Facebook Inc.: The concept of efficiency Essay - Essay Prowess

Facebook Inc.: The concept of efficiency Essay


Facebook Inc.: The concept of efficiency


Facebook Inc. presently boasts of more than a billion active users making it one of the most successful Social Media companies globally. The phenomenal growth of Facebook Inc. has been attributed to a business management model designed to incorporate both the medium-term and long-term objectives of the company (Haydon, 2013, p. 6). The optimal goal of each and every business oriented organization is to maximize on profit making initiatives. This can only be realized through efficient business management concepts formulated to progressively enhance an organization’s performance in a business environment that is erratic with regard to the competitive business environment. Business work flow management is critical towards ensuring that services and products supplied as well as the means for their production. This is indeed critical towards customer satisfaction, economic viability and marketing strategies which innovatively lock out competitors.  

This essay seeks to evaluate the concept of efficiency as it has been applied by Facebook Inc. in its business management strategies more so with regard to three critical areas. These areas with regard to the efficiency concept include economic aspects, customer care services and marketing will be addressed in depth in this essay.

Economics as a concept of efficiency

Facebook Inc. as a social media organization embodies a novel generation of multinational organizations with a profound international impact with the ability to realize economic value via diverse and facilitative ecosystems (Deloitte, 2012, p. 1). As such, Facebook Inc. has been accredited with enabling other players in the larger global economy to be able to improve on economic value in the larger global economy.

Facebook Inc.’s economic impact has been felt globally through it international day to day operations (narrow effects) as well as through broad effects accumulated by third parties benefitting from the expansive Facebook Inc. operating environment. (Deloitte, 2012, p. 1) The narrow effects of Facebook Inc.’s economic impacts result from a combination of three fiscal and economic effects. These include the direct, induced and indirect effects.  

Direct effects include the total amount in spending attributed to Facebook Inc. activities since its initial public offering in 2011. Facebook Inc.’s spending on its employee wage bill, tax revenues and the entire profits realized from the company’s activities world wide. Induced effects include the total economic value realized from Facebook Inc.’s spending in the wider global economy (Deloitte, 2012, p. 2). This in essence incorporates effects realized from direct as well as indirect effects accruing from company’s global presence and those of associated industries. Indirect effects on the other hand involve economic value realized from the total spending connected to peripheral supply chain companies working hand in hand with Facebook Inc. through the supply of vital networking infrastructure and other related products and services.  

An important aspect of Social Media organizations such as Facebook Inc. is that they have the innate propensity to facilitate for broader economic outputs (Deloitte, 2012, p. 7). This is due to the presence of many economic agents even though their physical footprint may be considerably small compared to that of Facebook Inc. These broad economic aspects include improved business participation, platform effects and technology sales.

Facebook Inc. has over the past few years facilitated for an enabling environment for organizations, big and small to advertise on their products and services in the expansive global market. Business pages on the Facebook website from both the commercial and non commercial organizations have led to the generation of improved sales figures (Deloitte, 2012, p. 4). This has in essence improved the concept of efficiency for Facebook Inc. through positive referrals from these organizations as well as from the likes approved by satisfied clients. Facebook Inc. has also diversified it revenue inflows through online advertising, a novel niche market for the company.

Increases in technology sales and the accrued platform effects have also been pivotal to Facebook Inc. The presence and profound economic effect stemming from the operations of Facebook Inc. have exponentially increased the demand for smart phones, personal PCs and other digital devices as well as broadband connectivity (Deloitte, 2012, p. 4). Platform effects have resulted from the development of specialized Apps communities enabling increasing frequency rates of social media activities on the Facebook website aimed at appealing to more of its consumers.

The narrow economic effects realized by Facebook Inc. were estimated at about 214 million Euros in Europe alone in 2011 and the creation of nearly 3200 employment opportunities. Broad economic impacts on the other hand, have been much higher than the narrow effects. In Europe alone, Facebook Inc. supported the creation of 230,000 jobs in 2011 and an economic impact estimated to be well over 15 billion Euros (Deloitte, 2012, p. 7).

