With regards to the loss of teen subscribers, I modified the below from an article linked to by someones post on the FB page, but I can’t remember where. I thought it was very useful.
Teens could be done with Facebook for good, according to a Piper Jaffray survey that reveals that only 45% of teenagers still used the site, down from 72% a year earlier.
A large decline in teen interest is worrisome, especially after those teens become young adults. So let’s look at where teens are going instead, and how much of this exodus actually matters to Facebook. Well, the “new” Facebook for teens is owned by Facebook.? Piper Jaffray’s survey found that most teens flocked to photo- and video-sharing site Instagram, which is owned by Facebook. Teen usage of Instagram rose from 69% last year to 76% this year.
A popular theory regarding the decline of Facebook is that parents have joined the network to keep tabs on their kids. According to a study, 43% of parents check their kids’ FB profiles daily. The study also revealed that between 2010 and 2012, the number of moms using FB surged from 50% to 72%. That trend likely pushed kids to flee Facebook and share their photos on Instagram instead. As a result, CEO Mark Zuckerberg’s $1 billion acquisition of Instagram in 2012, which many ridiculed at the time, turned out to be a pretty smart move. Between 2013 and 2014 Instagram’s active users doubled from 100 million to 200 million. By comparison, Facebook’s user base only edged up from 1.16 billion to 1.32 billion.
This “illusion of choice” that Facebook gives its users is exactly why it acquired WhatsApp for $19 billion, yet kept its 600 million active users separate from the Messenger app. That way, those who don’t like using Facebook Messenger for all their messaging purposes (for example, teens avoiding parents) could access an alternative platform.
Would a teen exodus hurt Facebook’s long-term plans?? Teens leaving Facebook hasn’t affected the social network’s year-over-year growth for a simple reason – it’s being taken over by older users. A January 2014 study by iStrategyLabs revealed how striking this trend was.
While that drop-off in younger users is disappointing, FB investors should remember that ads generated 92% of the company’s revenue last quarter. Even as younger users stopped using Facebook, its advertising revenue rose a whopping 67% year over year to $2.68 billion last quarter.
The reason is simple: younger users, for all their hipness, don’t have as much spending power as older users. Baby boomers are expected to control 70% of all disposable income and purchase 49% of all consumer goods between 2012 and 2017. This means FB’s steep growth among older users actually makes it a more lucrative platform for advertisers.
What happens when young non-Facebook users grow up?? While some pessimists believe the teens who have abandoned Facebook will never return, I believe that the opposite is true. After teens grow up and get jobs as young adults, their relationships with their parents and relatives will change. The same teens who were embarrassed to share their photos and daily musings will more likely come back to FB to keep in touch with their parents. When those young adults get married and have kids of their own, that cycle will reboot as they start showing pictures of their own kids to the grandparents, and later, checking up on their own kids.
FB has only been around for a decade. A generation lasts 25 years, so we haven’t even seen half of a full growth cycle for the social network yet. Teen user-ship numbers will inevitably fluctuate over the years, but older users will keep offsetting those losses. Moreover, more older users will generally attract more ad revenue, which should help the company’s top line continue growing into the foreseeable future.