There was a great piece in this weekends Observer talking about the second Dot-Com bubble a lot of money around driving the 'next' tech company valuation up. You can read it here
http://www.guardian.co.uk/business/2011/feb/20/is-this-the-start-of-the-second-dotcom-bubble
What is interesting about this is the basic principle of valuations that are based on future, or even wishful, earnings. Groupon turned down $6n, Twitter doesn't make any money but is valued at $10bn and Facebook was recently valued at $67bn. This is all in the hope that the information that Facebook users or Groupon buyers provide the platform will provide relevant consumer information for targeted advertising messages
So if we do the basic maths Facebook is worth $67bn so revenues would be around $17bn...with 550m users it means that each 'fan' is potentially worth $31 to a marketer.
A good CTR on a targeted Facebook ad is 0.5%.....looks like a bubble
2 comments:
Yet in December last year, Facebook served 35% of all online ads in the UK.
They may have low click through rate, but there are MANY...
It's a classic pump and dump scheme and the big boys are doing very well playing both sides.
http://www.rollingstone.com/politics/news/the-great-american-bubble-machine-20100405
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