Facebook's Global Corporate Strategy: Successes, Failures, and Tools

This report provides a comprehensive analysis of Facebook's global corporate strategy, exploring its journey from inception to its current status as a leading social media platform. The report delves into the successes and failures of Facebook, offering insights into the factors that contributed to its growth and the challenges it faced. Key aspects include the effectiveness of Facebook's advertising model, its massive user base, and the reasons behind its success, such as ease of use, frequent upgrades, and engaging features. Failures, such as personal information leakage and security issues, are also examined. The report applies strategic tools like VRIO analysis and Porter's Five Forces model to assess Facebook's competitive advantages and industry environment. Recommendations are provided to sustain future success, drawing strategic lessons from the Facebook case study and discussing the importance of global corporate strategy in today's business world. The report concludes by emphasizing the need for Facebook to adapt to dynamic changes and technological advancements to maintain its position as a top player in the social media landscape.

Running Head: GLOBAL CORPORATE STRATEGY 1
Global Corporate Strategy
Of Facebook
(Student Details)

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Executive Summary
The report highlights the journey of Facebook, its success and failures. The company has the
largest users from all around the world; still its path was not very smooth. The success and
failure of Facebook can be applied by other social media platforms to sustain their growth in the
future. In this report the reasons behind the success and failure of Facebook is discussed in brief.
It also states the important strategic tools that Facebook should apply in order to run smoothly in
the future. The strategic tools that have been used in this report are VRIO Analysis and Porter’s
Five Force Model. The study mentions the importance and ways of implementing the Global
Corporate Strategy for every business in the present scenario.

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Contents
Introduction......................................................................................................................................4
Question 1........................................................................................................................................5
Success of the group........................................................................................................................5
Failure of the group.........................................................................................................................8
Question 2......................................................................................................................................10
Strategic tools................................................................................................................................10
VRIO Analysis...........................................................................................................................10
Porter’s Five Force Model.........................................................................................................12
Recommendations to sustain success in the future....................................................................15
Question 3......................................................................................................................................16
Strategic lessons that Facebook case study offers.........................................................................16
Question 4......................................................................................................................................19
Global Corporate Strategy in today’s business world...................................................................19
Conclusion.....................................................................................................................................21
References......................................................................................................................................22

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Introduction
Facebook is an American social networking and online social media company based in
Caligornia. The founders of Facebook are Mark Zuckerberg, Eduardo Saverin, Dustin
Moskovitz, Andrew McCollum and Chris Hughes (Treadaway & Smith, 2010). It is categorized
under the Big Four companies of technology along with Apple, Google, and Amazon. Initially
the website founders gave membership only to the students from Harvard, Columbia, Yale and
Stanford. But now Facebook is the fastest growing networking site worldwide. Every user can
make registration and create their account without any fee. Facebook helps the users to fill
information about them and share it with others (Vander, 2010).
Mission Statement
Facebook’s Mission Statement is “to give people the potential to bring and build the world closer
together” (Vander, 2010).
Vision Statement
Facebook’s Vision Statement is “People use Facebook to stay close with family and friends, to
discover the new things going on the world, and to express and share their concern” (Vander,
2010).
Objective
Facebook’s initial objective was to design an online place for students to share events,
announcements and personal news; but now it has become a platform for marketing and doing a
business (McKenzie, 2019).

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Policies
Facebook has developed a set of policies of Community Standards to describe the list of things
that are allowed and not allowed on Facebook (Facebook, 2019). The goal is to encourage
positive expression and to create a safe environment. It develops its standards from time to time
in order to remain stable and authentic.
Question 1
Success of the group
Initially, Facebook was just a platform, where students could share information and
communicate. Today, the entire scenario has been transformed to a broader concept as it can be
used for adverting and business as well (Wittkower, 2010).
 Facebook’s Advertising is highly effective
When Facebook was started, no one guessed that it would become what it is at present. It has
more than 2.2 billion monthly and 1.5 billion daily users. This trend is not going to change any
soon as users are becoming habituated to the waves of new information era. It is considered to be
a top advertising online platform. In US 51% of advertising is done through Facebook and this is
explained in the following figure.

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(AdEspresso, 2019)
It is clearly shown in the diagram that Facebook has increased its advertising revenue when
compared to its last decade. Companies started to advertise their products and services on
Facebook because, through Facebook their sales started to increase. It is a simple process that
delivers the results fast. Through Facebook the companies reached their ideal audience. It
provides thousands of ways to reach the target audience. Facebook Ads are highly customizable,
new features can be added every month. The recognized brands who use this platform for
advertisement are HSBC, Nestle, McDonalds and DELL.
 Billions of users
Another success story of Facebook is that it has billions of users. Other sites do not enjoy this
advantage. People are addicted to Facebook and usually tend to spend hours on it as compared to
other sites (Hoefflinger, 2017).

