Marketing Strategy

If Facebook Were a Country…

Facebook, the world’s largest social network company, is set to launch its Initial Public Offering (IPO) next month. Given all the hype that this IPO has generated, The Marketing Id would like to lift this speculation to an entirely different level – what if Facebook were a country?  In the spirit of its forthcoming IPO, we refer to Facebook in our discussion below as, FB, its proposed common stock symbol listing.

With a projected subscriber base of 1 billion by August 2012, per Gregory Lyons of iCrossing (a digital marketing agency), FB would qualify as the third most populous “billionaire nation” after China and India.

The Marketing Id suspects that FB could even become the most populous “country” in a couple of years if current growth trends continue.  FB hopes to rapidly expand in the India market, where it currently has ~45 million subscribers amongst India’s ~120 million Internet users, and where Internet penetration is presently only ~10% of the population, but expected to grow briskly over the next few years.

Per its S-1 filing with the SEC, FB “had more than 425 million MAUs who used Facebook mobile products in December 2011.” (Note: MAU – monthly active users).  Again, FB qualifies as the third highest “nation” of mobile phone users behind China (1.01 billion) and India (911 million) – these numbers, courtesy Wikipedia.

Unfortunately, FB admits in its S-1 filing that it does “not currently directly generate any meaningful revenue from the use of Facebook mobile products.”  With this tremendous “mobile in the hand” opportunity being squandered for “two PCs in the bush[1],” The Marketing Id wonders how long before FB, a likely third-largest “country” of mobile phone users, capitalizes on its massive mobile subscriber base?  Will FB do a Google to monetize mobility because its recent Instagram acquisition is certainly not the answer?

In its S-1 filing with the SEC, FB says its “mission is to make the world more open and connected.” So if FB were a “country,” it clearly would be a free nation – in more ways than one!  Because FB does not currently require any of its citizens, i.e., subscribers, to pay taxes, i.e., service charges.  Thus if FB were a “country,” it would live up to its founding definition and be a socialist state providing a range of services to its citizens for free!

FB reports in its S-1 filing that it generates “a substantial majority of our revenue from advertising…”  The Marketing Id noted FB had 2011 revenue of $3.71 billion and net income of $1 billion, which translates to $4.39 in revenue per active subscriber and $1.18 in net income per active subscriber in 2011.  Per a Business Week report published shortly after its S-1 filing, FB’s market valuation topped $100 billion.  This valuation makes each active FB subscriber worth ~$118, even though FB generated only $4.39 in revenue per active subscriber in 2011 – a “neo-capitalist” model that gives new meaning to the “social” in an increasingly ubiquitous social media framework!

Finally, if FB were a country, it would be a multicultural melting pot with representation from people across the globe.  FB’s diverse subscriber base, i.e., diaspora of ethnicities, would ensure that it was in the forefront of freedom movements, such as the Arab spring, helping topple dictators.  FB as a country would provide a voice for people in the most remote regions of the world. FB could effectively function as the United Nations of social media!

Having said all of the above, if FB were indeed a country, it could only be a 21st century version of the good old US of A!

[1] FB has almost half of its subscribers using its mobile products

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