The Digital Lookout

Neilsen/Netrankings has released some figures which show a monthly decline in Facebook users for the first time since its launch, before it has even managed to fully leverage its traffic volumes into advertising sales.  Its unique audience dropped 5% from December to January prompting many people predicting the demise and claiming Facebook is a fad which will go away as quickly as it arrived.  Have people really already become Facebored?  Or is it simply inevitable that sooner or later there would be a dip in audience as the users who created an account “just to see what all the fuss is about” disappear back to their own world grumbling that it was a load of rubbish anyway?

Mark Ritson, in his article for Marketing, blames the decline on Facebook’s open door policy.  Since September 2006 Facebook has allowed anybody with a valid email address access to their network which was previously exclusive to US students (and before that just Harvard students).  This is where the influx began and over the last 18 months its user base has just grown and grown, until now!  Ritson uses the analogy of being in a hyper trendy bar with his friend, surrounded by beautiful people, drinking beautiful cocktails, listening to great music, before realising the only thing which spoilt the bar, was them!  Two middle aged blokes with expanding waistlines stood out like a sore thumb and somehow made the place less cool.  By opening its doors to anybody in the world, he argues, Facebook has made itself less cool and exclusive, and the seriously cool people, aren’t going to want to be sent a friend request from their mum or an old school teacher!  They want to hang out in a cool environment which similarly cool people, doing cool things and just generally being cool.

So has Facebook’s open door policy caused this dip and is it to be the demise of the worlds largest social networking site?  I don’t know, but I can say that my usage habits have changed slightly since I added my mum and dad as friends!  I am now a lot more careful about what I post and where I post it, although that doesn’t really change the experience too much.  Personally I would blame the 5% drop on the part time users departing, there had to be a dip at some point and I’m sure that’s how the guys at Facebook will see it. 

What it does say to me is that Facebook need to get their act in gear and make this thing profitable, they have an advertising model in place now should start to reap the rewards but it is still not the finished article.  I feel for them in that they are trying to be innovative and make their ads as unintrusive a possible and this is difficult to do but they must find a way.  They have already been chastised for their beacon system and they probably cant afford another mistake like that.  I just hope for their sake, that they don’t rue missing out on a  slice of their $15 Billion valuation which could start to decline a lot faster than their user base if next months figures aren’t more positive.

It is the social networking phenomenon which has taken 2007 by storm but I have started getting a little bored with Facebook of late.  Now that the thrill of connecting with old friends has passed and the days of logging in to a potful of notifications is behind me I’m struggling to get excited by it all.  All I seem to get these days or invitations to join the latest application doing the rounds and numerous postings of those annoying chain letter style messages (for the last time, nothing bad is going to happen if you don’t pass it on, no-one is going to delete your profile and you aren’t going to come into any money!).  There are a few friends who I contact through it which make the process of logging in worth while but aside from that its all a little dull for me now.  Maybe I am alone in this feeling? I know for a fact many of my close friends are still wildly addicted to it and if they go a day without logging on they start breaking into cold sweats and having panic attacks.  But I just don’t get that feeling of anticipation when logging in anymore.  Sure, I still use it, but more out of habit than enjoyment and also the fact I use the internet all day everyday at work so have access all the time.  I certainly wouldn’t be too worried if I had to go with access for a period of time though and can’t see Id miss it at all.  Maybe this is the start of the great Facebook decline, where the casual user drifts away and only the hardcore remain, leaving thousands of redundant accounts.  This is how I see Myspace’s current existence, I haven’t seen their take up figures recently but I would imagine they are in sharp decline, part due to the rise of Facebook but also because they are no longer the flavour of the month and only the hardcore survive.  Facebook is a long way from this status as they are still in the stage of sign up growth but they need to keep one eye on the future and think about how to avoid the decline, either that or get out while the going is good.  As they say, timing is everything, but I doubt they will ever be valued at more than the current $15 billion so it may be time to cash in.