BBC News reports another share price drop in Facebook. Well this is not really a surprise is it? As mentioned before in previous blogs. It really looks like this stock is so over valued.
Why over valued?
Don’t get me wrong Facebook is great for certain things. It started out as a social tool and grew so quickly that there seems to be a demand to put a value on it and milk it for everything.
So why is it over valued? We think that most users will be using it as a social medium to contact with friends. Businesses can also use it to interact with it interested customers. however, the two main revenues are the apps and the ads.
We’re not experts, but…
As far as the apps go on Facebook the majority appear to be free, with some adding costs to buy extras. I’m am still to find someone who has bought facebook apps add-ons.
So the Ads. As an online marketing agency, we realise the importance of advertising online and the data that is held is superb for advertisers, however as the different channels go, this is not really a B2B market and only a b2c market.
What next?
Only time will tell, If people want to engage with business online they will probably search and like them their selves. Facebook has a great database and need to know how to use this better. Unlike Google where users are actually searching for a page, Facebook users want to chat rather than buy.
There is obviously a market for advertising but measured with the rest of the options. One further point is, give it 10 years will Face book still be with us? Google+ has great potential to steal a march over time. watch this space
We hope that this article is of use, feel free to forward it to whoever may find it useful.
Digital marketing agency Surrey
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