Software // Social
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2/7/2014
11:47 AM
Kristin Burnham
Kristin Burnham
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Facebook's Next Decade: 3 Key Challenges

Facebook redefined privacy and sharing, but the next 10 years will force the social network to find new ways to connect with a changed culture.

10 Famous Facebook Flops
10 Famous Facebook Flops
(Click image for larger view and slideshow.)

In Facebook's first 10 years, we stepped outside our comfort zone. It was the first time many of us paired our online identities with our real names. We -- perhaps without even realizing it -- became more comfortable sharing more: our photos, our thoughts, our locations. That's exactly what Mark Zuckerberg wanted.

But as Facebook flourished, privacy grew complicated. The social network added settings. It removed settings. It launched features that collected user data. While Facebook set out to blaze a trail of openness, it left users pining for more privacy.

Finally, after 10 years of surrendering to Facebook privacy change after privacy change, the inevitable happened: We became less open, less social.

According to a survey by the Pew Research Center, only 10% of users update Facebook status on a daily basis. One quarter report they never do. Sharing and openness have been the lifeblood of Facebook, but that's changed. During the next 10 years, Facebook faces three big challenges -- but can address them.

[Facebook has suffered some strikeouts during its 10 years. Read 10 Famous Facebook Flops.]

Reclaim the teen demographic
Young users have been Facebook's bread and butter. The social network was built for them, by them. But Facebook's growth spurt came at a cost: Adults, teens say, have made the social network uncool, and teens are leaving for competitors.

According to a report by Piper Jaffray, just 23% of teens cite Facebook as the most important social network, down from 33% six months ago and 42% a year before. In January's quarterly call, Facebook acknowledged the trend: "We did see a decrease in [teenage] daily users, especially younger teens," Facebook chief financial officer David Ebersman said.

While Facebook's legacy users tend to prefer one social network over others, the same isn't true for teens. They use a variety of apps -- Instagram, Snapchat, WhatsApp, AskFm, and Twitter are among the most popular. These apps share similar characteristics: They're mobile, they're messaging platforms, they're quick, and they're easy.

To regain this vital demographic, Facebook needs to tap into teens' habits with standalone apps of its own. These apps need to hinge on communicating, community, and sharing. Integrate them with Facebook, but don't make it obvious. (Facebook is for old folk, after all.)

Out-innovate the competition
Facebook learned a valuable lesson in letting its teen population slip away: Underestimate the competition, and key users will disappear.

Facebook has been complacent thus far in its strategy to keep competitors at bay. To challenge Instagram, Facebook launched an identical app of its own called Camera. But when Facebook's replica wasn't enough to lure users, it resorted to Plan B -- acquire Instagram -- which it did to the tune of $1 billion. Smart acquisitions are important, but they're not always practical.

Snapchat's story was similar: Facebook launched rebuttal app Poke, which also flopped. Plan B -- likely to Facebook's surprise -- failed too, ending with two rejected purchase offers: $1 billion and upwards of $3 billion cash, according to reports.

As Facebook learned, it can't assume a replica app stamped with its name will be enough to succeed. Nor is it smart to assume that money can exterminate the competition. Instead, Facebook needs to ditch the pirate-or-purchase attitude and out-innovate them.

What can Facebook's mountains of data and algorithms bring to a trend captivating users? How can Facebook use its strengths to make it better? That's the cornerstone of Facebook's success, and that's what will propel it into the future. Status quo will no longer cut it.

Address older users' privacy concerns
Users who grew up with Facebook have vastly different opinions of privacy than those who logged on as adults, and the rift is apparent. "Teens are increasingly sharing personal information on social media sites, a trend that is likely driven by the evolution of the platforms teens use as well as changing norms around sharing," Pew said in a recent report.

Ninety-one percent of teens post photos of themselves, compared to 41% of adults. Eighty-two percent of teens share their birthday; 71% share their hometown; and 53% share their email address. Teen users don't think twice about revealing personal information, while the topic gives many adults heartburn.

Needling users to share more, as Facebook has done throughout its history, isn't working now -- and won't work in the future. As much as Facebook needs to reclaim its teen users, it needs to retain its adults. Gift the social network with intuitive controls and more of them; leave the openness, the sharing, and the data collection to its new breed of apps for teens.

Facebook's first 10 years were wildly successful, surpassing anyone's expectations. It amassed more than 1 billion users and continually reports record sales. The next 10 years will be more difficult: Its user base is fluid and its competitors are many. Facebook needs to pause, listen, and innovate. You're big, Facebook, but you're not immortal.

What advice about the next decade would you give Facebook?

Too many companies treat digital and mobile strategies as pet projects. Here are four ideas to shake up your company. Also in the Digital Disruption issue of InformationWeek: Six enduring truths about selecting enterprise software. (Free registration required.)

