Facebook in decline? It’s a matter of trust

June 22, 2011

The trouble with urban myths is they have a habit of gaining credibility if enough people retweet them. No, not the one about Jemima Khan and Jeremy Clarkson. This one is practically cosmic in its significance. Facebook, they say, is perched on the edge of vertiginous decline and will never make the 1 billion users its avid investors are banking on for an IPO.

The rumour appears to have begun with a plausible article, whose headline says nearly everything you need to know: ‘Facebook sees big traffic drops in US and Canada as it nears 700 million users worldwide’. I don’t want to become entwined in a discussion which has all the nit-picking allure of a symposium on the Arian heresy conducted by the early Roman Catholic church. So I won’t. The gist is that Facebook’s tsunami-like growth in developing countries conceals an actual audience decline of 6 million people in the USA during the month of May.

So far as the statistics are concerned, they seem to have been robustly rebutted by Henry Blodgett over at Business Insider. His distilled point is that the so-called decline ignores mobile use, which in fact increases steeply as high school kids and students pack up for the long vacation. So investors and advertisers can relax. There’s no decline at all, just a bit of a hiccup.

Whatever, it’s started people thinking – and many of these people seem to be older-profile Facebook users. A poll conducted by OnePoll among 1300 UK users for Marketing magazine reveals that a majority of over-45 year olds are considering exiting from Facebook. Youngers ones aren’t that chuffed either – more than a third said they had thought of quitting recently.

This may indeed illustrate Facebook fatigue, but more likely reflects growing alarm about Facebook’s perceived abuse of privacy (58% said they were unhappy about Facebook’s use of personal information).

Either way, Facebook should be concerned (although it says it is not). Forget the statistics. What matters here is engagement. As growth inevitably slows in the more advanced economies such as the USA and Britain, so Facebook will have to expend more effort on creating greater dwell time, by launching new and more useful tools. Alas, these tools come at a certain cost, if they are to be of use to advertisers – they involve ever-more sophisticated manipulation of personal information.

i circulation soars – but what happens when they pull the plug on Jemima?

February 11, 2011

Sales of “Britain’s concise quality newspaper” – otherwise known as the 20p i – are doing far better than expected.

After a bumpy start to its career, the pocket-size Independent has received a confidence-boosting fillip to its circulation, thanks in part to a TV advertising campaign starring – among others – Jemima Khan.

Confidence enough, at least, for the management team to disclose its first Audit Bureau of Circulations figures a month before the competition had anticipated.

The headline figure for January (that means the total including bulk and freebie copies) was 133, 472, of which a healthy 125,702 copies were actually paid for.

These figures are interesting for at least two reasons. First, as my colleague at Marketing Week, Lara O’Reilly, has pointed out, if you add the gross Lite figures and the gross Standard Issue figures together, you get 318,507 – which puts the Independent comfortably ahead of our only other liberal newspaper, The Guardian.

Second, and more commercially important, the first ABC figures mark a watershed in the Independent’s relationship with the media buying fraternity. According to sources close to the competition, the Independent sales team has a deal going with the agencies that once the combined “offer” reaches paid-for sales of 340,000 a day, the ads thus far appearing in i will actually have to be paid for, and that the ratecard will approximately double.

Whatever the fine-print truth, it’s a commercial turning-point that is now hoving into view. The eagle-eyed among you will have noted that the present combined figure is still a good way short of that 340,000 goal. It’s even lower when considering the paid-for figures. The Independent itself is heavily bulked, and the combined paid-for figure would be a mere 214,126. But the ABC figures represent an average, an average that disguises the momentum of i sales. By the beginning of this month, with the TV campaign still running, i’s daily circulation had soared to 160,000 – according to the publisher. This week, distribution of i will extend to the further reaches of the British Isles. The Independent’s management must be hoping that growth will be given an extra spurt, bringing the combined paid-for figures close to that moment of commercial truth.

Ah, but that’s February’s figures. What about March’s, when the TV campaign life-support system will have been switched off? A good question, and one that Andy Mullins, managing director of the Independent and i, will no doubt be pondering. One further thing, though: these January figures do demonstrate a milestone has been passed. Many of us outside Lebedev Towers predicted i would merely cannibalise sales of the Independent. That prediction has not come to pass. Sales of the Independent, although chronically low, have not been significantly eroded.

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