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Facebook has a young people problem - and so do brands

snapchat facebook phones gen z

Facebook earned just under 20% of all digital advertising spend in the US last year. The reason for that is that Facebook’s user data set is the deepest and broadest ever compiled. It’s absolutely crucial to modern digital advertising, not just on Facebook and its owned platforms, but on the rest of the internet as well.

That’s because cookies can be used to link browsers to their Facebook identities (hashed and anonymised, but real nonetheless) and this is what powers the relevancy and compelling nature of successful digital ad campaigns.

What’s the problem with Facebook and Gen Z?

Young people are leaving Facebook, or not ever starting to use it. A Pew study showed that only 51% of teenagers (13-17, US) said they used Facebook, down from 71% in 2015. Even worse for the platform, only 10% of those said they used Facebook the most often, out of the available social networks and apps.

Instagram seems to have cannibalised a significant amount of Facebook usage, which might not seem like a problem considering that it’s owned by Facebook, but Instagram does not collect anything like the same depth and breadth of data that the primary Facebook platform does. Other competitors for teens’ time and attention like Snapchat and YouTube have been prominent in taking away Facebook’s dominant position of a few years ago.

All this means that Facebook’s userbase is growing older with the platform, and its largest growth segment is amongst older users (55+) according to eMarketer. The lack of traction with younger audiences is a real problem for the future of Facebook, but more importantly it’s a challenge for the present for brands and retailers who focus on this audience. The increase in older users may also represent part of the reason younger users are leaving the site. How many teenagers want their parents, grandparents and extended family to be able to look over their digital shoulders when they’re hanging out with friends?

Finally, young people are likely to put a high value on a brand’s perceived ethical status – and this goes for Facebook too. As more scandals continue to drag the platform’s reputation into the mire, Generation-Z and millennial users will tend to spend less time there, and the association for brands who continually appear in sponsored posts and adverts on the network could extend that tarnish to the retail brand.

What should retailers and brands do?

It seems that there's a clear shift coming in the way that shoppers engage on social media and generate digital identities. This set of changes is going to mean brands have to adapt their strategies.

Step one is to diversify. This could mean moving some digital advertising spend away from Facebook to other channels. Selecting the right channels is crucial – options include the likes of Snapchat and YouTube which have successfully stolen mindshare from Facebook amongst this audience; but others are available.

Amazon has the largest share of digital ad spend outside of the Facebook/Google duopoly, and retailers are often attracted by the premise that Amazon data is centred on purchasing behaviours, putting them much closer to the bottom of the funnel than Facebook or Google can. Amazon’s advertising offering is broad and includes options away from Amazon.com thanks to its publisher network.

However, retailers and brands must take care when broadening their advertising channels. While there is often understandable excitement about the possibilities offered by the likes of Snapchat to directly engage young shoppers, lame attempts at relevancy can have a massive reputational penalty.

One viable approach for non-native brands is starting small and testing different creative options to minimise risks before upping investment. There are also a whole breed of publishers who have maximised Snapchat’s stories function to deliver their content, who can partner with brands to give them a leg up.

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