Call it was the meltdown that wasn’t.
As Facebook prepared to announce its quarterly earnings January 30, there was a lot of public speculation that its scandal-ridden year might finally scare away advertisers and members.
The doubters were wrong.
Here’s what Facebook announced:
- A 9-percent year-over-year increase in monthly active users, with 2.32 billion as of December 31, 2018.
- Fourth-quarter revenues of $16.9 billion, up 30 percent year-over-year. That number beat Wall Street’s expectations of $16.4 billion.
Facebook is not only weathering months of data-privacy scandals, it is actually getting stronger. At True Interactive, we’ve shared our concerns about Facebook’s scandals and their possible impact on advertisers. We still think it’s important that advertisers watch Facebook closely. The threat of government regulation looms large. The number of fake and duplicate accounts are on the rise, by Facebook’s own admission (116 million fake accounts and 255 million duplicate accounts exist on the site). But advertisers should also be aware of some other numbers:
- 93 percent of Facebook’s advertising revenue comes from mobile.
- 500 million people use Instagram Stories daily.
- 2 million advertisers are now focusing on Stories.
Stories play a big part in Facebook’s growth plans for 2019, which Mark Zuckerberg published in a Facebook post. I have excerpted some highlights and used boldface to emphasize some points that jump out at me:
Messaging is the area that’s growing the most quickly, and this year people are going to feel these apps becoming the center of their social experience in more ways. We’ll roll out payments on WhatsApp in some more countries. Private sharing in groups and stories will become more central to the experience. We’re going to onboard millions of more businesses that people can interact with.
On Facebook, I also expect this to be the year where Watch becomes more mainstream. There are now 400 million people who use it every month, and people spend on average over 20 minutes on Watch daily. This means we’re finding ways for video to grow outside of News Feed so it doesn’t displace the social interactions that people primarily come to our services for.
In Instagram, one of the areas I’m most excited about this year is commerce and shopping. There’s a lot of natural activity happening here, and this year I expect us to deliver some qualitatively new experiences around that.
Longer term, I remain very focused on building technology that brings people together in new ways, including through AR and VR. I’m looking forward to Oculus Quest shipping this spring — the feedback there so far has been very positive.
The numbers tell me this:
- Advertisers need to understand how to capitalize on messaging. In September I wrote an Adweek column about Facebook monetizing WhatsApp. Clearly, Facebook is going full steam ahead here.
- If you aren’t using Stories, you’re behind. Stories are now table stakes for brand building on Facebook’s platform, which includes Instagram Stories.
- Figure out how Facebook Watch plays into your strategy. So far adoption numbers are underwhelming. But these are early days. The success of Facebook Live shows that Facebook knows how to make video a branding platform.
- Integrate your Instagram with commerce. Brands are getting better at giving users compelling reasons to stop scrolling and buy. Expect new features to make social shopping more of an experience.
- Augmented reality and virtual reality are branding plays for forward-thinking businesses, but AR and VR still have a long way to go.
Facebook is not as weak as its doubters said it was. Neither is Facebook as powerful as some would have you think. The company has issues. It’s not the cool place for Gen Z to hang out. A potential recession coming up could take a bite out of its advertising revenues. And as I mentioned, regulation is a constant threat. But Facebook remains a strong platform for advertisers with exciting features worth embracing. For more insight into how to succeed with digital media, including Facebook, contact True Interactive. We’re here to help.