Facebook Hits 500 Million Active Users

  |  July 21, 2010   |  Comments

From a marketing standpoint, Facebook's stunning audience growth means the site has become a channel unto itself.

Five-hundred million's an awful big number.

It's the world's population divided by 14. It's the approximate number of people living in European Union countries. It's the combined population of Latin America, minus Columbia and Argentina.

It's also the number of global active users on Facebook as of this morning, the company made known in a video and blog post today. The milestone was widely anticipated this week, but is no less stunning for having been predicted.

The company now ranks fourth among global Web properties in terms of unique users, according to comScore. It still lags behind Google (932 million), which will likely be the first Web company to reach 1 billion monthly users, as well as Microsoft (789 million) and Yahoo (622 million). However Facebook's estimated annual growth rate - 73 percent - eclipses all of those sites. (Since comScore captures visitors who are not registered, its estimates skew higher than Facebook's internal numbers.)

From a marketing standpoint, Facebook's stunning audience growth means the site has become a channel unto itself, spawning agency practice areas and a thousand branded community initiatives. Its self-serve ad tools have been adopted widely, if unevenly, so that by virtue of sheer impression volume the company's revenue has begun to skyrocket. In a recent interview with Inside Facebook, CEO Mark Zuckerberg called estimates that the company would rake in up to $1.1 billion in ad revenue this year "not so far off."

To celebrate its audience milestone, Facebook has rolled out a new app/marketing initiative to let users share their experiences with Facebook. Visitors to Facebook Stories can read the experiences of others who have used Facebook to rekindle old flames, advocate for community issues, or, in the words of one user, "pointlessly and effectively waste my time."

Not surprisingly, among the stories are some involving brands that have used the site to connect to prospects and customers.

"Thanks to Facebook, the company I work for has been able to build a growing community of friends and fans - not just customers," wrote one. "We've been able to reach more people, get more feedback, and grow as a brand. I'm really excited about being part of this process."

The site is also clearly intended to help buff Facebook's image after an undeniable rough patch. This past spring the company endured what may be the most sustained privacy-related criticism that any Web site has ever been subject to. Partly as a result of that episode, it now suffers from extremely low satisfaction rates among its users.

That's according to the 2010 American Customer Satisfaction Index (ACSI) E-Business Report, produced in partnership with ForeSee Results. According to the report, Facebook scored an abysmal 64 on a 100-point scale, placing it in the bottom 5 percent of private sector businesses - lower even than IRS's e-file system. It also came in well behind Google, Bing, and Wikipedia - though ahead of MySpace.

Companies that score higher in ASCI ratings have been shown in many cases to perform better in stock markets, a fact that would appear to bode ill for Facebook - that is, until you look at the exceptions to that rule. Those exceptions, according to a spokesperson for Foresee, are industries that have little consumer choice - such as airlines and utilities. In such categories, companies can often succeed despite a poor ASCI score.

Whether social media will turn out to be such a category remains to be seen. The time and mental energy required to join a new social platform remains a barrier to entry for many upstart social media platforms, which for now appears to be deterring would-be rivals from launching a viable challenge to the site. However there are still countries - most notably Japan, Russia, China, and Korea - where Facebook is not the leading social network.

For Zuckerberg, converting those country's Internet populations to his way of thinking is just a matter of time.

"It tips at different countries at different times," Zuckerberg told an audience at the Cannes Lions ad festival last month. On the question of whether Facebook would crack a billion users, he said "it is almost a guarantee that it will happen."

Follow Zachary Rodgers on Twitter at @zachrodgers.

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Zachary Rodgers

Until March 2012, Zach Rodgers was managing editor of ClickZ's award-winning coverage of news and trends in digital marketing. He reported on the rise of web companies, data markets, ad technologies, and government Internet policy, among other subjects. 

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