SiliconFilter

Why Social Media is Cooking in Emerging Markets

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The Arab Spring, the Slavic Spring and the Iranian Twitter revolution all proved how deeply engrained the use of social media is in emerging market countries. But did you know that their rate of engagement with the likes of Facebook, Twitter, and YouTube is growing a whole lot faster than that of developed markets?


This post first appeared on Memeburn and was written by Michelle Atagana. Memeburn is an award-winning site based in South Africa that tracks emerging technologies primarily in emerging markets, including the Brazil, Russia, India, China and South Africa. SiliconFilter occasionally features relevant posts from MemeBurn.


Social media penetration is on the rise in emerging markets. A recent report from research and analysis site, eMarketer.com, looking at three studies from Pew Research Center, TNSDigitallife and Brazilian-based F/Nazca Saatchi & Saatchi on social media usage and how it is aiding brand awareness in emerging market territories.

Pew research social media

Last year eMarketer estimated worldwide social network ad revenues would surpass US$8-billion by the end of 2012, allocating just under half of that figure to the United States. “Non-US revenues were expected to grow faster, as marketers attempt to increase brand awareness, market share, and profits in fast-growth countries like Brazil, Russia, India and China (BRIC) and beyond,” says the research and analysis site.

Social media penetration in large emerging market regions such as the BRIC territories and countries Mexico and Indonesia, currently ranges from 56% to 86% of internet users, according to Pew Research Center’s “Global Digital Communication: Texting, Social Networking Popular Worldwide”. The highest figures go to Indonesia and Russia, at 86% for each in May 2011, up from 63% and 76%, respectively in 2010 — though F/Nazca Saatchi & Saatchi research reveals Brazil’s internet penetration reached 93% as of August 2011.

Brazil social network

Pew’s research further finds that in some markets, especially those with relatively low overall internet penetration, social network usage is higher than the US’s 60% of internet users. Notably in the past year, social media usage in Egypt has grown from 18% in 2010 to 28% in 2011.

A key point revealed by these studies is the way social media is being used in these regions and what it means for the emerging world. Last year’s social media revolutions may have woken the world up to the role social media can play in times of unrest, but also showed how important social media can be when it comes to consumer behaviour.

According to the TNS “Digital Life 2011″ study, social media marketing is more effective in emerging markets than more established ones. The study shows that users in “BRIC, Indonesia and Mexico were more likely to view social networks as a good place to learn about and buy brands and products than users in developed markets like Canada, the UK and the US”.

eMarketer explains the difference in growth between emerging markets and developed markets using an “experienced consumer” analogy. According to eMarketer, developed market users “are accustomed to third-party eCommerce sites and payment methods, and look to social networks mainly for keeping up with friends. In emerging markets, eCommerce is untested and new; and knowing the person or brand, even virtually, can engender more trust among users.”

The report speculates that the reason emerging market users engage more with brands on social media is due to “higher levels of trust” in these regions, which allows social networks to play a bigger role in the purchase cycle. Online shopping is still a relatively new idea in most emerging markets, being able to engage with brands on social media platforms helps build user confidence.

In the TNS report, Larry Bruck, senior vice president of global media and marketing operations at Kellogg Company, says “Digital is a business enabler, not just a marketing enabler.” Using the emerging world as example, Bruck explains that social media, not just online media, provides an opportunity to foster new business for savvy brands.



10:17 am


Mark Zuckerberg: Facebook Doesn't Acquire Companies for the Products but for the People

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startup_school_logoFacebook co-founder and CEO Mark Zuckerberg just told a group of aspiring entrepreneurs at Y Combinator’s Startup School that he expects to invest most of the money Facebook is currently making back into the business. According to him, it currently “doesn’t make sense to make a massive profit,” as Facebook is already able to provide the necessary incentives to keep and motivate its employees.

Asked about Facebook’s recent acquisitions, Zuckerberg noted that Facebook never acquired a company just for the product but for the people. He wants Facebook to have a very entrepreneurial culture and one of the ways for the company to do this is to acquire companies with great founders. These new employees, including FriendFeed‘s Bret Taylor, according to Zuckerberg, often end up working on products that are extensions of their startups.

Facebook’s Early Days

Talking about the mistakes he made, Zuckerberg noted that the mistakes the made while architecting the earliest versions of Facebook, including FMBL, are still bugging the company down sometimes. He also noted, however, that starting a web service in the early days was a lot easier than today. Now, with multiple mobile platforms competing for users attention, it has gotten more important for developers to create services that can be easily replicated on numerous platforms.

zuckerberg_ycombAsked about the early days of Facebook Zuckerberg also talked about his early experiences in Silicon Valley. According to him, his thought at the time was to see what it would feel like to be there, especially if he ever wanted to actually build a startup. As Facebook was already growing rapidly at the time, he – and some of his co-founders – decided to take the next semester off as Facebook was already using a data center in California.

Asked if he would move his company to the Silicon Valley again, Zuckerberg noted how the Valley offers new companies all the necessary services. He also pointed out that the Valley is very “short-term focused” and insular, but the fact that the infrastructure allows startups to quickly get of the ground makes it the ideal place to start a new business according to him.

During the interview, Zuckerberg also talked about his parents reaction to his decision to drop out. His mother, apparently, told him that she always expected him to drop out and his sister had a bet with him that she would finish college before he did.

The Social Network

In addition, he also took a few jabs at the “Social Network,” the fictionalized account of the early days of Facebook. While he noted that the movie got all of his shirts right, he noted that the general theme of the movie was simply wrong. He did not, for example, get the motivation to build Facebook from a breakup, but because he simply enjoyed building things. Taking a jab at the film industry, he noted that it is apparently hard for Hollywood to understand that sometimes “people just build things because they like to build stuff.” Clearly, Zuckerberg has decided to embrace the fact that the movie has pushed his celebrity status to a new level and throughout the interview, he seemed surprisingly comfortable talking about it.

What About China?

Currently, Facebook is planning to expand in Japan, South Korea and Russia, but China is clearly still a major issue for Facebook. Zuckerberg noted that he doesn’t want “Facebook to be an American company” and that the company has to follow the laws of all the company it is entering and be “culturally sensitive”. He noted that while the U.S. (and Facebook) has a certain standard for free speech, Facebook users can’t post Nazi content on Facebook in Germany. Zuckerberg himself is currently learning Chinese to understand the language and culture. How, he asked, can you want to connect the whole world if you leave out China?



4:54 pm