What’s more fun than speculating about the demise of major media properties? Ok, maybe a lot of things are but that not going to derail me when I got the blog bug and several tabs worth of data blinking at me.
This may not be brag worthy but, as is evidenced by a post-it note on the corkboard of an old employers wall, I was able to predict the decline of MySpace within three months. I still generally lose in Vegas and am always surprised when that Tahoe suddenly pulls into my lane but, as far as social media properties go, I have a pretty good record.
So how do you define an actual decline? For me, it’s when there are more month-to-month decreases in unique visitors than there are increases over a 12-month span. Since there are a lot of things that can artificially boost traffic, like a major ad campaign or some sort of PR event, I like to focus on trending data over a longer period of time to judge performance. Sure, there are some sites that have bounced back from 12-month trending declines but not in the social space (please correct me here if I’m wrong).
Looking at Facebook over the past 12 months, I think you could say, as Gartner would put it, that they are at the “peak of inflated expectations,” which is the last stage before the “trough of disillusionment” in the Hype Cycle. With the Facebook movie, “The Social Network,” seeing great success and scores of brands shoveling resources at the platform, awareness is through the roof. If you’re not on Facebook, you’re certainly aware of it.
While awareness and mainstream sentiment around the brand are somewhat intangibles, traffic and usage statistics are not. If you look at the Compete data on Facebook over the past 12 months, you see an increase in unique visitors of only about 13%. While in numbers that equates to more than 15 million, it’s not the “hockey stick” growth that Facebook has experienced in previous years, like in 2009 when they claimed their user base climbed 145%.
While the year-over-year traffic is interesting, I’m more concerned with month-to-month data. Even as overall traffic was inching upwards, there were four months in the last year that Facebook actually saw declines. The actual drop in the declining month were never severe and the following month of each period of decline was always met with an increase over the month preceding, which means that overall growth was never eroded.
However, if you look at the bounce-back months, the margins were growing more and more narrow. In December’s Compete data, after a decline in November, the traffic bounced back to only a third of one percent increase over October’s total unique traffic, which can only been seen as flat growth. Don’t trust Compete? Multiple sources reported the same.
Traditionally the fall has always been the highest growth period for Facebook, presumably because students are coming back and making new friends (although growth in the 18-24 year-old demo is currently the weakest and getting weaker), so flat growth over the holidays alone isn’t a clear signal that Facebook is in decline. However, it does suggest some legitimate growing pains.
Ok, prediction time.
I expect that Facebook will see some more growth over the first half of 2011, although the months in decline will be more significant with slightly less pronounced bounce-backs. The third quarter, where Facebook traditionally sees their best growth, will, in my opinion, begin to flatten for the first time in the company’s history. Then in the fourth quarter of 2011, we will see our first signs of legitimate decline in the platform.
So, mark your calendars, I’m calling for the decline of Facebook to begin in Q4 2011. There’s my stake in the ground.
Does that mean that Facebook is over? Aw, hell no.
If you look at the decline of major social networks, there’s no reason to think that Facebook will disappear. Friendster may have fallen fairly quickly, due primarily to massive performance problems and the existence of a viable competitor (MySpace), but that cycle hasn’t necessarily repeated itself. The decline of MySpace has taken much longer and the platform still remains relevant. While in danger of slipping further, MySpace is currently a top 20 online media property in the US and enjoys roughly twice the traffic of sites like CNN.com. They can’t sustain 40% annual drops in traffic for much longer but they’re probably not falling off the face of the earth anytime soon.
Comparatively, Facebook has almost twice as many monthly unique visitors as MySpace did at it’s peak and the usage statistics, while not 100% reliable, also seem to be much higher. Also, by opening their platform through Open Graph/Facebook Connect, they have made moves to stave off some of the motivating factors that could prompt their primary stakeholders to jump ship. Even if they decline in Q4, as I predict, they should remain the dominant social network for at least a few years, depending on the emergence of a viable competitor (or network of competitors).
That’s my take. Put it in your status update and poke it.
