Research Portfolio on Facebook's Current Strategic Positioning and its Proposed Venture into Crypt-Currency

            It is important for every business firm to know how crucial there strategic positioning can be to get competitive advantages. Strategic positioning is a concept, which is concerned with the decisions made by a company to create value through its business and then determine how that particular value will be better than its competitors. It means that one firm distinguishes from the other on the basis of its strategic positioning. One great value is created, then it is delivered to different segments of customers to satisfy their needs. It is important to understand that strategic positioning will always be concerned with the external environment of the organization; an environment, where it operates with other competitors. Keeping an eye on the external environment and other entities, a business firm can make valuable choices in selecting resources to determine their position in that particular industry or market (Dugal & Schroeder, 2015). It means that it is also vital for Facebook to realize the fact that what their current strategic positioning is and how they are able to deliver value with the help of this strategic positioning. They have strategic positioning, where they believe in growth strategies to compete with other social media platforms on the basis of accessibility and efficiency (GREENSPAN, 2018). The purpose of this paper is to analyze the current strategic positioning of Facebook, and its future venture of entering into the field of cryptocurrency. The paper will analyze both and it will be determined that what factors are important in its external environment, and what barriers will be faced by Facebook, to begin with, this new venture 

Facebook External Environment of Current Strategic Positioning and its Proposed Venture into Crypto-Currency

            The business dynamics in the online field are very diverse and they keep changing with the passage of time. So, Facebook operates in a very competitive and diverse external environment, where things are not easy at all. It is never easy to sustain the value of a business in an external environment, where one has to compete with other business giants like Google, Microsoft, and Yahoo, etc. The existence of such huge business competitors makes life difficult for Facebook, and they have to come up with distinguishing business ideas on a constant basis so that they can compete well, and sometimes stay ahead in the competition. There are various factors, which are crucial for Facebook to determine the value of the business in its external environment, and one of such factors is the demographics of users. If Facebook wants to get more competitive advantages, then they will have to examine their external environment in terms of targeting demographics in a better manner. It has been estimated that display and text ads come up with great business opportunities for Facebook, so they need to focus more on demographics to create more value. Facebook also challenging Google in terms of search activity, and it can be their new business value in the coming years (Forbes, 2011)

            It is also essential to know that PESTEL analysis is an important tool to have a look at the external environment of Facebook. Political factors are crucial for Facebook, because when there would be stability in any region, and when there would be strong democracy, the company will enjoy the freedom of speech, otherwise there is an example of China, where Facebook is not allowed to operate. The economic factors are also important because when there would be more business activity, Facebook will have more opportunities to generate more business in the online world. That’s why; Facebook is able to generate good numbers in countries with great economies. Social and technological factors are also crucial for the operation of Facebook in the external environment when society will start using more technology and internet, Facebook will get more business opportunities (Dudovskiy, 2017)

Crypto-Currency Strategic Intent and Positioning and its Proposed Venture

            The advertising business has been the most important one for Facebook, and they have always relied on this business sector. But when other giant competitors are taking other steps to capture more market share, it is important for Facebook to diversify their strategic intent and look for more business opportunities. After the success of Bitcoin in the field of online currency, many companies have seen it as a future business opportunity. So, Facebook has shown the same intent in this regard, because it has been estimated that if Facebook enters in the field of cryptocurrency, they can generate $19b more revenue in the coming years. This number looks to be a huge one and it can change the way the cryptocurrency field is working right now. It has been revealed that Facebook is looking to come up with a cryptocurrency, which can be used for their peer to peer payments (Rooney, 2019). Facebook is seriously considering developing their digital coin and entering into the business of cryptocurrency. That’s why they have developed a team of 50 persons to work on their blockchain technology. So, a serious strategic intent is shown by Facebook and it will be interesting to see how they approach this new business venture. Various other online platforms are also looking to enter into this field, but if Facebook will leap into this field with their digital coin, it will completely change the landscape of cryptocurrency business all over the globe (BARBER, 2019)

