What We’ve Learned From The Success & Failure of Facebook
At only 15 years since its early creation, Facebook now has over 2.4 billion monthly active users worldwide and almost 40 000 employees, which increases by 31% each year (Zephoria). Founders and technicians would have dreamed of their product or service being taken up at the same astonishing rate that Facebook has, especially considering its humble foundation in 19-year-old Mark Zuckerberg’s college room at Harvard University. Fast forward to this year, Zuckerberg was named the eighth-richest person in the world with a net worth of US$62.3 billion, according to Forbes. Despite its seemingly unstoppable success, it turns out that even Facebook is not immune to eventual downturn. Recent statistics have found that for the first time in history, Facebook usage is in decline.
The Rollercoaster of the Product Cycle
Did we ever think we would see the day when Facebook would become redundant? Well, if we consider the inevitable product cycle, this would seem to be fate. All new products and services that hit the market will come and go as new innovations to take their place. Emerging technology continually adapts to meet the changing needs of its users and the changing world around us. Considering this, whilst it may seem that Facebook has run out of luck with the Cambridge Analytica scandal and its subsequent decline, the platform has still proven to be an enormous success. Let’s unpack this a little further by looking at how Facebook became such a global hit.
Crossing The Chasm
Most marketers are familiar with the product cycle and the stages of adoption. If you’re in the emerging tech space, first you will sell to a few die-hard tech-lovers. Then you will see sales reach a wider group who can see the potential in your product so are willing to cope with a few early glitches. These groups are the enthusiasts and the visionaries. Crossing the mystical chasm is the clincher where many fail. This next group is more pragmatic and doesn’t want to be wasting time with anything that doesn’t serve a valuable purpose. For this group to adopt a product, it needs to be fully-fledged in the market. This then leads to the latter two groups taking an interest in the product once they see evidence of its worth and are convinced by those around them to opt-in or risk falling behind. At this stage, the early adopters and much of the mainstream market have moved onto more innovative product offerings, which is where the decline in usage is seen.
Facebook - The Chasm Master
This may be hard to believe, but Facebook hasn’t always been the only social networking site. Remember MySpace? Well, Zuckerberg was the first to cross the chasm, which saw Facebook grow exponentially and leave its competitors in the dust. So what made Facebook so popular? Here are some of the strategies the company used that any business can adopt:
Numerous entrepreneurs can have the same idea, but it’s all about execution:
Zuckerberg was accused of stealing the idea for Facebook from some of his college friends, but he was the one who made it happen. Get the idea off paper and into something tangible.
Keep user experience in mind, especially with a new product or service:
The first version of Facebook was extremely basic compared to the current model. It served its purpose as a networking site effectively in initial stages, providing a foundation to be built upon later down the track.
Learn from the mistakes of others:
Zuckerberg made sure that Facebook didn’t grow quicker than the technology could support. Unlike competitor platform, Friendster, which ended up being unusable because the number of users made it so slow. Zuckerberg started Facebook at Harvard and then slowly released it to surrounding universities to prevent overload.
Know your audience:
According to his peers, Zuckerberg was no ‘programming prodigy’ (Business Insider). He was actually a psychology major at Harvard, which gave him the knowledge to build a social networking site that could be so addictive. The instant gratification of likes and comments are undeniably effective for drawing people to the platform. Zuckerberg knew what the people wanted and how to deliver.
Data for actionable insights:
Gaining data and feedback on a product allows for improvements to be made, which in turn attracts more users. The data provided by billions of Facebook users became a lucrative commodity. However, this also became its downfall.
The Data Love-Hate Relationship
Having access to the data of billions of people around the world turned out to be the reason that Facebook was so successful, but it was also the reason for its recent decline. Facebook has an almost god-like surveillance capability in seeing who we are friends with, which events we go to, what we like, what we share, and where we visit. This data is ever so powerful in the way that it can provide actionable insights for product improvement, marketing strategies, and eliminating competition. Many believe that Facebook’s purchase of Whatsapp in 2014 was to eliminate a rival (Sydney Morning Herald). Zuckerberg would have been able to see that the app was gaining traction through the immense global data he had access to. So if this is the love side of the data relationship, let’s have a look at the other side that has seen Facebook’s demise.
Many have hailed data as the new oil (The Economist). However, both resources have the potential to cause undesirable consequences in the wrong hands. The Facebook-Cambridge Analytica scandal last year demonstrated the power of data and the desire for large companies to obtain it. Facebook made it possible for the data of millions of people to be mined and exploited. This is arguably the most significant factor that has led to Facebook’s demise, as people have now lost trust in the platform. The scandal prompted a heightened awareness among internet users of the value personal data holds. It came as an eye-opener for many of us to know how our data is really being used.
Whilst privacy concerns over personal data have undoubtedly had a weighting on Facebook’s recent decline, it’s not the only reason. Anecdotal evidence for people turning away include:
Lack of authentication and the resulting fake news epidemic has led to decreased trust in the newsfeed.
The overload of information available through Facebook has many people turning away due to feeling overwhelmed and unable to focus.
When the platform gained mass adoption people began to seek out new experiences, such as Snapchat, which is a platform their grandma might not be on.
Looking at this from the product cycle perspective, it becomes clear that Facebook is hitting the conservatives and laggard groups on the downward slope. First, it was an exciting but small invention for college students, then more people wanted to join the social network, then everyone had a profile, and now your grandma is liking your pictures. Those college students who were there when Facebook was created might still have an account, but you can bet they’ve moved onto bigger and better things. That’s the way innovation works. Whilst Facebook crossed the chasm with outstanding success and was able to grow exponentially as the company made improvements along the way, its failure to protect the personal data of users became the Achilles heel. Data became too much of a lucrative commodity. Failing to adapt by not providing adequate online security showed that even Facebook cannot withstand the eventuality of the product cycle. Other companies who have watched on have learned the value of protecting user data, and so the cycle goes on. We continue to learn, innovate, grow, and adapt to the changing world around us.
Let us come on board as a collaborative partner to help you navigate through the product life cycle. Whether you want to grow, scale, or get out of the product decline slump like Facebook, Forestlyn provides marketing strategies and guidance to set your business on the path to market success. To find out more about how we can help, book a free consultation with us here.
Let us help you navigate through the product life cycle, whether you need help growing, scaling, or to get out of the product decline slump like Facebook, we help with marketing strategies and guidance that will get you back on the growth path again. Book a consultation with us here.
Written By Sophie Stockman
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