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Social Network Essay

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Clearly the most valuable strategy Zuckerberg uses is differentiation. Being a college student himself at the time of Facebook start up, he uses his personnel knowledge to understand what college students want. Being at Harvard the pressure is on to perform well, leaving little time in a student’s life to socialize. Meeting people with less time involved is a service that Facebook provided. The exclusivity to college students gave the site a differentiation that appealed to college students. The scene where his friend is asking if he could find out if a girl in one of his classes is in a relationship is an example of this differentiation. This conversation then spawns the idea to add relationship status as a feature to Facebook thus making it even more appealing to college students.

Low cost distribution; this is also another key strategy. You cannot get a lower distribution cost than free. Essentially the more people he added to the site the more valuable it became as a college networking tool. All of the cost of distribution fell on the clients not the owner. As long as the college student had an email address and access to the internet, the distribution of his product was executed. Again differentiation was the key to the free distribution the more appealing he made the site to college student the more the word spread about the product and more clients would spread the word about Facebook. This of course is another bonus: free advertising by word of mouth from his clients. Talk about lean operations!

Peter Thiel’s joint venture with Facebook illustrates the cooperation strategy. This venture capital allowed Zuckerberg to expand his network of computers and data storage to accommodate his ever growing customer base. In the movie Saverin cuts off the money to Facebook’s operation.

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