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Why Isn’t Facebook Making More Money?

10 points by makimaki 18y ago

iamdave 18y ago
You know personally I'm sick and well beyond tired of these types of blogs that talk about valuations and marketing and ads with Facebook as if everyday users actually care. I can only count one circumstance where Facebook actually gave back after a brief little program with Microsoft, but other than that if Facebook is bringing in millions and millions of dollars with ad revenue, don't tell me about it unless they plan on sharing it with their users. Metcalfe's Law has never meant more than it does to me than when I read blogs like this.
- unalone 18y ago
  People who are involved in a business tend to be interested in making money. Facebook is spending a lot of money to please its users, and it wants to make some back. This is logical. Other people want to make money and it helps them to read stories of other successes and failures. Some of those people read Hacker News. I skip a lot of stories on HN. Try not to get too caught up in it. It's not worth your time.
furiouslol 18y ago
I thought the points made by the author are valid. The reason why Adwords work so well is because the ads match our intention at exactly the right time. If I'm planning a trip to Barcelona next week, a Barcelona hotel ad would appeal to me now but not last month. Timing matters. Just because Facebook knows a lot about me does not mean their ads appeal to me. If I like Japanese food, do I need to be bombarded by Japanese food ads every day? Google's ads, on the other hand, will only show the Japanese food ads, when I am explicitly looking for Japanese food.
- greendestiny 18y ago
  I think Google's been very successful with their approach, so much so people suggest its some kind of optimum. You've already got a fairly good idea of what you want when you're at the point of typing some keywords, and at that point its hard to beat Google, but there is a whole stage before that point where you don't have a keyword for what you want.
  - volida 18y ago
    If you know you want you know the word. Except if you mean people don't know what they want.
    - azharcs 18y ago
      'Want to Travel to China' is not a word, it is a desire. Ads for air tickets to China is an ad which realizes that desire.
    - lacker 18y ago
      You can know what you want without knowing the word. For example you might be thinking "I want to go to that website that is kinda like hacker news... but a bit more mainstream... and it has a little alien logo." You would know the website if you saw it, and if you could remember the word "reddit" your search would be easy. But you might not know that word. And the search kinda works anyways: http://www.google.com/search?q=hacker+news+with+alien+logo http://www.google.com/search?q=hacker+news+with+alien+logo
- ralphc 18y ago
  This still sticks in my mind. Three phones ago I had a Samsung, and was looking for how to get ringtones on it. I was served up ads for people selling USB cables for my model of phone, and someone I never heard of, on the other side of the world, got a sale. Whenever I'm on Facebook, based on my demographics the ads assume that I'm bald, fat and my Java code sucks. Google FTW, as the kids say.
vaksel 18y ago
I think part of it is the audience. Facebook has mostly young people and most of them don't bother clicking on ads.
ojbyrne 18y ago
$300 million is nothing to sneeze at. Last I saw they had ~ 500 employees = $50 million cost, double it to account for non-labor costs, and its a pretty healthy business especially in difficult times. They have the cash flow to experiment further to get to google-like revenues (which is what they're doing).
known 18y ago
What is the real USP of Facebook?

10 points by makimaki 18y ago

You know personally I'm sick and well beyond tired of these types of blogs that talk about valuations and marketing and ads with Facebook as if everyday users actually care. I can only count one circumstance where Facebook actually gave back after a brief little program with Microsoft, but other than that if Facebook is bringing in millions and millions of dollars with ad revenue, don't tell me about it unless they plan on sharing it with their users. Metcalfe's Law has never meant more than it does to me than when I read blogs like this.

unalone 18y ago
People who are involved in a business tend to be interested in making money. Facebook is spending a lot of money to please its users, and it wants to make some back. This is logical. Other people want to make money and it helps them to read stories of other successes and failures. Some of those people read Hacker News. I skip a lot of stories on HN. Try not to get too caught up in it. It's not worth your time.

furiouslol 18y ago

I thought the points made by the author are valid. The reason why Adwords work so well is because the ads match our intention at exactly the right time. If I'm planning a trip to Barcelona next week, a Barcelona hotel ad would appeal to me now but not last month. Timing matters. Just because Facebook knows a lot about me does not mean their ads appeal to me. If I like Japanese food, do I need to be bombarded by Japanese food ads every day? Google's ads, on the other hand, will only show the Japanese food ads, when I am explicitly looking for Japanese food.

greendestiny 18y ago
I think Google's been very successful with their approach, so much so people suggest its some kind of optimum. You've already got a fairly good idea of what you want when you're at the point of typing some keywords, and at that point its hard to beat Google, but there is a whole stage before that point where you don't have a keyword for what you want.
- volida 18y ago
  If you know you want you know the word. Except if you mean people don't know what they want.
  - azharcs 18y ago
    'Want to Travel to China' is not a word, it is a desire. Ads for air tickets to China is an ad which realizes that desire.
  - lacker 18y ago
    You can know what you want without knowing the word. For example you might be thinking "I want to go to that website that is kinda like hacker news... but a bit more mainstream... and it has a little alien logo." You would know the website if you saw it, and if you could remember the word "reddit" your search would be easy. But you might not know that word. And the search kinda works anyways: http://www.google.com/search?q=hacker+news+with+alien+logo http://www.google.com/search?q=hacker+news+with+alien+logo
ralphc 18y ago
This still sticks in my mind. Three phones ago I had a Samsung, and was looking for how to get ringtones on it. I was served up ads for people selling USB cables for my model of phone, and someone I never heard of, on the other side of the world, got a sale. Whenever I'm on Facebook, based on my demographics the ads assume that I'm bald, fat and my Java code sucks. Google FTW, as the kids say.

vaksel 18y ago

I think part of it is the audience. Facebook has mostly young people and most of them don't bother clicking on ads.

ojbyrne 18y ago

$300 million is nothing to sneeze at. Last I saw they had ~ 500 employees = $50 million cost, double it to account for non-labor costs, and its a pretty healthy business especially in difficult times. They have the cash flow to experiment further to get to google-like revenues (which is what they're doing).

known 18y ago

What is the real USP of Facebook?