Kristin Burnham currently serves as InformationWeek.com's Senior Editor, covering social media, social business, IT leadership and IT careers. Prior to joining InformationWeek in July 2013, she served in a number of roles at CIO magazine and CIO.com, most recently as senior ... View Full Bio

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Kristin Burnham
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Kristin Burnham,
User Rank: Author
2/10/2014 | 3:21:31 PM
Re: Facebook's three big challenges
Google+ is not popular in my circle of friends. In fact, I don't know one person who uses it by choice (some use it for work purposes). I do get notifications every day saying more people have added me to their Circles, though they appear to be spam accounts.

On a related note, I always hear that those on Google+ tend to engage in more debates and conversations. Why it moved to a very Pinterest-esqe design confuses me; it doesn't highlight conversation very well at all.

 
Laurianne
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Laurianne,
User Rank: Author
2/10/2014 | 2:42:58 PM
Re: Facebook's three big challenges
10 social profiles? No one has time for that. 4 is a lot to manage right now. Still, Facebook, LinkedIn and Twitter have carved out their niches. Google+ is the wild card. Are you running across more people you know using Google+?
Somedude8
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Somedude8,
User Rank: Ninja
2/10/2014 | 12:55:58 PM
Facebook in 10 years? Who?
I doubt that Facebook will be doing all the much 10 years from now. They will exist, probably much like MySpace technically exists now, but maybe with a few more users than that.
Shane M. O'Neill
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Shane M. O'Neill,
User Rank: Author
2/10/2014 | 11:42:35 AM
FB will have to change
Facebook has found itself with two audiences (older vs. gen y/millennials) who have conflicting desires and demands. If you're young and suddenly grandma and Uncle Phil are using the same social platform as you, you gotta get out, or at least post less and fill in the gaps with snapchat, instagram etc. Facebook will always keep it's core business (social networking) but will have to expand into new products to survive just as Microsoft, Amazon, Google and Apple have done. The road will get harder for FB in the next 10 years but it has the smarts to adapt and thrive.
Ariella
IW Pick
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Ariella,
User Rank: Ninja
2/10/2014 | 10:24:51 AM
Re: Facebook future
@petey I don't think a company has to actually make something to be successful. They can provide a service, and FB does that in terms of providing a platform for interaction that yields quite a lot of data for marketers.
Drew Conry-Murray
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Drew Conry-Murray,
User Rank: Ninja
2/10/2014 | 10:24:15 AM
Re: Your thoughts?
I think Facebook should go private. The company could have a nice, modestly profitable run for a long time with only a modest amount of selling out its users. But as long as it stays public, Wall Street is going to demand growth that isn't going to happen, which is going to generate lots of bad feelings from investors. In turn, Facebook will come up with more and more invasive and creepys ways of selling out users as it tries to appease the Street, which in turn will drive more users away.
petey
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petey,
User Rank: Strategist
2/9/2014 | 5:50:47 PM
Facebook future
The issue with Facebook is that they do not make anything. In essence they are a marketing company which has had mixed results. Marketing companies have a short shelf life. The closest thing I can think of is nike but they actually make something. Can anyone tell me what will happen to Facebook marketing future when Microsoft and Apple begin to embed advertising into their operating systems?
Kristin Burnham
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Kristin Burnham,
User Rank: Author
2/7/2014 | 4:49:07 PM
Re: Facebook's three big challenges
I can't even imagine curating 10+ social networking profiles... Then again, teens will likely be ten times better at multitasking after growing up with this technology. :)
danielcawrey
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danielcawrey,
User Rank: Ninja
2/7/2014 | 4:42:42 PM
Re: Your thoughts?
I am not comfortable sharing things everyday on Facebook. I do from time to time because I need to. 

I like Twitter better for sharing the things that are going I am interested in. 

Twitter is a different dynamic than Facebook. I don't use Twitter as much as a communications tool, just as a way to broadcast content. I think that Twitter in the long run have more potential than Facebook. 
IMjustinkern
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IMjustinkern,
User Rank: Strategist
2/7/2014 | 3:45:58 PM
Facebook's three big challenges
Good piece ... I think the Graph search function has a lot of potential, especially going forward with more and more data. But I have a hard time seeing a future for any social network once the cool factor has worn off (outside of LinkedIn, which was never cool, and isn't really supposed to be). Google+ has some potential in the way it segments audiences in this way, but I'm inclined to think for the near future, that the younger/hip crowd will opt for other avenues to share with peers outside of Facebook, where they're "friends" with their mothers. And after a while, there will either be cannibalization of Facebook's own audience, or everyone will just have 10 social profiles.
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