When Facebook (NASDAQ:FB) got its start back in 2004, the original business plan was to focus on local advertising. The approach seemed sensible at first, considering the company was building a huge presence on U.S. campuses, but the strategy quickly faded and Facebook instead focused on branded ads.
However, Facebook might be moving back toward that original vision — according to a recent report at Business Insider, Facebook is experimenting with a classifieds system.
With its extensive data on more than 1 billion users across the world, Facebook could see plenty of traction; not to mention, a classifieds system would be another way to help boost mobile revenues. According to Business Insider, “The ads would charge people a small fee for prominent placement in friends’ news feeds.”
Should Craigslist be worried? No — at least not right away, considering the company has a great brand in its niche. But if Facebook can get its users in the habit of placing classifieds, it could be a growing problem for Craigslist down the long term.
Tom Taulli runs the InvestorPlace blog IPOPlaybook, a site dedicated to the hottest news and rumors about initial public offerings. He is also the author of “How to Create the Next Facebook.“ 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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