As Facebook use drops, should brands be concerned?
Monday, February 26, 2018
For the first time, a third-party research firm found the number of Americans currently using Facebook is down. In 2018, only 62 percent of people are using Facebook, down from 67 percent last year.
A 5 percent change is nothing to sneeze at. According to this study, the last time Facebook experienced this big of a user swing was back in 2010 — when usage jumped from 41 to 51 percent.
This number doesn't stand alone either. Facebook just announced their 2017 Q4 earnings, and the company only gained 2.18 percent more daily users. That's the lowest quarter-over-quarter percentage daily user growth ever reported by the company.
In light of all this, Facebook also recently announced one of the most significant changes to its algorithm. Mark Zuckerberg, Facebook's founder and CEO, framed this as a way to put the emphasis back on friends, family and community. If we use social media to connect with those we care about, it can be good for us. But when we act passively (or compare ourselves), social media takes a toll on mental health.
His explanation seemed a bit too "Kumbaya" for some. Others saw it as a revenue grab since businesses, brands and media outlets would have to pay more just to reach their current audience.
But maybe there's another more straightforward answer: Zuckerberg and the Facebook team saw the writing on the wall. Usage was down. Growth was lackluster. People weren't happy with Facebook, so the company had to pivot.
Let's look at the top three problems plaguing Facebook:
1. People aren't sharing.
From 2014 to 2015, original sharing (posting about your personal experience instead of linking to an article) dropped 21 percent. From 2015 to 2016, it again fell 15 percent, according to reports by The Information.
As original sharing plummeted, messaging apps skyrocketed. Instead of broadcasting information, people chose to have one-on-one conversations.
2. There's less of the content people prefer.
In Q4 of 2017, Facebook began making changes to deliver an active user experience. Specifically, Facebook showed fewer viral videos in its News Feed, among other similar changes.
As a result, each user spent, on average, 2.14 minutes less per day on Facebook. That's a 5 percent reduction of total time spent on Facebook.
3. It's filled with ads.
From 2016 to 2017, Facebook made 47 percent more revenue. Facebook's revenue growth has been at or above 39 percent growth since Q2 of 2014. But it is now so chock-full of ads that Facebook has begun warning its investors that the company is running out of ad space in the News Feed.
More ads typically diminish user experience. That's especially true for millennials and Gen Z — 56 percent of whom cut back or stopped using social media directly because of the advertisements, found a 2016 Harris Poll Study.
"I go on social media to see and know what my friends are doing. I don't want to see ads clutter my news feed," 23-year-old recent graduate Mallory Benham said. "Social media is a place for us to connect with our friends, not be attacked by advertisements."
Despite all this, Facebook is still the largest social platform out there, and even if fewer people are on it, the average U.S. user still spends at least 35 minutes a day there.
In short, Facebook remains one of the best places for you to connect with your consumers. But keep monitoring these trends and shifts to determine their long-term impact.
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