Customer satisfaction as a concept of efficiency

In every capitalist business environment, customers are essential drivers for economic growth and development (Stevens, 2012, p 2). This ultimately implies that careful customer care initiatives are crucial to ensuring that a business’ management strategies incorporate concepts of efficiency relative to customer satisfaction (Barwise and Meehan, 2010). Facebook Inc. is one such organization which has been actively involved in ensuring that customer experience on the Facebook website translates to customer loyalty.

The Facebook website is a social media site where friends get to communicate effectively from remote locations. It involves people connecting with new friends, close friends as well as old friends (Barwise and Meehan, 2010). As such, Facebook Inc. is concerned with relationships unlike other business models which are solely transactional. Affinity and trust have been critical to the success of Facebook as a social networking site and has played a significant role in improving the company’s efficiency with regard to customers (Barwise and Meehan, 2010).

When the company was young, people simply chose to trust the new website and the trust that emanated from customer confidentiality by Facebook Inc. led to the phenomenal growth of the company (Barwise and Meehan, 2010). This worked well with the aspect of audience size, which as a result of consumer loyalty became funnel shaped such that Facebook users increased at an amazing rate. This enabled Facebook Inc. to progressively and innovatively improve on customer experiences so as to reap the benefits of the concept of efficiency in business management.      

 Marketing as a concept of efficiency

In an attempt to reap benefits from the global financial network, social media organizations apply marketing trends so as to enhance their global footprint globally (Pinheiro and Grillo, 2012, p. 6). In this age of information, Facebook Inc. has had to progressively innovate on the existing marketing strategies aimed at enabling more customer interconnectedness and making the customer experience more intuitive (Stevens, 2012, p 5).

Some noticeable changes in Facebook Inc.’s marketing strategy includes improved development of Apps as well as links to more web tools such as YouTube and Yahoo (Stevens, 2012, p 5). Such developments have greatly reinforced Facebook Inc.’s global footprint in the dynamic internet industry allowing for innovative opportunities with regard to commerce (Pinheiro and Grillo, 2012, p. 8). These include investments in brand management, e-marketing and improvements in customer relationships. For instance, marketing expenses have been reduced as a result of the numerous marketing tools accessible online. Research indicates that more than 65% of customers on Facebook willingly offer feedbacks on new services and goods. More than 52% of users express interests in the co-development of new services and products. Nearly 45% of Facebook users express interest in the co-creation of novel advertisement ideas  (Stevens, 2012, p 7).


Facebook is now by far the most popular social media site more so due to the company’s ability to influence the intentions, attitudes and behaviors of its customers. The business environment in which Facebook Inc. operates is quite competitive and as such, the company has been able to remain profitable even at a time when the world suffered a decline in economic growth. This has been made possible through business management practices which can also be described as innovative. These have driven up the company’s efficiency with respect to customer loyalty, economic and marketing aspects.    




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Deloitte., 2012. Measuring Face book’s economic impact in Europe. Final report, [Online] Available at: <http://www.deloitte.com/assets/dcom-unitedkingdom/local%20assets/documents/industries/tmt/uk-tmt-media-facebook-europe-economic-impact.pdf> [Accessed 28 November 2013].

Haydon, J., 2013. Facebook Marketing for Dummies. New York: John Wiley & Sons.

Pinheiro, M. D. and Grillo, A., 2012. Assessing Business Efficiency in the Use of Social Networking Sites: A DEA Approach. International Proceedings of Economics Development and Research Vol 59. 6. [Online] Available at: < http://www.ipedr.com/vol59/006-ICEMM2013-P00011.pdf> [Accessed 28 November 2013].

Stevens, E., 2012. Facebook brand fan and their impact branding and marketing strategy. Thesis Masters in Management, [online] Available at : <http://run.unl.pt/bitstream/10362/9621/1/Stevens_2012.pdf> [Accessed 28 November 2013].