Case study Essay Example | Topics and Well Written Essays - 2250 words

Case study - Essay Example Acquisition or alliance is a kind of strategy where a company purchases ownership stakes of another company in order to capture a particular target market. These strategies are also considered as among the pertinent growth strategies of companies in today’s business environment (Sherman, 2010). Many of the companies have come up with such strategies in the recent years. The latest company that has incorporated this strategy is Facebook. The company acquired the stakes of Instagram. It is the company that provides online services such as photo sharing as well as social networking for the users. The company has more than 30 million users worldwide with a total valuation of the firm of around US$20 million. Facebook, a social media giant offered a price of US$1 billion to purchase the stakes of the company. This acquisition will enhance the position of Facebook in front of its competitors, as through the assistance of it the company can provide finest photo sharing experience to its users all around the globe. This is also considered as among the key growth strategies of Facebook (Wharton, 2012; Kosner, 2012; BBC, 2012). This essay will analyse the entire case about the acquisition approach of Facebook and discuss the various threats and opportunities for the company. Furthermore, the essay will also analyse the methods of strategic development and evaluate the ones that will be applicable in Facebook’s acquisition of Instagram. In the later part of the essay, TOWS matrix will be used to analyse the strategic decisions of Facebook and Instagram regarding the acquisition. Strategic Opportunities and Threats of Facebook It can be observed from the analysis of the case study that Facebook will have certain opportunities as well threats as a result of its approach of acquisition of Instagram. There are certain potential benefits for the company. Opportunities It has been determined that owing to the acquisition of Instagram Facebook will strengthen its p osition in front of its major rivals in the market. Acquisition of Instagram will benefit Facebook users quite considerably. Facebook always intended to provide best photo sharing experiences to the customers or users. In this regard, the acquisition will enable the company to accomplish the aforesaid goal as Instagram is capable of delivering best photo sharing experiences for the users. In addition, the applications provided by Instagram will facilitate users of Facebook to leverage instant filters facility, which will be quite unique. This is also among the major opportunities for Facebook. Furthermore, it has been learnt that pictures and images taken from mobile devices appear to be blurred and ordinary. This aspect of photo viewing experience will be completely changed with the inception of the alliance of Facebook with Instagram as the later will enhance the quality of pictures captured and they can also be easily shared. Moreover, pictures taken with the help of cell phones cannot be processed before uploading them to Facebook, but with the help of