Question

1) Consider any recent acquisition by Facebook. Why do you think Facebook purchased the company? Suggest ways in which the app has been monetized

2) With the emergence and now certaintly of online commerce, are store fronts still relevant in retail? If so, what role(s) do they play?

Answer 1

(1)The recent acquisition example is Instagram acquisition.I think that Facebook purchased the company -

1. Because it could. It’s fairly unusual for a company to drop a cool billion heading into its IPO, but Facebook already has a ton of cash on hand (just under $4 billion according to its S-1 filing) thanks to private share sales to Goldman Sachs, says University of notre dam biz prof Tim Loughran. “Facebook, with huge cash on hand, is already acting like a big, publicly-traded tech company,” says Loughran. “Facebook didn’t need to go public first to get the cash to make the major acquisition.”

2. Because it didn’t want a competitor to snap it up first. “It appears that Facebook really wanted to purchase Instagram before another bidder (maybe Google ) made the deal,” says Loughran.

3. Because Facebook’s mobile app sucks. Instagram’s doesn’t.

4. Because Facebook is having a midlife crisis, and the acquisition of the beloved, hip photo-sharing app is its equivalent of buying a sportscar.

5. Because most people are on Facebook to look at other people’s photos, and Facebook wants to keep it that way.

The ways in which app has been monetized are:

(1)Optimize Your Site for Mobile Devices

Over 50% of the traffic that browses Facebook every day is mobile traffic, which is why it is so important that if your Facebook links to an external site that it is optimized for mobile. If you can capitalize on a mobile audience, you can find quite a bit of success.

One of the best ways to ensure that your traffic from Facebook stays on your site and converts is to have a responsive site. This means that no matter what device a user is on your website adjusts and gives the best user experience.

2. Sell Digital Content Directly

The first option to monetize your Facebook page is arguably the easiest. The simplest example of this is pretty easy to describe. Promoting an eBook on your Facebook page is a great way to keep your audience engaged and connect across your various websites.

If you have plenty of content to distribute, Facebook makes a great platform to sell your wares. EBooks are easy because Amazon and Barnes and Noble both have distribution platforms which you can take advantage of and the best part is that Facebook integrates very easily with most external platform.

3. Send Traffic to Affiliate Marketing Sites

This is another option you can use to make money by advertising on Facebook, but you will need to be a part of an affiliate network. If you are influential, joining an affiliate network should not be a problem. Having the ability to reach a lot of people is very beneficial and many brands will take notice. Once you are a part of an affiliate network, just posting a link will be enough to gain attribution for your contribution. This is very easy to set up and use, many systems have built-in tracking available. Many brands have affiliate networks in place which they use to manage their affiliates and track the sales or traffic you are able to drive.

(2)Retail is evolving quickly and there are many predictions about the store of the future. Some suggest the death of the brick-and-mortar model; others talk about a world where there is no checkout, no queuing – a world so smart that predictive technologies restock our necessities as they run out. But what’s the reality?

Despite the rise of e-commerce, online channels accounted for only 8.7% of global retail sales in 2016, and in 2019, 87% of retail sales will still occur in-store. So, while the discussion continues, most agree that the physical store is likely to remain, except that its focus will change – distinctly.

The store of the future: an experience hub, a fulfillment center

The store of the future will no longer focus on making a sale. Instead, physical stores that survive well into the future will change how they operate and service their customers. Stores will increasingly move from showrooms to playrooms where shoppers can experience products in a meaningful way. They will become experience hubs for consumers, allowing product immersion that eventually drives a purchase, online or offline. Ultimately, the retailers that win will be those that can leverage powerful yet subtle technology to offer inspiring physical experiences to shoppers, as well as moments that touch them, to result in conversions.

While the physical store will likely continue to play a key role, it’s also clear is that consumers will continue to increase their shopping online. This is especially so in Asia-Pacific, which will remain the world’s largest retail e-commerce market through 2020, with sales topping $1 trillion in 2016 and more than doubling to $2.725 trillion by 2020.

This gives traditional retailers an opportunity to capitalize on the biggest advantage they have over their online pure-play counterparts – the physical stores themselves. By transforming the store into one that blends physical and digital, a retailer can provide an evocative, experiential shopping journey as well as create a flexible fulfillment center. This enables retailers to profit from their investment in stores near where people live, work, and play.

The pressure is compounded by dwindling foot traffic in shopping malls, especially in the more developed retail markets. Many mall operators are proactively helping their retail tenants bridge the digital divide, transforming beyond mere “lifestyle centers” by exploring click-and-collect shopping, enhancing customer engagement experiences, and even experimenting with deliveries using drones. We’ll see more of these types of initiatives in the months and years to come and – in some cases – a reversal of the dwindling footfalls. Whether or not shoppers return to malls, one thing is clear: Retailers must innovate or fall to Digital Darwinism.

New technologies already transforming stores

We are already seeing today’s technologies influencing the store of tomorrow.

• RFID: At the Rebecca Minkoff store in New York City, when a consumer walks into a fitting room, an RFID tag triggers an interactive touch screen that displays product images and makes other product recommendations based on what the consumer is trying on. The connected store concept has tripled Rebecca Minkoff’s expected clothing sales. Similar connected fitting rooms in Ralph Lauren's Fifth Avenue flagship store in Manhattan gave the store a 90% customer engagement rate, beating the company’s expectations. These technologies allow retailers to discover information such as conversion rate per item, time spent in the fitting room, and conversion rate per fitting room visit. Data on items that are tried on but not purchased can help retailers optimize their merchandising strategy.

• Beacon technology: Imagine a consumer walking into his local grocery store. His phone buzzes, but it’s not a text message; it’s a welcome message from the store, delivered through an app he downloaded two weeks ago and likely hasn’t used since. Around  use their smartphones while shopping in stores. In Singapore, 66% of 90% of U. S. consumers use their smartphones to search for local information. This provides a great opportunity for retailers to take advantage of the connection shoppers have with their phones. Target is testing beacon use cases. The value of in-store U.S. retail sales influenced by beacon-triggered messages in 2015 was $4 billion which was expected to increase tenfold in 2016.