Crypto-Currency Barriers to Entry

            Facebook will have to answer any questions before launching their cryptocurrency and it has been revealed that the name of the currency will be Libra. It is certainly a great idea initiated by Facebook, but an important question to answer is that if they are the right company to do so. Some may say “yes, Facebook can certainly make great penetration in this cryptocurrency field as they have so many resources, skills, and capabilities. They are also well-known company all around the world have used by billions of users. So, it is a great idea for them to initiate their digital currency, which will give them new business growth opportunities, and it will also throw new challenges to Facebook’s competitors. But Facebook has to ensure that they develop a currency with a concrete strategy, where no wrongdoings will happen, and people can feel safe to use their digital coins (Dans, 2019)

            It is a fact that Facebook is a huge organization, and it has resources and technology to develop its own cryptocurrency. So, apparently, it looks that they may have to face low barriers of entry because they have it all to develop new digital coin. When an organization is relatively new, and it does not have good enough resources, then entry into a new field can be difficult. Moreover, cryptocurrency field is not an established one in the sense that it does not have any proper business structure. The famous currency like Bitcoin has been around for years, but it is still lacking to win the confidence of people and businesses because they have a currency, which has no stable value. So, barriers to entry are very low for Facebook, and they can easily penetrate into this field, but they will have to analyze various other important factors. They have resources and technology to build a great digital coin, but a major problem for them is to create its big image as Facebook has all around the world (Indianexpress.com, 2019)

Conclusion on Facebook's Current Strategic Positioning and its Proposed Venture into Crypto-Currency

            After analyzing all relevant factors of Facebook and its strategic positioning, it can be said that their entry into the new business venture of cryptocurrency is a good decision with lots of future considerations. They have low barriers to entry and huge potential to increase their revenue with this new business venture. It is a fact that a new business venture will always come up with few risks as well, but these risks faced by Facebook are not too scary, so they can continue developing Libra as their digital coin, and launches it to gain more share and revenues.

 References of Bibliography of Facebook's Current Strategic Positioning and its Proposed Venture into Crypto-Currency

BARBER, G. (2019). WHAT'S THE VALUE OF A FACEBOOK CRYPTO COIN? Retrieved August 19, 2019, from https://www.wired.com/story/whats-value-facebook-cryptocoin/

Dans, E. (2019). Facebook's Cryptocurrency: Great Idea, Wrong Company. Retrieved August 19, 2019, from https://www.forbes.com/sites/enriquedans/2019/06/17/facebooks-cryptocurrency-great-idea-wrong-company/#5f9974392f98

Dudovskiy, J. (2017). Facebook PESTEL Analysis: Two-Way Relationships Between External Factors and Social Media Giant. Retrieved August 19, 2019, from https://research-methodology.net/facebook-pestel-analysis-two-way-relationships-between-external-factors-and-social-media-giant/

Dugal, S. S., & Schroeder, J. E. (2015). Strategic Positioning for Market Entry in Different Technological Environments. Journal of Marketing Theory and Practice, 3 (3), 31-45.

Forbes. (2011). Three Factors Affecting Facebook's $45 Billion Value. Retrieved August 19, 2019, from https://www.forbes.com/sites/greatspeculations/2011/03/14/three-factors-affecting-facebooks-45-billion-value/#b8a2a3c65ed3

GREENSPAN, R. (2018). Facebook Inc.’s Generic Strategy & Intensive Growth Strategies. Retrieved August 19, 2019, from http://panmore.com/facebook-inc-generic-strategy-intensive-growth-strategies

Indianexpress.com. (2019). Facebook’s cryptocurrency will be called Libra, and here’s what it aims to do. Retrieved August 19, 2019, from https://indianexpress.com/article/technology/tech-news-technology/facebooks-crypto-currency-will-be-called-libra-and-heres-what-it-will-offer-5786722/

Rooney, K. (2019). Facebook’s cryptocurrency could be a $19 billion revenue opportunity, Barclays says. Retrieved August 19, 2019, from https://www.cnbc.com/2019/03/11/facebooks-cryptocurrency-could-be-a-19b-revenue-opportunity-barclays-says.html