Observation on making profits from “nothing” like Facebook

Observation on making profits from “nothing” like Facebook

May 29th, 2008 1 Comment

The answer to the age old question “how can I make money from nothing?” is usually “it’s impossible.” Which, logically, I guess is correct. But in business, maximizing profits and revenues from a pre-existing product or service is key, and it’s something Facebook has impressed me with the past few months.

Facebook example

I’m assuming most e

veryone reading this is familiar with the growing social networking site that is Facebook. com, so I won’t insult your intelligence with background info.

To the example: Facebook has recently offered free gifts that members can give to other friends. Normally, gifts cost like a buck to send to friends, so this free gift is something a lot of people are excited about. So recently, the free gift was the gift of a Sunkist can of pop.

Simply genius in my opinion. Why if you haven’t figured it out yet?

Facebooks creates value in a “nothing” or made up product by charging $1 for this profile eye candy.
Facebook creates hype and excitement among its members by offering these sweet profile gifts for free.
Facebook charges Sunkist bundles of money to offer its products as gifts for free.
People give these gifts, and on basically everyone’s homepage in the entire Facebook network, there will be a news feed notifying them that one of their friends sent / received one of these Free gifts of Sunkist pop.

They’ve been at this for awhile, so this post is a little overdue. Because I remember one case a couple months ago where a Dr. Pepper can was free.

But the lesson from this? Find creative ways to create value in “nothings” and sell them or give them away (if ad supported). I hope to one day find a large real world application of this same concept. In the meanwhile, I will continue to give kudos to innovative thinkers like Facebook.

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