Investors who have held Facebook (FB) shares for years are probably well-accustomed to concerns that the social network is falling out of favor among teens, which date back years, but these concerns have resurfaced this week. One firm predicts that for the second year in a row, this key demographic of Facebook users may actually cut back their usage of the social network in favor of the photo-centric platforms Instagram and Snapchat.
Meanwhile, the lead underwriter for Snap’s IPO (SNAP) has again slashed its price target, and another firm has initiated coverage of Facebook, Snap and Twitter, declaring one network “king of the social web.” Engagement seems to be falling by the wayside in favor of revenue growth.
TeroVesalainen / Pixabay
Will Snap finally have its day?
eMarketer is predicting that Facebook users in the U.S. who are aged between 12 and 24 might cut back the amount of time they spend on the social network or even abandon it altogether. The firm is calling for a 3.4% year-over-year decline in Facebook users aged 12 to 17. In 2016, the monthly user base in this age group declined 1.2% year over year.
Analysts at eMarketer said they’ve observed teens and tweens migrating from Facebook to Snapchat and Instagram because they are more visually focused. And the current Facebook users in these age groups are engaging with the social network less and less, they add. Additionally, they’re starting to see young people they call “Facebook-nevers,” which are children entering the tween years who are simply skipping over Facebook but using Instagram.
The firm has increased its estimates for Snapchat’s user growth to be in line with the data reported by the company. eMarketer now looks for Snapchat’s U.S. user base to grow by 25.8% to 79.2 million monthly users. The firm sees Facebook as being “fortunate that it owns Instagram” because the photo-sharing platform is popular among teens. eMarketer predicts that Instagram’s U.S. user base will increase 23.8% to 85.5 million.
Leave A Comment