My pet project the last six months has been to learn everything I can about Facebook (FB) advertising. Let me explain why I chose that specific niche.
I decided last year that it would be counter-productive to try and master the understanding of too many areas of technology. Between industry areas like big data, cloud computing, artificial intelligence and robotics there are hundreds of companies with dozens of different business models and customers.
After looking at those four related areas, I also decided that the best way to conquer the investment puzzle would be to simply buy the four most important players who will likely dictate the future markets for those technologies. Those four companies I profiled in my June Zacks Confidential report Big Economic Disruption: Big Data, AI, & Robotics .
They were Alphabet (GOOGL), Amazon (AMZN), Microsoft (MSFT), and IBM. To me, keep it simple and just own the powerhouses who were already investing heavily in those areas, while also busy swallowing up advanced tech and startups before the other guy.
And the competition is heated as tech titans clash with war chests of cash. A fifth name could have been Cisco (CSCO), the arms dealer for the infrastructure of the Internet. Last month, they plunked down $3.7 billion for a software company that was within days of going public.
You can read about that "buzzer beater" in my January 27 article Cisco Snatches IPO Baby from the Arms of Wall Street .
Why Facebook Advertising?
So with all this "battle of the tech titans" going on, why settle on the boring niche of FB ads? Two reasons: first, it was easier to understand and more tangible than all the different things Google, Amazon, Microsoft, and IBM were doing. And second, something explosive and fascinating occurred last year in Facebook when they grew ad revenue to $26.5 billion, representing 55% annual growth.
I wanted to know what was driving that growth. And I was very intrigued to find it was a whole new world of marketing and sales freedom for small and medium-sized businesses around the world.
Giving access to the little guy to advertising power that formerly belonged only to big corporations didn't just steal market share from the pie that Google Adwords had baked in the past decade.
It created a much bigger pie altogether as local businesses, online marketers, and digital nomads found magic in the FB Power Editor to target ad campaigns, audiences and even their ad budgets.
Study SaaSy Sales
The universe of technology is changing exponentially. Disruption is the norm for most industries. But one way to keep it interesting and engaging is to pick a software company and learn more about their business, customers and vendors.
In the video that accompanies this article, I show a jungle of companies and industries related to SaaS (software-as-a-service) providers and cloud computing.
Along the theme of marketing and sales "SaaS for the little guy," ala Facebook, I really like the business model of HubSpot (HUBS) who claims to have invented "inbound" marketing solutions where leads are generated online and then nurtured through email campaigns to eventually drive customer conversions.
HUBS offers a free CRM to lure clients in. And speaking of CRM, be sure to watch my video where I tell the story of the war of words between Microsoft CEO Satya Nadella and Salesforce.com CEO Marc Benioff over the former's bid for LinkedIn.
A private competitor in this space is Infusionsoft. You have probably noticed a link or two from an email, landing page or autoresponder that was being driven by Infusionsoft.
Getting Giggy Too
And some of the most exciting companies to study are those involved with services in the "sharing" or "gig" economy.
While Angie's List invented the model 20 years ago, and CraigsList keeps it "underground," plenty of money is being invested by VC in new freelancer portals like Upwork, TaskRabbit, and Thumbtack.
Thumbtack raised over $200 million in 2015 from Google Ventures and Sequoia. And just this year, Australia's Airtasker nailed a Series B funding round worth $23 million.
Be sure to watch my video to get more details on all these industries and trends. I've got some great graphics with hundreds of companies listed.