Will Facebook Marketing Be Relevant In 2015?
Monday, April 28, 2014
A recent study done by researchers at Princeton University suggests that Facebook will experience a rapid decline in activity over the next few years.
The research, which compares the lifecycle of popular social networking sites to the lifecycle of diseases, suggests Facebook has already reached its peak, and has actually already entered its decline phase.
They write, “Extrapolating the best fit into the future shows that Facebook is expected to undergo rapid decline in the upcoming years, shrinking to 20% of its maximum size by December 2014.” They go on to say in the study’s conclusion that Facebook can expect to lose 80% of its user base between 2015 and 2017.
While the validity of this research is definitely under scrutiny, it does bring to mind some important questions: Will Facebook marketing still be relevant in the coming years? Assuming the Princeton study doesn’t hold water and that Facebook’s numbers do remain relatively stable, how many marketers will continue to rely on the platform as part of their social media strategy?
Let’s take a look at some of the most common concerns and trends marketers are reporting in terms of their marketing efforts on Facebook.
There has been a great deal of pushback from marketers after Facebook admitted that marketers are increasingly going to have to pay for reach. In a sales deck sent out to its partners, the company stated: “We expect organic distribution of an individual page’s posts to gradually decline over time as we continually work to make sure people have a meaningful experience on the site.”
And research carried out by Ignite Social Media in December 2013 seems to confirm this decline in reach: After reviewing 689 posts across 21 brand pages, they found an average decline in organic reach by 44%, and up to an 88% decline on some pages. Only one page showed an increased reach (5.6%).
The company also suggests that the average post only reaches approximately 2.5% of fans, which differs significantly from Facebook’s previous claims of 16%. Furthermore, multiple claims have arisen that Facebook ads are resulting in fake “likes” to company pages, stirring up debate about whether Facebook is deliberately allowing this to happen in order to increase profits.
How long will marketers stand for this? And how will Facebook respond to the pushback from disgruntled business owners and marketers?
Facebook Advertising Doesn’t Appear to be in Decline
With all this talk about Facebook being on the decline, it would follow that advertisers would be minimizing their spending on Facebook ads, and/or be reporting declining results for Facebook ads. The data doesn’t seem to support this theory, however.
Take a look at these recent statistics:
In October 2013, retailers on Facebook reported seeing a 152% ROI for the first 9 months of the year.
Retailers reported an 83% increase in RPC (Revenue-per-click) over the same period in 2012.
Facebook experienced record highs in terms of ad clicks and click-through-rates in the last quarter of 2013; in fact, CTR’s were up 365% over Q4 2012.
Facebook’s ad revenue increased from $1.8 billion in Q3 2013 to $2.34 billion in Q4
And perhaps most significantly, advertising revenue was up 76% over the same quarter in 2012.
Facebook advertising appears to be strong, and is showing no signs of decline. Although the need for marketers to pay for reach certainly contributes to some of the increased ad spending noted above, this doesn’t account for the increases in ROI or RPC that have been demonstrated.
Marketers Looking to Reach the Teen Market Will Need to Look Elsewhere
It’s been clear for a while that Facebook is rapidly losing the teen market; in fact, one analyst recently estimated that Facebook has lost more than 11 million teens since 2011.
While Zuckerberg originally denied a decline in the use of Facebook by the teen market, the company did admit the decrease several months later. During the company’s 3rd quarter earnings conference call, CFO David Ebersman admitted, “We did see a decrease in [teenage] daily users [during the quarter], especially younger teens.”
With younger users increasingly turning to video and photo-sharing networks like Snapchat, WeChat, Vine and Instagram, marketers will need to change up their current strategies to incorporate these platforms.
While the commentary above may appear to paint a grim picture of the future of Facebook, I don’t see the social behemoth going anywhere soon; however, they will need to address the challenges noted above if they want to hold onto their market share. In my view, marketers are happy to remain loyal to the platform, so long as issues related to post reach and teen engagement are sufficiently addressed.