Facebook, aiming for global domination, is gaining quickly in Asia
Nov 16th 2009 6:15PM
Updated Dec 4th 2009 4:50PM
Facebook, however, is well on its way to establishing dominance in several parts of the world. Already very strong in North America and Europe, Zuckerberg (pictured) looks set to take Asia, too.
According to the folks over at Inside Facebook (which covers the social network ad nauseum), Facebook is making huge gains in Asia. Among the 30 Asian countries that Inside Facebook tracks, active Facebook users grew by 9.6 million from Oct. 1 to Nov. 1, an increase of nearly 20%.
This growth is significant because Asia is the most populous region on Earth. It's also an economic dynamo, likely to provide much of the world's growth. So, a strong Asian position will likely translate into bigger revenues for Facebook. For the record, Google (GOOG), the most easy comparison to Facebook, has constantly struggled to gain market share in Asia, particularly in China and Japan.
As Hong Kong Goes, So Goes China?
If Facebook can gain the same type of purchase in Asia that it has garnered in the U.S. and its revenues follow a Google-like growth curve, then Zuckerberg could have the next truly boffo technology IPO on his hands. Following the numbers certainly implies it's on that track. In India, which has 1.1 billion citizens, Facebook has only 5 million active users, but that tally grew last month by a solid 17%.
Users In Hong Kong grew by only 6%, but nearly 40% of the populace already uses the social network. Strong penetration in Hong Kong is a good indicator that Facebook will do well in Mainland China, where it has been blocked until now by government authorities who feared the network could be used to circumvent censorship. Inside Facebook does track use among Mainland Chinese who have figured out how to circumvent the Great Firewall. Granted, this group represents very early adopters. But Inside Facebook tracked nearly 300% month-over-month growth, an increase that would seem to bode well for Zuckerberg's prospects in the Middle Kingdom.
Only in Japan has Facebook completely fallen flat. It has less than 1 million users in the Land of the Rising Sun, says Inside Facebook.
Clearly, Facebook is pushing hard to grab more users in Asia. It has recently released updates to its iPhone and mobile applications in Japanese- and Chinese-language versions (its lack of a Japanese-language mobile app in a country where the phone is more important than the computer might help explain why Facebook has failed there to date). And the company has made globalization a huge priority, creating a technology that makes it easy for users to alter Facebook's language, look and feel to help the company tailor local versions at very little added cost.
Ads That Go Only to Those Who Are Connected
Complementing the moves into Asia are new ad-targeting technologies from Facebook. Most notably, a new "Friends of Connections" capability has made it very easy for brands or companies to send ads to people who are connected to existing friends of a particular fan page, application, group or event. For a large company like McDonald's, this could provide a very convenient and unobtrusive way to use friendship connections and loose social ties to send marketing pitches to related parties without asking friends to impose themselves on others. It would require minimal effort on the part of the companies and brands.
This could be particularly well-suited to Asia, where people tend to have smaller but tighter social networks. More cohesive networks could mean that each ad targeted at friends would be more likely to garner a click or a recognition. That would translate into more revenues, which is the grand scheme right now for Facebook as it pushes hard to better monetize its popularity and rewrite the rules of online advertising.
Of course, this new ad technology also raises the risks of advertisers offending users. Facebook has struggled to tame application spam that bombarded friends of game players with insipid notifications. Facebook has also struggled to remove misleading ads embedded in social games that were designed to get users to sign up for cell-phone services and video-rental subscriptions without realizing they had done so.
But, in general, between Asian growth and new ways to advertise to friends, Facebook is tapping into two key shifts in the online universe: the rise of the East and marketers' requirement for engagement to justify spending big ad dollars.
Alex Salkever is Senior Writer at AOL Daily Finance covering technology and greentech. Follow him on twitter @alexsalkever, read his articles, or email him at firstname.lastname@example.org.