Maciejak+V+Strategy+Analysis

Maciejak V

TO: Proximity social networking team FROM: Victoria Maciejak DATE: February 20, 2010 SUBJECT: StumbleUpon strategy analysis

We were asked to write a strategy analysis for a social networking company. Here is my StumbleUpon strategy analysis. StumbleUpon doesn't have a sound strategy and doesn't know what direction it is moving in. I would advise Proximity clients to stay away from StumbleUpon.

StumbleUpon is a website that lets its users find and rate different sites, images, and videos.  " It is a personalized recommendation engi ne that uses pe er and social-networking principles " to bring up random pages that it thinks the user will want to see. When the user clicks the "Stumble!" button, the engine brings up pages according to the user's indicated preferences, ratings of previous pages, and the ratings by users with similar interests. (Wikipedia).
 * Profile **

eBay bought StumbleUpon in May of 2007, but on April 13, 2009, eBay sold it back. StumbleUpon made a poor choice in signing on with eBay in the first place, because StumbleUpon has nothing to do with online auctions.

StumbleUpon is mostly free. There are a few paid accounts, called sponsors. These users can disable advertisements. StumbleUpon makes most of its revenue from selling ads. Two percent of the pages that users come across in their stumbles are related advertisements. These are indicated by a green person in the toolbar. StumbleUpon sells ads based on how many users are driven through their site. However, a downloadable toolbar  lets users bypass the site, therefore decreasing site traffic. "In February 2008, the site was at 2.6 million unique visitors. But in February 2009 that number was down to 1.4 million" (Tech Crunch).

StumbleUpon is one of the players in the field of community knowledge sharing. Each "recommendation engine" needs to direct traffic through their site in order to attract advertisers. Major competition includes Reddit and Digg. The main force in the field is the power of the consumers because it is easy for users to switch between social networking sites.
 * Competitive Landscape **


 * StumbleUpon’s Strategy **

StumbleUpon has no clear strategy. It sold and then bought itself from eBay. It has created a way for users to search the web without going through the website. Because of the decreased traffic through the site, StumbleUpon will sell fewer ads and will need to come up with a new way to make money. In an attempt to do this, StumbleUpon has announced that it will be coming up with several new products, including a video StumbleUpon that it hopes will contend with Youtube. Basically, StumbleUpon has a terrible business strategy. It is spreading itself too thin and has no way of generating enough revenue to keep going.


 * Gen Y Implications

StumbleUpon will not last, because they have no sound strategy and no sure way to make money. **It is also very stupid of StumbleUpon to think that it can compete with Youtube, which is the dominant force in user-created video. StumbleUpon is doomed to fail.** I would advise our clients to not get involved with StumbleUpon. **

__Works Cited__ "EBay Dumps StumbleUpon." //Business Insider//. Web. 19 Feb. 2010. . "StumbleUpon Beats Skype In Escaping EBay's Clutches." //TechCrunch//. Web. 19 Feb. 2010. . "StumbleUpon." //Wikipedia, the free encyclopedia//. Web. 19 Feb. 2010. .