was only the television, which theoretically could be kept in the parents’ bedroom or locked behind a cabinet. Now there are smartphones and iPads, which wash up in the domestic clutter alongside keys and gum and stray hair ties. “Mom, everyone has technology but me!” my 4-year-old son sometimes wails. And why shouldn’t he feel entitled? In the same span of time it took him to learn how to say that sentence, thousands of kids’ apps have been developed—the majority aimed at preschoolers like him.
The article hits an interesting crossroad of cultural paranoia in our society: Is tech taking over our lives? And, how do we raise our children? The collision of these two issues makes for some deep and lively debate, especially as the academic research has yet to catch up to the state-of-play in many households.
To date, no body of research has definitively proved that the iPad will make your preschooler smarter or teach her to speak Chinese, or alternatively that it will rust her neural circuitry—the device has been out for only three years, not much more than the time it takes some academics to find funding and gather research subjects. So what’s a parent to do?
This article holds no easy answers, but it certainly raises a raft of important questions.