Facebook's announcements at F8 this week should come as no surprise to anyone who follows mobile or Facebook closely. Smart players around the globe from Facebook, Google, Amazon, and Apple in the US, to Alibaba and Tencent in China, are amassing mobile assets at an unprecedented pace. Both audience and data (i.e., what you know about consumers) matter in mobile and Facebook is building a strong base in both.
Consumers spend most of their time in apps on mobile phones. Most of that time is spent in a handful of apps increasingly owned by a handful of global players along with a large number of players who are strong in one or two areas (e.g., eBay, Twitter, Yahoo!)
Evolving apps into platforms that act as a portal or gateway to a large audience is logical and a well played out strategy to date. Each player started from a different position of strength (e.g., Alibaba with commerce, Tencent with messaging, Amazon with commerce, or Facebook with social media) and is building from there. Facebook, among others, is using a combination of organic growth and acquisitions to fill in the gaps.
With more than 500 million monthly active users (MAU's), they have proven themselves worthy of being a platform. Brands will start with content and then follow with services - from shopping to banking to booking flights. And, they offer fun. Life doesn't always have to be serious. Their introduction of fun and entertainment within the platform will resonate. US analysts are too dismissive of stickers, emoticons and the like. It's a key reason that big hits are arriving in the US from abroad.
Here are a few reasons why Facebook's Platform strategy is smart:
- Time spent in messaging is second only to social media for many consumers. Fundamentally, mobile phones are still about communications and sharing first and foremost, with media consumption following. Facebook dominates in the US market where other global brands have failed to build a strong base in either of these two categories. Facebook needs to push the pace and create what it will hope is an insurmountable advantage before Google or Yahoo! make stronger plays in the US, or Line, Tencent and others build out beyond their nascent US presence.
- Payments inside of messaging is genius. Adoption is high globally. Why? It is insanely convenient. Sending or transferring money within our banking apps is hard. They want routing and account numbers. They are asking us to ask our friends for private information ... and out in public over dinner or in a taxi. Payments within messaging apps remove the complexity. A consumer sets up money transfer terms one time within the app and then they can send money to any of their friends who have done the same - or even businesses. It is simply too easy for consumers not to use. The network is in place.
- Messaging offers context to sell services. Consumers use messaging to make plans with friends, share ideas, and connect with brands among other things. Let's take four friends making plans for Friday night as an example. Messenger allows for the group chat at the core. From there, embedding services from making restaurant reservations to booking an Uber ride to sharing the bill after dinner fits within an experience like messaging. And, the friends can share photos from the night out with one another afterwards. Similar scenarios could play out with shopping. Brands use messaging platforms to launch flash sales. As a consumer, if I can now pay or make a deposit within the app, I am more likely to buy - it is simply convenient.
Facebook is increasing its share of ownership of consumers' mobile moments. Many of those moments are for sale. Every enterprise or brand should be thinking about how Facebook fits into their strategy to win, serve and retain consumers on mobile devices.
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