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At 10, Facebook strives to not be your granny's social network

Sharon Gaudin | Feb. 5, 2014
Facebook defines social networking but must fend off the next big thing, teen boredom

When the company was preparing to launch its initial public offering in 2012, executives listed mobile as one of its biggest risks. The company had not figured out how to generate revenue from the burgeoning number of users who were accessing the site via their mobile phones.

Eight months after its IPO, Zuckerberg began referring to Facebook as a "mobile company." By that time, more users were accessing the site from mobile devices than from the Web, and more importantly, mobile accounted for 23% of Facebook's ad revenue, up from 14% the previous quarter before and zero from a year earlier.

However, while Facebook mades gains in mobile, it struggled much more with its highly anticipated IPO.

There was great anticipation about Facebook's IPO, but the company stumbled repeatedly in the months leading up to the launch. Zuckerberg met with potential investors in jeans and a hoodie, raising questions about his maturity. The company raised its opening price at the last minute and suffered a blow when General Motors, one of the country's largest advertisers, pulled a $10 million ad campaign days before its IPO.

With those troubles ahead of it, the company's IPO, despite the media frenzy, stumbled out of the gate. Its stock slid for months, hitting a low of $17.55 per share before rebounding to its opening price of $38 slightly more than a year after going public.

With Facebook on track with mobile, the company's shares have soared, closing Monday at $61.89 a share, Facebook is looking to its future.

As the company moves ahead, it faces new challenges, including boredom among its younger users and irrelevance.

The online market is a fickle one. Just ask MySpace.

Facebook has said that it's seen a decline in teenage users. During a quarterly earnings call this past November, David Ebersman, Facebook's chief financial officer, reported that the social network is struggling to keep teenagers' attention, though he also called the teen user base "stable."

It's not a new problem. As far back as 2009, a study released by iStrategyLabs showed that Facebook's U.S. high school and college-age users were on the decline even as its popularity among the 55-and-older crowd was booming.

The social networking site that cut its teeth on college-age users is now trying to figure out how to keep the attention of that same age range. Suddenly Zuckerberg, who became the world's youngest billionaire, is shepherding a company that may no longer be seen as the fresh, cool site.

Is 10 the new 50?
Can a site remain the top social network in the world if young users think of it as the site that their parents and grandparents use?

 

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