Month: November 2013

@Josheph have blogged that Snapchat turned down a 3 billion dollars acquisition from Facebook. He stated that Snapchat should have accepted the offer because Snapchat has no revenue source. However, I do not agree with his viewpoint.

To begin with, let me share a story with you. Over three decades ago, a talented student from Stanford is asked to purchase bra for his wife. This guy was definitely embarrassed. Therefore, he took a $40,000 bank loan and borrowed $40,000 from his relatives to open a lingerie retail store. Several years later, this guy thought that it was a good time to ‘turn gold to money’; so he  sold his company to The Limited for $1 million. An amazing number for a lingerie retail store, isn’t it?  About 7 years later, this company became the largest lingerie retailer in America, topping $1 billion. As for our talented student, he chose to leap off the Golden Gate Bridge. Nowadays, this lingerie retailer is known as Victoria’s Secret.

Now, Snapchat has the same situation as Victoria’s Secret. Having a good trend of increasing users, more and more cooperations with different platforms, and fascinating functions. What is more, Snapchat takes the advantage of having a great number of active users who are teenagers. Therefore, I think that Snapchat is right. It should have a more ambitious target instead of satisfying the current situation. More than a kind of industry, social network is a revolution, and I believe that Snapchat will become a good leader.

By the way, the developers of Snapchat are graduated from Stanford, too.

@Xie, Zheran has shared some viewpoints about the success of an online game that is extremely popular no matter in North America or China. Xie’s opinions are really convincing, and I think there are more things we can learn from the great success of Riot, the creator of League of Legends. Here I would like to share my perspective as a player of League of Legends myself.

One of the most famous Internet entrepreneur, Jack Ma, has ever said,”If you want to succeed in the Internet industry, you should tell yourself that all of your potential customers are stingy, impatient, irritable, and foolish. You will succeed once these people satisfy your service”. I totally agree with Jack Ma’s saying, and I believe that Riot understand it clearly.

To begin with, everybody loves free things, especially the Internet users show more interest. For example, Napster is condemned by all the artists and journalism. However, for now, to be honest, who really pays for the authorized retailers? On the other hand, Riot do it in a right way that attracts a lot of players without any criticism.

Easy to play is another reason which made League of Legends succeed. In this way, Riot successfully expand its market, and attracts an increasing number of players. What is more important, these players really enjoys playing League of Legends. It reminds of a game I ever played on computer. It is really amazing technically, yet it is a failure from the perspective of a good. I can’t even finish the first level of this game! In contrast, League of Legends is an incredible work from this point.

Twitter achieved great success with IPO, which makes many employees of Twitter become millionaires. Most of Twitter’s employees love their company. However, nothing is perfect. A number of Twitter’s employees started to complain about Twitter because it grows too fast. In general, people think that growing at a fast speed is a good thing; why do the employees complain about it?

“Starting to feel like a big company, losing the startup feel”.

“Distributed office workers can sometimes feel disconnected from the HQ in San Francisco”.

“Manager inflation, and hierarchy, unfair and very nonuniform compensation”.

From my point of view, developing too fast is not a good thing for Twitter. As the employees of Twitter complain about, they are losing a startup feel. Unique culture is very important for a company, and the feel of employees is an essential part of company culture. In the beginning, the employees of Twitter feel like they were making a great company of themselves; so they were really inspired to work harder and harder. Yet the employees of Twitter started to feel like they are just the tools of profit-making tools as Twitter grows bigger. Moreover, too many managers and hierarchy make the employees feel unfair. Gradually, they will no long be willing to work for Twitter.

Sources:

http://www.businessinsider.com/worst-things-about-working-at-twitter-2013-11

Mark Zuckerburg recently tried to spend $3 billion cash on a company that only has an application sending disappearing photos instead of any revenues. In the first place, it is really astonishing that Facebook is willing to pay so much money, which triples the value of Instagram. What is more incredible, the company has rejected the $3 billion offer from Facebook. The company is well known as Snapchat.

