Facebook: this is how Zuckerberg wants to save his favorite project

Facebook: this is how Zuckerberg wants to save his favorite project "Metaverse"

Social media giant Facebook on Monday released new record figures for third-quarter ad revenue. The Group was able to achieve almost $ 29 billion with online advertising, over 35 percent more than in the same period last year. Facebook earned over $9.1 billion over the past three months. But the good figures are overshadowed by a whole series of revelations from documents of a whistleblower, which put the top management under pressure. Since Monday, tech media and US newspapers have been bringing new analyses from a treasure trove of documents that ex-Facebook manager Frances Haugen copied from the company’s network.

Facebook CEO Mark Zuckerberg used the presentation of the quarterly figures for a flaming defense of his group against the reports. “We see a coordinated effort to selectively use leaked documents to paint a false picture of our company.” In reality, Zuckerberg said, Facebook is making every effort to solve the problems, “because it is important to us to do this right.“

Facebook’s internal discussion forums are intended to show that the company’s executives have long been aware that hate speech and propaganda on Facebook’s pages have gotten out of control. Especially in India, North Africa and Asia, language barriers overwhelm the automatic controls in the system. Facebook whistleblower Sophie Zhang has already reported that Facebook’s leadership is ignoring the problems in the emerging markets and focusing the use of “real” moderators on the core markets in Europe and the USA.

According to an internal report, the team for Yemen, for example, lacks employees who speak Yemeni Arabic, while in India there is a lack of native speakers of Hindi and Bengali accents. In addition, tests by US media showed that new users in India are being flooded with pro-government propaganda. The impression is growing that Facebook’s CEO Mark Zuckerberg puts growth before user safety in case of doubt.

All this is now being pulled through the media every day, analyzed, evaluated, commented on – until the Facebook Group communication also runs out of ideas. There has long been a kind of wagon-castle mentality there, the blog posts of Group spokesman Nick Clegg are becoming increasingly defensive. The British ex-Deputy Prime Minister is currently the only top manager besides Zuckerberg who regularly ventures into the public and defends the group.

“Whatsapp and Instagram are becoming more independent”

From a Group point of view, a kind of communicative all-round turnaround is therefore due. Something that distracts from the constant revelations and redefines it to the problem of only one corporate brand of several. According to the US tech magazine Verge, Facebook’s top management is planning to completely rename the group in a radical step. The change could be announced at the Facebook Connect conference on October 28, US analysts are currently speculating. But at least during the analyst talk with Zuckerberg after the presentation of the quarterly figures on Monday, there was no talk of a new appointment.

If the rumor is true, if the group really wants to give itself a new identity, a restructuring is due at the same time, experts advise. The idea comes directly from the treasure trove of strategic brand management, explains Christoph Burmann, Professor of brand management at the University of Bremen: “Google has already demonstrated how this works: you change the group structure and create a new umbrella brand, in Google’s case with the art name ‘Alphabet’. This makes the problems of the social network an issue that only affects one part of the group directly. The highly successful subsidiary brands Whatsapp and Instagram are becoming more independent.“

In particular, the new name, Verge reports, should create communicative scope for the project that Facebook CEO Zuckerberg is currently most interested in: he wants to create a kind of digital parallel world that can be experienced by users via virtual reality equipment, the so-called “metaverse”.

Facebook’s annual profit from the core business could be up to ten billion dollars lower for the 2021 financial year, according to the announcement, as Facebook is setting up its virtual reality division “Facebook Reality Labs” as a separate group segment and investing billions in research and development for the Metaverse.

So maybe only this division will get an independent identity with a distance to Facebook’s core brand in order to get off to an unencumbered start. Zuckerberg brought the basic technology for this into his company years ago with the acquisition of the VR company Oculus and constantly developed it further. Now the next step could follow.

The goal of the “Metaverse” is currently in the eye of various US tech companies, in addition to Facebook, Epic Games is currently perhaps the closest. For Facebook to become the leading brand in the VR business and, in particular, to overtake Epic’s “Fortnite” universe, Zuckerberg needs to get rid of the bad taste of “Facebook”.

The documents from Frances Haugen’s treasure chest show that especially young users under 30 – the main target group of the Metaverse – are increasingly turning away from Facebook. The market penetration among young people and young adults has already fallen by 19 percent, according to the documents, which were also made available to the US Congress. “External forces such as negative media coverage continue to cloud this perception and are tantamount to a brand tax, which we must prevent,” the documents say.

In an interview with the analysts, Zuckerberg also announced that all the group’s offers would be more tailored to the target group of young adults between the ages of 18 and 29, “instead of optimizing for a larger number of older people”. The needs of the younger target group should become the “guiding star” for development. Facebook Instagram’s core brands include a concentration on short video formats, which competitors such as Tiktok are currently successful with, but also the billion-dollar investment in the Metaverse.

“Restart unencumbered by Facebook’s problems”

All of the Group’s VR content is already aimed primarily at the target group of younger computer gamers. But Facebook protested loudly when Facebook forcibly linked the login to the VR gaming platform “Oculus” to a Facebook account in August 2020. So if the target group does not feel like “login with Facebook”, a new name must be given.

“A new content such as the Metaverse project would start with a new umbrella brand, communicatively unencumbered by Facebook’s problems,” explains brand strategist Burmann, “the project would be taken out of the firing line to a certain extent. From the point of view of the stock exchange, this also makes sense, a new group name would no longer be associated with Facebook alone from an investor’s point of view, but also stands for the potential of the new project.“

However, if the renaming does not also bring a new corporate structure with an umbrella brand and many sub-brands at the same time, so if Facebook renames the Metaverse project for cosmetic reasons alone, then the rebranding project would be doomed to failure, Burmann continues: “If you just want to distract from the criticism, then it does not make sense. Everyone will notice that, then you also generate negative publicity with it.“

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