October 3, 2023

Who Trusts Facebook?

Who Trusts Facebook?

Facebook seems to be facing a long overdue existential crisis in the aftermath of the Cambridge Analytica data leak. It is not the first time that the social media giant has had to confront the dilemma of losing trust and even users. In fact it is only the latest in a long saga of controversies for CEO Mark Zuckerberg.

Of course, it is possible to argue that the company’s data mining had little impact on the 2016 US general election, or that it was being like any other commercial marketers. But this time, a threshold has been crossed and users feel that they are giving up too much information about themselves, and for too little in exchange, and users find themselves wondering if the time has indeed come to #DeleteFacebook.

Regaining this lost momentum doesn’t seem like it would be an easy task especially with emerging audiences in newer geographies and age groups. There have been so many recent reports that Facebook is steadily losing its millennial audience base. According to the digital measurement firm eMarketer, Facebook lost around 2.8 million users under 25 in 2017. The research firm expects that Facebook will lose about 2.1 million users in the U.S. under the age of 25 this year. While retaining millennials is proving to be a steady challenge, it isn’t any different among the older audiences, with this latest breach of data security only creating fear and mistrust.

In emerging mobile data growth regions, Facebook cannot take its place for granted either. Already the next big internet user group from India and China is starting on social media with WhatsApp and Wechat, and not Facebook. Further, in some African countries where Facebook has implemented the Free Basics initiative, signing up almost half of the countries and a combined population of 635 million as reported in 2016, many have been seeing it as a cynical marketing ploy with a heavy hidden cost.

As things stand, there are clearly a number of people who are wondering why they are on the platform in the first place, and how Facebook manages this crisis of handling people’s private information will decide its future. The company does have a responsibility around user data, and a business imperative. Lose users’ data, and losing their trust follows, setting off a downward spiral that could threaten Facebook’s money-making engine.

One of the ways in which this could happen is if there is sufficient reputation damage and advertisers leave en masse. But it doesn’t seem like a likely outcome as they don’t have more competitive Digital options. WhatsApp does not lend itself to ads as easily and neither does Instagram, not yet anyway, and moreover, both companies are also owned by Facebook. Snap hasn’t emerged as a strong enough ad competitor either, again thanks to Facebook’s aggressive manoeuvring.

But quitting Facebook altogether, whether it is users or advertisers, won’t necessarily solve the problem. The bigger consumer challenge would be addressing the “If and to whom to share our data with” question. Remember Yahoo! and its email breach? Perhaps this is a wake-up call for us to rethink how we want to deal with our data – what does it mean to us to be targeted and directed to think and act in a certain way? How important is it to learn about every “friend’s” life in real time? For everything has a cost. There is no free lunch ever!!

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