Snapchat is so popular among young people, and it is the biggest competitor of Facebook and other social networks. On the other hand, Facebook has stated that, “Young people are becoming less interested in Facebook any more”. From my perspective, Facebook is willing to pay $3 billion for Snapchat for the following reasons.

One reason is that Snapchat is a novel social network whose main function is photo sharing, and photo sharing is also the main function to attract users for Facebook. However, Snapchat has a trend to become the most popular application of photo sharing, and it is definitely not a good news for Facebook. Another reason is that Facebook has an increasing loss of users, who show love to Snapchat. At this point, a lot of data and statistics in Facebook no longer exist; so Facebook will not know how people interact with each other well. This is really bad for the development of Facebook.

I believe that Snapchat is worth that much, even more. Therefore, to keep developing own company culture and to become a strong independent company are significant for Snapchat.

Sources:

http://www.wired.com/business/2013/11/facebook-snapchat/

http://www.theatlanticwire.com/technology/2013/11/facebook-tried-buy-snapchat-3-billion-or-three-instagrams/71564/

Recently,at the GigaOm Roadmap conference, Instagram CEO Kevin Systrom said that more than 5 percent of impressions they run on the ads resulted in Likes. A Michael Kors watch, which is advertised on Instagram, is successful in reaching over 6 million people. Systrom stated that over 5 percent of Likes is an amazing result for running an advertisement because most advertisements on the internet are ignored by people. Although more than 20 percent of comments that are negative strongly contrast with the beautiful data above,  Instagram advertisement still shows big potential and a good future.

The screenshot above is the first advertisement run on Instagram. In my opinion, Instagram advertisement is successful and shows big potential for the following reasons.

For one reason, the format of Instagram advertisement is more novel than other advertisements. The advertisement posts their products by sharing a snapshot just like other Instagram users; so Instagram users are easily attracted by the advertisement.

Another reason is, from the perspective of photography, this photo is an excellent work, which makes the advertisement enjoy a high quality. Therefore, Instagram users will not feel that their services are invaded by advertisements.

Lastly, differing from other advertisements, Instagram advertisement interacts with ‘potential customers’. All of the Instagram users are allowed to comment the advertisement freely. I think this help Michael Kors build a good customer relationship. Besides, Michael Kors can get the feedbacks from Instagram users quickly and improve its future advertisements.

Sources:

http://socialbarrel.com/instagram-ad-likes-compared-views-shows-big-potential/54057/

http://www.36kr.com/p/207509.html

Taobao, one of the five companies founded by Jack Ma, recently reached an astonishing sale record. Taobao generated sales of 35 billion RMB ($5.8 billion) on 11th November by a promotional campaign. This record doubles the sale record of November 11 with the same promotional campaign of last year. In addition, the total revenue of eBay for the 3rd quarter of 2013 is $3.9 billion.

Making such a miracle of one-day sales is not accidental for Taobao. In China, Taobao is the most popular platform of online shopping. Moreover, Taobao is the first company that tries to use mobile phones as trading platforms. Taobao takes different advantages from its competitors, and make the best use of these advantages. At this point, we can say that Taobao is a combination of Amazon, eBay, and Facebook. From my point of view, Taobao is so successful for the following reasons.

To begin with, Taobao is very good at advertising, and introducing its service to buyers and sellers; thus, Taobao occupies a large part of maker share. Besides, building perfect relationships with customers is another reason of  Taobao’s success. Taobao conspicuously shows the comments of customers for the reference of  potential customers, and this is a good way to help the sellers on Taobao improve. Last but not least, Taobao is so visionary that it catches up the trend of development.  Taobao make mobile phones become convenient trading platforms. This attracts a lot of customers, too.

Sources:

http://www.businesswire.com/news/home/20131016006533/en/eBay-Reports-Strong-Quarter-2013-Results

http://mi.techweb.com.cn/tmt/2013-11-12/1355373.shtml