Proof offered of Facebook's decline in the UK
Rumours of Facebook's decline in the UK have spread in recent weeks, now Neil Charles, head of econometrics at Brilliant Media offers proof that the social networking giant is losing rather than gaining users.
Last week, I took issue on my own blog, Wallpapering Fog, with a report that said Facebook traffic could be declining in mature markets. My argument wasn’t really with the idea that Facebook had peaked – it might have peaked and it might not – the issue was that we had no idea where the data came from and so had no way to critique the report.
Google is fast becoming the go-to source for web data and at least we know roughly what we’re getting. Yes, they often index the numbers and yes in some cases they deliberately make it difficult to analyse (for example if you want to find out whether paid search cannibalises natural. Don’t get me started…) but Google do release large amounts of data and we do know roughly what it’s based on.
So what has Google Trends got to say on the Facebook issue? Google themselves are getting very excited about the ability of search volumes to predict statistics such as flu incidence. It’s not too much of a stretch to say that the level of searches for Facebook could be a reasonable indicator as to whether the site is growing or not.
Here are Google Searches for Facebook in the UK.
Having followed a classic bass-curve growth pattern since 2006, they’ve certainly stabilised and arguably turned over and started to decline in 2011.
And the US.
Certainly slowing and arguably flat since the end of last year.
A criticism I aimed at the Inside Facebook report was that the growth of Facebook access through smartphone apps could cause a measured traffic decline and that’s certainly true of this data too. It would still be a concern for Facebook’s business model though as it’s much harder to deliver ads on the smaller screen of a smartphone. You need that valuable screen real-estate to deliver the app.
Lining up a few North American and European markets and also throwing Japan into the mix, let’s see what we’ve got.
You might want a new window for this chart. I’ve taken Google Trends data (relative scaling,) set the week of 12-Jun-11 equal to 1 and averaged the data up to monthly
From the top of the chart downwards, that same stagnation and arguable 2011 decline repeats across the UK, US, Australia, Canada, France, Spain and Italy. Only the final two – Japan and Germany are still showing significant growth and both of those have slowed.
It’s easier to see if we look at year on year growth. (I love Tableau – it makes stuff like this so easy.)
OK, so Facebook’s amazing growth has pretty much stopped in Europe and the US. In France it’s now declining at 10% year on year.
This is no real surprise. You can’t keep growing at an exponential rate; you’ll eventually run out of new customers. Huge Facebook valuations that assme the growth spurt will continue though, look a bit of a worry. Again, any type of Facebook floatation right now, looks to me like the founders are thinking of cashing out.
The real issue for Facebook long term – and what in my opinion is going to be its undoing sooner or later – is that it has very little reason for users to stay, beyond the fact that it knows their network and makes social connections easy. It offers photo storage, but there are better places for that. It offers video, but there are better places for that too. Social gaming? The list goes on. Facebook has nothing to offer that you can’t get better elsewhere, except that it makes sharing easy.
If I could share photos and a news-feed with my friends, through Gmail, Diaspora or a solution I don’t even know about yet, and crucially, do it better and without giving the content to Facebook, then I could migrate to that platform pretty well instantly. The crash could happen incredibly fast.
Facebook arrived in four years. My prediction is that it could become a ‘remember when…?’ within the same time period.
I know, I know. And Decca rejected The Beatles. I’m on record about Facebook from some time ago though and there’s no going back now.
Back to Google Trends one last time. No prizes for guessing what the blue line is as you’ve seen it before – it’s US searches for Facebook.
You’d probably guess that the red one is Myspace. And you’d be right.
Just saying Facebook’s the next Myspace is an easy, throw-away dismissal of that ridiculous $50bn Goldman Sachs valuation of Zuckerberg’s baby, but look again at the Myspace curve. It flattened before Facebook generated any serious traffic. Myspace hit a glass ceiling, stabilised and became vulnerable to the upstart Facebook, which nobody would really hear about for at least another 18 months.
Now look back at those Facebook growth curves. I’d argue that Facebook may just have become vulnerable for the first time in its short existence. Want to bet against there being a start-up, or a twinkle in the eye of somebody at Google Labs, which is still 2-3 years away from the mainstream? After all, in 2007, you’d probably never heard of Google Android.
Facebook might develop its own replacement, but it’s a big company now and big companies tend to be slow. I’d be willing to bet there’s not one developer at Facebook, charged with building something that doesn’t use or extend the current Facebook platform. On the web, that’s how you die and going on the history of Myspace, it takes a couple of years from noticing your growth slowing down, to finding out that you’ve left it far too late to do anything about it.
This blog post was kindly reposted from the website of Brilliant Media.