ellipsis flag icon-blogicon-check icon-comments icon-email icon-error icon-facebook icon-follow-comment icon-googleicon-hamburger icon-imedia-blog icon-imediaicon-instagramicon-left-arrow icon-linked-in icon-linked icon-linkedin icon-multi-page-view icon-person icon-print icon-right-arrow icon-save icon-searchicon-share-arrow icon-single-page-view icon-tag icon-twitter icon-unfollow icon-upload icon-valid icon-video-play icon-views icon-website icon-youtubelogo-imedia-white logo-imedia logo-mediaWhite review-star thumbs_down thumbs_up

5 trends that could take down Facebook

5 trends that could take down Facebook Dave Knox
VIEW SINGLE PAGE

It's hard to argue Facebook's momentum. We are talking about a company that has over 500 million active users, was valued by Goldman Sachs at $50 billion in January 2011 (and $75 billion by secondary markets in March 2011), and is so popular that Hollywood made an Oscar-winning movie about its beginnings. You are also talking about a platform where every month, more than 250 million people engage on external websites, with 80 of comScore's U.S. Top 100 websites having integrated with Facebook.


Given this momentum, it's tough to envision a future where Facebook is not one of the dominant players in the digital landscape. But at the same time, history is littered with the stories of digital goliaths who stumbled from their pedestal (think Netscape, AOL, Myspace, etc.) Could this same fate be in store for Facebook?


Stay connected. For more insights into the latest social media marketing strategies, attend the iMedia Entertainment Summit, June 28. Request your invitation today.

That is the very question I posed to a group of entrepreneurs, digital marketers, and venture capitalists. Could they see a future where Facebook's dominance has been challenged by a new breed of start-ups? And if so, what start-ups today could one day "take down" Facebook?


From those discussions, it appears there isn't a single "Facebook killer" that will sink the social networking giant. Instead, Facebook is faced with the emergence of several themes (and multiple start-ups) that could one day prove a threat to their business.

Here are five emerging themes that Facebook should be afraid of.


Creation of vertical, interest based networks
The very thing that led to Facebook's growth (a standardized and unified experience) could also prove to be a kink in its armor. Gautam Gupta from General Catalyst Partners pointed out to me that "Facebook's market share of time spent on web is driven by the utility it provides to consumers as a social network." This broad social network will continue to have its place, but people are increasingly being drawn to vertical and interest based networks to meet specific needs.


A prime example can be seen in the business world where you have LinkedIn going public with over 100 million members, Quora gaining tremendous traction through its appeal to the start-up ecosystem and ResearchGate connecting 900,000 scientists in more than 192 countries. You could argue that any of these communities could be built on Facebook, but their success proves the appeal of a concentrated, interest based network. The appeal of niche networks extends beyond just business. For instance, GirlsGuideTo bills itself as the "ladies only" guide to 20-something lives on everything within the good, bad, ugly, and taboo.


Notions of trust and privacy
The issues Facebook has faced with privacy have been well documented, ranging from the launch of Beacon to debates around privacy settings on the site. This has continued with their latest product launches, as some have remarked that a major barrier to Facebook Places is the fact it broadcasts to an extended Facebook social network versus the more curated personal networks of a service like Foursquare.
This notion of trust and privacy is going to continue to grow as a theme that consumers are deeply concerned about in the coming years. For instance, Diaspora is a new, open-sourced social network that was created specifically as a response to the privacy "hiccups" of Facebook. Its mission is pretty succinctly stated through Diaspora's tagline of "Share what you want, with whom you want." Path builds upon this by creating what it calls a "personal social network" composed of only your closest friends and family. This "personal social network" is reinforced by limiting a person to only 50 connections on the site. In a more practical application, Ziplist creates a private way for me to easily share my grocery shopping list with other household members. After all, the entire world doesn't need to see when we need to pick up toilet paper.


Discovery of people, places, and information
Some of the most interesting start-ups today focus on helping people with "discovery" of new people, places and information. For instance, Color provides "elastic social networks" based on where you take photos, what's in them and what's around you when you do. StumbleUpon and Tumblr provide a similar sense of discovery on the web. At the core of this discovery ability is the "permission premise" that was called out by Nick Seguin, a partner at Dynamit and Manager of Entrepreneurship at the Kauffman Foundation. As Seguin pointed out to me: "The majority of people utilize the Facebook platform to keep up with acquaintances versus consuming important information. Twitter and Tumblr allow this discovery of information without having to worry about a relationship (or a perceived one.) It's important for individuals to curate the information I consume in those environments. The friend dynamic is great, but also restrictive for Facebook in this regard."


Joe Medved from Softbank points to mobile as another particular area of "discovery" that could prove a hurdle for Facebook. According to Joe, "Social networking services focused on discovering others, where you can build a somewhat virtual persona, or better yet an embellished version of your real persona, have potential. Ninety percent of social networking users in Japan don't use their real name, which is why there are 3 social networks, 4 if you count Twitter, with around 20 million users, as opposed to one dominant player like Facebook. The vast majority of social networking activity in Japan is on mobile phones. As smartphone penetration goes more mainstream in the US, mobile centric social networking services leveraging smartphone capabilities have the potential to take share from Facebook."