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Reasons for its success
When Facebook started, a dozens of other social media networks also had the same type of
opportunities. Facebook was successful in maintaining its position due to the following reasons:
 It’s easy
The application of Facebook is very easy as compared to other networking channels, such as,
Twitter. To make a post successful it is not necessary to learn the use of hash tags, symbols or
@. It is all about sharing the life time experiences and events. The registration is for free and
very easy. It can be accessed very smoothly with easy log in and log out.
 Frequent upgrades
Another reason behind the success of Facebook is that it upgrades its channel from time to time.
This feature brings excitement amongst the users. The privacy and security functions are very
strong, we have an option of selecting the group who can check our posts and who should not.
Apart from this, it has rolled out a new feature called as Facebook Messenger, in which people
can chat and make video calls freely.
 Engaging features
Facebook is an addiction for many of its users. It engages people time and makes them stay on
the page for long hours. There is and application center on Facebook that allows people to play
games and be entertained.

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 More focus on the product
Facebook’s success also depends on the fact that it puts more focus on the product and its
development, rather than keeping high focus on its shareholders (Yao, 2016). Facebook got its
early success because other networks where busy managing the shareholders’ interests. In the
public report, Mark Zuckerberg mentioned clearly that the intention of the company is to
accomplish its social mission and the business comes second.
 Powerful analytics
Facebook has a very powerful analytics process. It helps the users to know complete information
about the content that have been shared, to differ between the organic and paid sources, and to
identify the best performing ads and posts with ease.
Failure of the group
 Personal information leakage
Mark Zuckerberg admitted the biggest mistake that he made by allowing the Cambridge
Analytica to gather personal information about the users (Ivanova, 2018). This act caused a
major disappointment amongst the users, as they do not have the same trust on Facebook that
they had earlier. The privacy and security functions were so strong that their users had shared all
their confidential documents with the concerned party on Facebook.
 Login to other sites with Facebook
Facebook allowed the users to log in to other sites with its credentials in the year 2008. This tool
was named as OpenID, and it accepted by all the users across the web. This feature opened a
platform for Facebook’s dominance of the internet. It made its “like” button function on other

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websites too; as a result the widespread tracking of individuals browsing history became very
easy (Oyza, 2015). This was a major failure and it had to update its privacy settings.
 Revealing of phone numbers
In 2013, Facebook notified the contact information of 6 million users, including their emails and
phone numbers (Ivanova, 2018). This mistake caused a negative impact on its business. The
installation of bug not only caused problem to the Facebook users, but also to the non-users
whose information were uploaded by their family and friends.
Reasons for its failure
 Lack of innovation
Mark in an interview mentioned that whenever he tried to bring some innovative changes in the
application, it resulted as a failure. One of the examples explaining this failure is the invention of
new app called Secret (Heller, 2019).
 Security issues
The major reason for Facebook’s failure is that it is having security issues. Many people do not
trust this network and avoids using it for business purpose due to the constant cascade of privacy
scandals and security issues (Heller, 2019).
 Facebook ADS are not setting the right campaign objective
The highest revenue that Facebook makes comes from the Facebook Ads. These Ads gives an
opportunity to optimize the Ads to be based on certain objectives. The main marketing objectives

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are not clear in the Facebook Ads. They fail to follow the awareness, conversion and
consideration policy.
Question 2
Strategic tools
Every organization needs a relevant strategic tool to maintain its position in the market for a long
period. Facebook has made a tremendous growth in terms of success and profitability in the past
years, but due to dynamic changes and advanced technology, it has to apply certain strategies to
maintain its position. The following strategic tools are recommended that Facebook should
follow:
1. VRIO Analysis
2. Porter’s Five Force Model
 VRIO Analysis
This tool will help Facebook to analyze its business activities to identify those factors that
contribute the most to bring a competitive advantage in the business. The following diagram
shows how the VRIO Analysis of Facebook can be done by discussing the sources of social
media that brings overall advantages.

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Primary Activities includes:
Inbound Logistics
Facebook should make effective use of its resources to handle its inbound logistics. The
resources that is acquires are office supplies, hardware and different types of technologies. The
company should develop frameworks to analyze this process (Dudovskiy, 2017).
Operations
Facebook should apply strategies to its operations very properly. The company has its data
centers and offices in nearly about 3o different countries. The main thing to handle in this
process is to transform the raw material into a format which is more users friendly. It should
have more sophisticated range of hardware and software.

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Outbound Logistics
For Facebook outbound logistics is nothing but the packed content which is provided to its users
through its respective application and site. The company should introduce more innovation way
of handling this in order to reduce time and cost.
Marketing and Sales
All the social media are focused on consistently expanding their target customer segment;
Facebook should use similar strategy to implement a multi-segment positioning and targeting
process.
Service
Facebook do not have a strong assistance for its customer service delivery, it should develop a
strong an immediate strategy to help its users immediately when needed (Lupkin & Carter,
2015).
Under this tool, Facebook also needs to concentrate on technological development and
procurement.
 Porter’s Five Force Model
The five force model of Facebook will help Facebook to determine various issues that affects the
company and harms its position as a top player in the social media platform globally. With the
help of this strategic tool the company can evaluate external forces that influence it and
understand the industry environment. This five force model was applied to Facebook and the
following analysis came into notice: