May 30, 2017

New Facebook email versus Gmail

Apparently I’m over a week late on this, but Facebook has announced they are working on a revamping of their messaging platform to implement a full on email platform that will rival gmail (Yahoo Mail, AOL, etc.). This is to include POP3 and IMAP support (that means you can use it outside of Facebook).

Why is this such big news? In 2009, the time spent on personal email was surpassed by time spent on social media sites. Email is becoming more and more for business purposes while social media is the venue for personal messaging (even business use is shifting to some degree).

Is Facebook up for the challenge? Keep in mind that Google launched their social media platform – Orkut – one month before Facebook saw the light of day. If you’ve never heard of Orkut, it’s because it failed to gain adoption in the U.S… although it is huge in India and Brazil the same way David Hasselhoff is huge in Germany. One of the lessons to be learned is that huge companies – even Google – don’t always win.

But Facebook already has adoption and knows who your friends are. Plus, people are already using it for some messaging needs. It’s a crazy world.

Are you ready to rumble

So here’s the run down:

Google is doing everything including mobile phones and a new Operating System (Chrome) to rival Microsoft, Apple and even Linux. Plus they continue to try to push deeper into local search as evidenced by their failed attempt to buy Yelp.

Apple is trying to do everything, too. Recently, they have been in talks with Microsoft to use Bing as the default iPhone search engine instead of Google (what?!?!?!). To add insult to injury, Apple refused to accept Google’s Voice app into their App Store. All of this, of course, comes after Eric Schmidt (Google’s CEO) resigned his position as a Director at Apple based on a conflict of interest. Oh yeah, Apple also wants to be your cable TV provider.

Microsoft still has huge market share, but seems to be muddling by on its laurels. Although one of the reasons that Google’s $550 million bid for Yelp fell through was that Microsoft counter offered $700 million.

And Facebook continues it’s march to try to dominate how people interact online.

This is going to be a huge battle akin to the battle for delivering data to homes that pitted phone, cable, and satellite providers at odds when they all realized that fundamentally they were trying to do the same thing – deliver information.

Summation

So… how does this affect local organizations trying to reach their target audience and build patron relationships? Dunno, but unfortunately, I think this is going to get more muddled for the foreseeable future. In the meantime, hang in there and good luck trying to figure out where to put your time and money.

Let me know what you think!

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Comments

  1. Steve says:

    The problem with your “real world” groupon example is that it is anything but real world. The typical margins for a VERY high margin restaurant would be 20%. If you give away $20 in food you cannot say that it only costs you $6 to give it away if that is what the food costs unless leave it on the sidewalk for people to come, prepare themselves and pick up. The cost to you is also the cost to keep your lights on and clean the place and pay employees and yourself and numerous other costs. The you can add another $10 minimum to that cost of your food item in the restaurant bus and that is being really generous. Therefore your example is a money loser up front not the $1000 profit you mention. Also, you estimated your repeat customers at 75% of the total deals sold. You should be using 75% (which is a really high estimate anyway) of the total redeemed. Those were the only people that you had the chance to turn into return customers.

    • mcrudele says:

      Thanks for the feedback, Steve, although I think it might have been intended for a different post (not “New Facebook email versus Gmail”). It sounds like you might have been burned on a GroupOn campaign.

      The reason I created the calculator was so people could put in whatever numbers they thought appropriate and judge for themselves. If you have lower margins when you include both direct and indirect costs, then you should definitely use your numbers. In the original post (http://www.o2p.org/group-on-roi-the-math), I leave the definition of Margin purposely at a very high level because many business owners I’ve spoken to don’t go into the details that you do. However, the Case Study post (http://www.o2p.org/groupon-case-study) does come from a real business that is very focused on all aspects of cost and just happens to have modest overhead – they have been the only one to give me actual numbers and the numbers shown are real world (without quotes). Their business is obviously different from other people’s.

      Regarding recurring customers, this was intended as a way to get to a real number of new patrons that will return – whether they bought a Groupon and came in, bought a Groupon and didn’t come in, didn’t buy a Groupon but the advertising made them come in anyway, or heard about the business through Word of Mouth from one of these groups and they ended up becoming a patron. I have no idea how anyone would actually determine this number, but it was a variable that needed to be included for thoroughness (as noted at the end of the case study, “The number of new, recurring customers is very difficult to determine and is basically a gut-check. Unfortunately, it is largely responsible for the determination of the Long Term Profit… so be careful how you use it.”). Like several of the variables involved, it is a valid part of the equation, but very, very difficult to determine.

      The 75% number used in the case study was given to me by the business owner that offered the Groupon in the early weeks of his new business and he felt, since Groupon was the only advertising he did, it had a significant impact on driving new customers.

      You certainly seem passionate about the topic (and a little overly aggressive for my taste), but I made the calculator in order to do something that I had not yet seen anyone else do – provide some kind of way to determine the Groupon ROI without bias. I published the spreadsheet in order for people to make their own judgment and I posted the actual case study with the only metrics anyone provided me. It seems like your main objection was the numbers that were plugged in and not the mathematics. If that’s the case, feel free to post your own numbers and business information as a comment on one of the Groupon related posts and I’d be more than willing to do another case study. At the very least, maybe you can modify the calculator to better suit your individual needs and decisions.

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