Facebook, the world’s biggest social networking company, faces a bewildering challenge as it prepares for its initial public offering slated for Friday. The much-anticipated IPO is estimated to reach a record $100 billion.
Facebook has shown rapid growth over a short period of time, posting $3.7 billion in revenue last year. It has become an integral part of daily life for adults around the world, with the growing use of smartphones, tablets and notebook computers.
More than 40 percent of American adults log onto the site at least once a week while 55 percent those under age 35 go on Facebook every day. There are some 900 million people using Facebook around the globe.
Despite such impressive numbers, however, not many seem to place much trust in Facebook. According to a recent Associated Press-CNBC poll, half of Americans consider Facebook a passing fad. Also, half of Americans are skeptical of the company’s expected asking price for its coming IPO, saying it is too high.
On top of it all, General Motors is planning to pull its ads from Facebook, the Wall Street Journal reported Tuesday, because of the minor impact the paid ads had on consumers.
“So far, Facebook’s advertising platform hasn’t kept pace with the explosive growth of its social network, and it remains to be seen if CEO Mark Zuckerberg even wants to focus on advertising as a source of revenue,” said WordStream chief technical officer Larry Kim.
In the poll of U.S. adults published Tuesday, 83 percent of respondents said they “hardly ever’’ or “never’’ click ads on Facebook.
“As good as Facebook has been at evolving to serve consumers, that’s how bad it’s been at serving marketers,” Forrester analysts Nate Elliott and Melissa Parrish said in a blog post.
Instead of exposing user information directly to advertisers, Facebook delivers ads to specific groups of people. Also, Facebook has yet to support advertising on smartphones or tablet computers.
By Sim Guk-by
Intern Reporter
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