Facebook is 17 – and more important than ever
In 2004, at Harvard University in Cambridge, Massachusetts, a social networking service called ‘TheFacebook’ was set up, with the purpose of connecting students around the university campus. Fast forward to 2021 and Facebook is now a multi-billion-dollar company with 2.5 million users, and in 2020 alone it achieved a revenue of over $60 billion. But how did a platform which was initially popular for connecting with old friends and uploading holiday photos for bragging rights become one of the world’s biggest advertising platforms?
With the sheer volume of users on the site and an impressive array of targeting methods and ad formats the platform is generally considered by marketers to be an essential part of any digital strategy.
The original adverts on the site back in 2004 were simply known as ‘flyers’ – which were largely purchased by students who used the site and local businesses. It wasn’t until 2006 that Facebook announced an alliance with Microsoft; as the social platform gained traction and users, they became the exclusive provider of banner advertising and sponsored links. In May 2007, Facebook unveiled Facebook ads, which connected users to brands and businesses – but only via trusted referrals from their friends – then in 2009 geographic and language-based targeting and mobile-specific advertising became the main way to reach users via Facebook. This was only the beginning of the evolution of Facebook as an advertising platform.
In 2012 we saw the introduction of custom audiences, then in 2013 came the introduction of lookalike audiences along with the Facebook conversion pixel. This was a huge game changer for Facebook advertising and allowed marketers to be extremely precise with targeting; opening new avenues for marketers to track engagement and conversions. Space & Time is a Facebook Marketing Partner, which gives our specialists access to the full range of Facebook’s audience targeting capabilities, and our experienced paid social team are constantly challenged to optimise clients’ campaigns towards the best performing audiences possible.
The expansion beyond the initial product offering of Facebook has been invaluable in driving the platform forward. Several key acquisitions that have happened along the way have also been essential in fuelling the growth of Facebook into something far greater than just a place to check what old colleagues are up to. A BBC article published in 2019 stated that, at the time, Facebook owned the four most downloaded apps of the decade (Facebook itself, Facebook Messenger, WhatsApp, and Instagram), each boasting more than a billion users.
These statistics make the platform’s original offering appear somewhat mediocre, and we can see that all the stops have been pulled out in the past 17 years to deliver an optimum user experience and to ensure that the possibilities for brands are as advanced as they can possibly be.
Perhaps the most famous purchase of Facebook’s history was the acquisition of photo sharing platform Instagram in 2012. Despite the company having a mere 13 employees and zero revenue at the time, Facebook founder Mark Zuckerberg went ahead with the purchase for $1 billion. This was clearly a strategic acquisition, as at the time it appeared to outsiders as one that was shrouded in significant risk.
In her book ‘No Filter – The Inside Story of Instagram’, Sarah Frier states that ‘Zuckerberg could buy, copy, or kill competitive apps, making sure there were fewer opportunities for other companies to encroach on anyone’s Facebook habit’, insinuating that Zuckerberg had great plans to take over not only Instagram, but a whole host of other social platforms that presented any kind of competitive risk to Facebook.
Although Facebook and Instagram operate as entirely separate entities, as marketers we are grateful for the close marriage of the two platforms, as it means we can optimise our clients’ campaigns with ease from one overarching ‘business manager’. Connecting accounts together enables us to evaluate insights such as audience behaviours and the performance of campaigns based on platform placement – an invaluable insight which allows us to achieve the best possible results for our clients.
WhatsApp was purchased in 2014 for $19 billion, followed shortly after by Oculus VR, for a more understated $2 billion. Referring to the latter, a historic article published by Facebook back in 2014 stated that ‘virtual reality technology is a strong candidate to emerge as the next social and communications platform’, and Zuckerberg had a vision that ‘one day, we believe this kind of immersive, augmented reality will become a part of daily life for billions of people.’
But has it worked? An article published on Bloomberg stated Facebook as the world’s biggest virtual-reality hardware maker following the Oculus purchase. But its position within this industry is not well received, with an abundance of scrutiny from founders of start-ups such as Cix Liv, founder of Yr Inc., stating that ‘our industry is getting eaten alive by Facebook’.
So, what could be next for Facebook? It’s no secret that Zuckerberg had planned to unite the group’s messaging apps by 2020, enabling their combined 2.6 billion users to communicate across the platforms for the first time. However, we are still awaiting this feature in 2021, with COVID-19 perhaps playing a part in the delay.
Looking back at some statistics published in 2020 on ‘Social Media Today’, we can predict some key features we expect will continue to rise. User generated content doubled from January to August 2020, and in Q3 of last year Facebook’s newsfeed ad placement received 58.2% of ad spend, compared with video feeds and instream videos. With the launch of Facebook shops and the ecommerce boom, we can predict that more users than ever will be shopping on Facebook in 2021 – even more reason to consider a solid, social-focused strategy for your brand.
So that leaves us to say ‘happy birthday’ to Facebook! We are delighted to have been on this journey with you so far and are excited to see what the future holds. If you’d like to discuss your Facebook strategy, get in touch and our specialists can help you understand how to make Facebook work for you.