IPOs change businesses. Imperatives and pressures change; new cash facilitates new initiatives. This means new strategic business models are called for that inevitably impact upon the brand.
We can look at the example of Google: it was conceived as a simple search engine, and a very successful one, but its growth was based upon the recognition it could do more. Ambitions lead to plans, and finance allows these to be put into practice. However, as Google showed, the original concept, the search engine model, was only a tiny part of the story. New developments and acquisitions strengthened and enhanced the business model, but key to growth was the powerful brand.
Of course, the brand is not just part of the mix, it is central to it. As the brand provides a platform for growth so it is affected by that growth and its values are modified.
We can just start to observe the wider ambitions of Facebook. The brand is embedded in a strong emotional attachment of a user base that identifies with the brand values. That has been evidenced by the numbers prepared to take up a slice of the IPO where pragmatic investors were perhaps more sceptical.
The business will have to develop as it needs to monetize its strategy – a strategy that still seems a little unclear. There is perhaps every chance that it will follow the Microsoft route of growth by acquisition of complimentary, innovative businesses.
One danger is the ‘tall-poppy’ syndrome that affected Microsoft and Google, and more recently, Apple to some extent.
The Facebook brand, more than these other examples, depends upon the loyalty and emotional engagement of its user base. It has in the past displayed an almost autistic lack of empathy. Hopefully the steadying influence of more shareholders and a diverse board will build sympathetic brand strategies.
There is nothing that Facebook does now which is particularly special. Indeed, it could be argued that other social networks perform those tasks even better. But it is the massive user base, the unique position of being among the first to market and the amazing loyalty that combine to deliver the brand strengths. These are so dependent upon emotional attachment that very sensitive direction will be needed if this user base is to be kept on side.
Let us hope that we see a sympathetic recognition of these brand strengths as the business evolves in the grownup world.