Need to motivate human contact
With the rise of digital over the past decade, the definition of "friends" has certainly changed. While Facebook was started with the intent of being only focused on real relationships, the site has evolved to the point where your social network is much broader. At the same time, you could argue it is really not enough to have an online only relationship or even one that is primarily digital (i.e., the folks from high school you haven't seen in over a decade but are "friends" on Facebook.) This has left the door open for companies who motivate in person interaction. One such company that capitalizes on this inherent Facebook weakness is Meetup, whose mission is to "to revitalize local community and help people around the world self-organize." It is a mission that is definitely working, with over 250,000 monthly Meetups in over 46,000 cities worldwide.


While Meetup was one of the first to recognize that digital could actually be an enabler of human contact, many more have followed suit. For instance, Skillshare allows you to "learn anything from anyone" by connecting with folks in your community who have a skill to share. GrubWithUs tackles the problem of meeting new people in the years after college by "building friendships over food." Wednesdays takes a similar approach of meeting over food, but is instead focused on coordinating lunches within an organization. All of these companies are capitalizing on the basic need for human interaction, but using digital in new and unique ways to do so.


Consolidation, curation, and control of entertainment
On the backs of social gaming companies like Zygna, Playdom, and Playfish, Facebook has emerged as a major player in the world of gaming, helping invent a new category along the way. But outside of "social games," Facebook has been slow to capitalize on entertainment as an overall vertical. This was one major reason that Myspace briefly attempted to rebrand as a "social entertainment" site focused on sharing and finding music, television, games, and movies. And in a more successful example, this is why services like Pandora, YouTube, and Hulu have been able to flourish in their respective spaces.


Given the size of the entertainment vertical and its importance to consumers, it is somewhat surprising that Facebook is still largely ignoring the space. This opens the door for additional companies to move into the consolidation, curation, and control of entertainment. For instance, Rovio was able to create its Angry Birds franchise without overreliance on the social graph of Facebook, instead focusing on iOS and Android. This move towards mobile also opens up new opportunities to monetize entertainment leveraging platforms like TapMe. Outside of gaming, you have other start-ups combining elements of social networking with entertainment. As an example, Spotify has 10 million subscribers -- one million of which are paying subscribers -- in Europe that have created 200 million playlists. Spotify specifically calls out "social music" as a feature that makes it easy to share everything you listen to on Spotify with your friends including tracks and playlist.


Conclusion: Facebook is the suburbs
There is no question Facebook will continue to dominate the digital landscape in the coming years. But there is a very real chance that alternatives will emerge reflecting the evolving needs of our population. As Phin Barnes from First Round Capital stated when I asked his opinion: "One argument is that Facebook is the suburbs and we need to see networks that more closely resemble the diversity of dense urban living and the trust/community of small rural towns." In this regard, Facebook's biggest threat might just be the needs and wants of the same constantly evolving community that built it in the first place.


Dave Knox is chief marketing officer at RockFish Interactive.

On Twitter? Follow iMedia Connection at @iMediaTweet.


Dave Knox is CMO for Rockfish, one of the fastest growing digital agencies in the country. Prior to his role at Rockfish, Knox was a seven-year veteran of Procter & Gamble, where he was instrumental in the digital turnaround that led to P&G...

View full biography

Comments

to leave comments.

Commenter: Peter Anthony Gales

2011, May 26

Great article. I have this lurking fear that Facebook will become the dreaded Big Brother that will oversee and pervade everything, usurping opportunity from everyone else.

I used to look at Google in this regard, but after reading the Master Switch by Tim Wu I realize how fragile Google's dominance really is.

I still don't see an imminent fall to FB anytime soon, because FB seems to have succeeded at becoming the context for everything else. It's not that people are leaving FB for these other more personalized/homey/friendly sites but rather they are joining theses sites while still remaining on FB. FB's social proof is just too overwhelming to be overcome by anything out there. People want to be where everyone else is.

In that sense FB as the suburbs doesn't work as a suitable analogy for me because one has to go to the suburbs whereas FB is more like the context for everything else. FB has become or is becoming like the fabled "ether (aether)" that provided the medium of space; and allows context and traction for everything else to occur or even exist. That's scary.

There's still a chance that "not being on FB" will become a form of exclusive snob appeal that will cut Big Brother down to size.

Commenter: Lloyd Silverman

2011, May 24

facebook continues 2 evolve, continues to modulate audience behavior through scientifically designed
platforms that nourish our personalized interests...
facebook is around for a while....

l.a.s.
ceo
www.comunic8.com
www.facebook.com/comunic8

Commenter: David Fardon

2011, May 24

Great piece. I think we all need to believe that there's going to be something other than Facebook, right? That doesn't mean Facebook isn't the 800-pound gorilla it clearly is, but a one-size-fits-all monopoly of the online social scene just isn't right.
Is there space for a bunch of vertical, interest based social networks to run alongside Facebook? Of course there is. Are they going to bring Facebook down? Of course they aren't.
The social network zeitgeist is all about specialisation right now. Excuse the plug but we just completed a travel-based social network project called StaysatFriends (http://staysatfriends.com) that allows you to use your network's properties when they aren't there - and I know of at least two other projects on exactly the same lines that are nearing completion, plus a bunch of others that are in the same ballpark.
Remember, although Facebook may have 500 million users, that means that there are still more than 6 billion people who aren't on Facebook. Plenty of room for the little guys yet!