How Facebook Makes Inroads In The Developing World

In emerging markets just beginning to come online, Facebook is a gateway to the Internet. Chris Daniels, VP of business development, reveals what Facebook is learning about brand-new mobile consumers.

Chris Daniels will never forget the day he had to buy a car in Zambia.

It was 1993, and Daniels was high-school age. Though Daniels grew up in Vienna, Virginia, he spent part of that year working for his mother, who ran a World Bank-sponsored entrepreneurship-development project in the East African country. And on this day, Daniels--now the VP of business development at Facebook--was sent to buy a car in Lusaka, the capital.

In Zambia back then, the highest bank note you could get was for 500 Zambian kwacha--a sum worth around 70 cents at the time. And you could only buy a car in cash. “To buy a car in Zambia, you’d go to the bank in the morning, fill duffels full of cash, go across town to the car dealership, and purchase the car with the duffels of cash,” Daniels recalls. The process took a day, because all the money had to be counted. “I remember the monotony of putting every single bundle of 500 kwacha bills through the machine, hearing them flip through, then doing it over and over.” It was a day wasted--"for me, for the dealership, and for the bank,” says Daniels. He couldn’t help but think, If there were better banking here, and technology to support it, “people could be more productive and live better lives.”

Chris Daniels

Now, at Facebook, Daniels feels he’s doing just that--bringing the technology to help people live better lives around the world. A central pillar of Daniels’s job is to work together with cellular carriers around the world, to help the next few billions of people to come online. “1.19 billion monthly active users, that’s a lot of people,” says Daniels, citing Facebook’s current numbers. “But when you consider there are another 8 or 9 billion out there, there’s a lot of work left to do.”

Over the past few months, Facebook has announced new partnerships with two carriers, Globe in the Philippines and Tigo in Paraguay, partly the fruits of Daniels’s travels and negotiations. He’s been to the Philippines, Singapore, Indonesia, South Africa, and to Europe just in the past few months.

Depending on where a country is in its evolution towards connectivity, the needs of the market may be vastly different, he says. In the Philippines, for instance, 80% of the country still uses feature phones. Since many in the country live from paycheck to paycheck, they’ll buy chunks of data throughout the month rather than pay a monthly fee for broader access. Yet even as they earn more money, these consumers’ behaviors are often entrenched. A carrier like Globe, then, is asking itself questions like, “How do we get people to become habitual data users?” and “How do we get people to update to Android from their current phones?” says Daniels.

So Globe and Facebook struck up a partnership that the two deem mutually beneficial, as well as good for consumers. In many parts of the world, says Daniels, more people claim to want “Facebook” than “the Internet." The latter is sometimes a fuzzy concept to them, but they are familiar with the Facebook brand and intuitively understand the idea of socializing online. Capitalizing on this brand recognition, some international carriers offer free use of Facebook over their networks, meaning a Filipino consumer can browse the social network freely without eating up data. When they click on a link to explore the Internet at large, Facebook delivers a message explaining that they’re free to do so--if they buy a data plan from the carrier.

For people in the developing world, “Facebook is an on-ramp to the Internet,” says Daniels.

This component of Daniels's job goes hand in hand with a relatively new initiative spun out of Facebook. Internet.org is a collaboration between Facebook and other corporate partners to help drive digital penetration for the next 5 billion people--making access to data more affordable and finding business models that allow connectivity to surge across the digital divide. “A lot of the work that myself and my team do is in the spirit of and contributes to Internet.org,” explains Daniels.

Zuckerberg and Daniels claim an altruistic motive behind Internet.org and Facebook’s international exploits, saying the company’s mission is to make the world more open and connected. There’s inevitably a business case, too, to make sure that Facebook is a beneficiary of that connectivity. Though Facebook’s global social-networking reign seems all but unstoppable, it’s worth remembering that new markets, where local tastes and first-mover advantages can be influential, are idiosyncratic. For instance, in Peru, Inca Kola remains a stronghold against Coca-Cola’s global conquest. Daniels points to Russia’s VK.com as a viable competitor to Facebook in some parts of the world.

But his global travels can’t help but reassure Daniels of Facebook’s prominence. In Indonesia, Daniels saw the Facebook logo posted on storefronts just about as often as he’d seen the Coke logo in Zambia 20 years ago. Many stores don’t have web presences apart from their Facebook page.

It all serves to remind him of how far emerging markets have come since the time he spent in Zambia. In a rural corner of the Philippines, he recently tested out how difficult it would be to buy a phone and data plan and to get Facebook up and running. He feared a laborious process, along the lines of his Zambian car purchase all those years ago.

He needn't have feared. He was up and running in a matter of minutes. “Outside of Manila, in a relatively rural village, it’s actually really easy to buy a phone and get Facebook up and running,” he muses. “That’s awesome.”

[Image: Flickr user Julie Louisa Hagenbuch]

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1 Comments

  • LV Voice

    Zambia is NOT an East African country, it is in Southern Africa. A single googling would have verified the actual location. It's like saying Nebraska is on the East Coast.