According to a report in the Wall Street Journal, it looks like Facebook (NASDAQ:FB) is thinking about implementing hashtags in its social network.
Hashtags are shorthand tags to identify popular topics — like #Superbowl or #LadyGaga. They’ve exploded across the Web and the Internet, especially on the Twitter platform. While many people think Twitter started hashtags, it didn’t — its users started using them in 2007, and Twitter initially tried to stop the practice, but failed.
Obviously, it’s easy to fall in love with hashtags.
Why Hashtags, Facebook?
Facebook’s actual plans look sketchy as to when — or even if — it will launch hashtags.
But hashtags could be an effective way to help organize content on Facebook. Let’s face it, the social network is essentially firehose of information, which can lead to a cluttered experience.
Facebook has tried to improve this through a few initiatives. For example, the company recently launched its Graph Search, which makes it easier to find information. And more recently, FB redesigned its News Feed to make photos larger and allow users to segment their content in different categories. Such content would be ideal for hashtags.
Instagram, which Facebook purchased last year, already has hashtags for categorizing photos. It’s actually one of the top features and has been a key factor in increasing usage of the service.
The Money
Hashtags also could prove to be a nice money maker. This has certainly been the case for Twitter, which sells various trending hashtags to mega-brands.
Hashtags tend to monetize well in a mobile environment — they’re simple links that don’t take up much screen space. And users love to click links.
That’s helping the company rapidly become a big force in online and mobile ad spending. eMarketer predicts that Twitter’s revenues could exceed $800 million this year.
Bottom Line
True, hashtags are primarily the domain of the tech savvy — grandma probably won’t be using them on Facebook. But that doesn’t really matter. Facebook needs to keep its power users engaged and hashtags should be a natural way to do it.
Especially with the experience they’ve gained from Instagram, it should be fairly easy to pull off.
Tom Taulli runs the InvestorPlace blog IPO Playbook. He is also the author of “How to Create the Next Facebook” and “High-Profit IPO Strategies: Finding Breakout IPOs for Investors and Traders.”Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities.
A long-time follower of the IPO scene, back in 1999 Tom started one of the first sites in the space called WebIPO. It was a place where investors got research as well as access to deals for the dot-com boom. Tom also wrote the top-selling book, Investing in IPOs. In it, he covers all the aspects of analyzing an IPO, such as reading the prospectus, detecting the risk factors and understanding some of the arcane regulations. But don’t worry — if that process is too intimidating for you, thankfully Tom will do the legwork for you right here in the IPO Playbook blog.
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