There is plenty to talk about with Facebook (or should we say Meta) recently. Whistleblowers, court cases, a rebrand and a push into exciting frontiers of technology. Yet, the most important story about Facebook may not be getting much attention. It is something many of us realise, and likely have spoken about with our family and friends – people are not using Facebook as much as they used to. This is the problem at Facebook’s core. This is the reason they acquired Instagram and WhatsApp in the early 2010’s. This is the reason they made a big push into eCommerce in the late 2010’s. This is the reason they are pushing hard into the metaverse in the early 2020’s. Social media can be a fickle business. And if you’re losing your audience to newer or ‘cooler’ platforms, the question becomes, what’s next?
Here are some of the stats that Facebook were internally reviewing (and that have since been leaked). Account registrations for users under 18 were down 26% from the previous year in the Facebook app’s top 5 countries. Teenage usage of the Facebook app in the US had dropped 13% since 2019 and was projected to drop 45% over the next two years. Messages sent by teens were down 16% from the previous year. Users between 20 and 30 were expected to drop 4% over the next two years. For these age groups, their session time and frequency was less than older generations. The message was clear – Facebook was losing traction with the younger generation, fast.
The data is less stark on Instagram, despite Facebook’s internal data starting to see slightly less engagement from teen users – for example, posting by teens dropped 13% from 2020. Instagram remains the most popular platform for young people and will for the foreseeable future. However, Facebook’s market research suggests teenagers spend 2-3x more time on TikTok than Instagram and when surveyed suggest that Snapchat is their preferred platform to communicate with friends.
Recent moves from Facebook need to be understood in this context. The early 2010’s playbook of buy the app the young people are using is no longer available to Facebook. So in the late 2010’s, they used their platform dominance to move into a key adjacency – eCommerce. But that hasn’t brought young people back onto the platform, so now we’re seeing the next move from Facebook – the metaverse. Facebook may be right about this bet. They may be able to take their huge number of users, forge great hardware partnerships (e.g. glasses with RayBan) and succeed in becoming the platform upon which the metaverse is built. Or they may not, and they may keep losing the next generation of users to their competition.
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