Everyone must be thinking how can a social networking site can make so much money and turned a student to a billionaire?
In February 2012, Facebook began selling stock to the public markets and by three months later, Facebook market value has reached an original peak of $104 billion dollars. Exactly 3 years later, their market values has increased to $212 billions. Other than making the money from outsources which is from the investor and shares market, Facebook basic earnings comes from the contextual ads on the Facebook page. It's hard to believe but only 15% of cash-flow that went to Facebook isn't from advertising, the remaining 85% of cash-flow are just from the advertising. Can you imagine how much money they actually made just from advertising???
The other way of Facebook making their money is from their entertainment service which is the Facebook games. For an example, when a user is playing a game and requires some certain items to upgrade their gameplay, they have to purchase the items using a virtual cash. This is where Facebook makes part of their money because before the user want to buy a certain stuff they have to use 'cash' to buy it and Facebook is the one that is providing 'cash' to the users. What the user bought mostly aren't real stuff, but they are virtual goods. For example casino chips, gift and bonus items, purchased by fans of the popular game "Texas HoldEm Poker" by Zynga.
Texas HoldEm Poker - by Zynga
Facebook confirms that the game and virtual goods are serious business. The company estimates that in 2010 the global market turnover for virtual goods reached $7 billion, and by 2014 it rose more than double the amount of estimation.
BIBLIOGRAPHY
1. Astrumpeople.com, (2015). Mark Zuckerberg Biography: Success Story of Facebook Founder and CEO. [online] Available at: http://astrumpeople.com/mark-zuckerberg-biography-success-story-of-facebook-founder-and-ceo/ [Accessed 24 Jun. 2015].
2. Biography.com, (2015). About Mark Zuckerberg. [online] Available at: http://www.biography.com/people/mark-zuckerberg-507402#time-at-harvard [Accessed 19 Jun. 2015].
3. PCMAG, (2013). The 10 Best Facebook Games. [online] Available at: http://www.pcmag.com/slideshow/story/299958/the-10-best-facebook-games/8 [Accessed 24 Jun. 2015].
4. PerthNow, (2015). Where does Facebook's MarkZuckerberg make his money?. [online] Available at: http://www.perthnow.com.au/business/where-does-facebooks-markzuckerberg-make-his-money/story-fn8t4my5-1226268542943?nk=226f88f68246ee487a816804a5f636f0-1435248538 [Accessed 24 Jun. 2015].
5. Wikipedia, (2015). Facebook. [online] Available at: https://en.wikipedia.org/?title=Facebook [Accessed 24 Jun. 2015].
No comments:
Post a Comment