Case Study of Facebook

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Fachhochschule für Ökonomie und Management
University of Applied Science
Master of Business Administration (MBA)
3nd Academic Semester
International Entrepreneurship
Case Study

Course Instructor:
Stephan Beyer

Handed in by:
Wiebke Mohring201843
Berlin, November, 7th 2008
Table of Contents
Table of Contents2
List of Abbreviations3
List of Figures4
2Business Strategy of Facebook6
2.1Where are they active?6
2.2How did they get there?6
2.3How do they want to win the marketplace?7
2.4What was there speed and sequence of moves?8
2.5How do they obtain their returns?9
Appendix 115
Appendix 2 Integral Total Management (ITM) Checklist19
Declaration In Lieu of Oath24

List of Abbreviations
e.g.Latin, exempli gratia (for example)
et al.Latin, et alii (and others)
i.e.Latin, it est (that is)
ibid.Latin, ibidem (at the same place)
s.a.Latin, sine anno (without year)
s.l.Latin, sine loco (without place)
s.n.Latin, sine nomine (without name)
s.p.Latin, sine pagina (without page)

List of Figures

On the 15th of October 2008 one out of eight US-citizens, one of three Canadians and every second Chileans has a Facebook account. Facebook has 110 million registered users, keeping in touch and sharing information and pictures on the website (FAZ, 2008, s.p.). According to itself, Facebook is the 4th most-trafficked website in the world and the most-trafficked social media site in the world. Starting as an application for college students in the US only, today Facebook includes over 55,000 regional, work-related, collegiate, and high school networks. More than half of Facebook’s users are outside of college with those of 25 years and older being the fastest growing group of users. On the other hand Facebook stills maintains 85 percent market share among the students of 4-year U.S. universities. (, 2008, s.p.).

This assignment analyzes how Facebook made the extraordinary fast progress from a Harvard dormitory to a global brand in only four years. The two key questions of this assignment are: What caused the tremendous success of Facebook in the past? And will it still be that successful in the future? The structure consists of an explanation of the strategy, which made Facebook so successful and an outlook on future development. The first part follows the model of Hambrick and Fredrickson (2001, p. 48-59), whereas the second part is a SWOT analysis. The results of these two main parts will be presented in a short conclusion forming the last chapter. 2Business Strategy of Facebook

2.1Where are they active?
Facebook is a social networking website from the USA. Originally aiming at American college and later high school students, Facebook opened up for everyone and expanded to other countries in the last years. Facebook offers an internet version of the traditional paper-based Facebooks that contained profiles of newly matriculating students and were distributed by the universities among their first-year students. Facebooks allows its users to send messages and share pictures among their defined network of other users, which they have confirmed to be their friends. The main part of every profile is the “wall”, where new comments and some basic information on the owner are shown to other users. The idea of social networking via an individual profiles on a website was not new either. The first examples of such sites emerged in the late 1990ies and soon caught the attention of venture capitalist and internet giants like AOL, Yahoo! and Google. 2003 Facebooks main competitor MySpace was founded. The site offered many features, which Facebook includes as well, like groups, offering and confirming friendship, forums, messaging...
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