With Facebook, Inc. stocks tumbling, many question the longevity of the social media king and how it will be able to continue to create ad revenue. More and more users are accessing their Facebook profiles on mobile phones, which don’t show the multitude of ads. This means Facebook needs to get creative to stay relevant.
A recent study in the UK by DMA found that 44% of respondents regard marketing on mobile social media as invasive, and 52% believe that ads should only be seen by fans or followers of brands.
During a recent appearance on CNBC’s “Squawk on the Street” program, Eric Jackson, founder of Ironfire Capital, said that Facebook will lose its spot at the top in a relatively short amount of time. Jackson cited Facebook’s inability to crack the mobile market and the stock’s nosedive since the company’s IPO.
“In five to eight years they are going to disappear in the way that Yahoo has disappeared,” Jackson said. “Yahoo is still making money, it’s still profitable, still has 13,000 employees working for it. But it’s 10 percent of the value that it was at the height of 2000. For all intents and purposes, it has disappeared.”
A recent poll from Reuters and Ipsos found that 34% of Facebook users are already logging into the site less frequently than they did six months ago. But almost half spend around the same amount of time, and 20% are spending more time. Keeping users coming back is crucial for all social media services, said Gartner analyst Ray Valdes.
“Facebook continuously has the challenge of Facebook fatigue, of the novelty factor wearing off, and therefore they have to introduce new kinds of interaction,” said Valdes, citing new features such as the “Timeline” interface and the planned $1 billion acquisition of mobile photo-sharing app Instagram.
Technology changes so quickly and Facebook will need to change in order to keep up. What do you think? Are you open to Facebook ads on your smartphone?
