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Facebook’s user retention strategy: If you leave me, can I come too?

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via Flickr © Franco Bouly (CC BY-ND 2.0)

One thing Facebook has done really well is to predict where its social media competition is about to come from -  and then buy it quickly before it does any damage.

It bought Instagram in 2012 for just $1 billion, just as it was beginning its hockey stick growth curve. Instagram subsequently grew its user numbers by 23 per cent per year, far faster than Facebook itself, so the $1 billion, thought to be an improbably large number at the time for a start-up, has proved to be a canny investment. By the end of last year Instagram had 300 million users.

Then came WhatsApp. This time the prey was valued in the transaction at $19 billion. Surely Facebook had really overpaid this time? Maybe, time will tell. But WhatsApp too, perhaps partly BECAUSE it had been bought by Facebook, has also done very well, helping Facebook to remain in a dominant position in social media by keeping a large share of the messaging market.

It’s uncanny - almost as if Facebook had access to a huge database of social interactions to enable it to predict with certainty when its young(ish) user base was starting to get restless and where it was likely to go. Oh yes, it has.

Just as well, Piper Jaffray has been doing the numbers and it turns out that while Facebook itself is still the dominant social media network worldwide, younger users tend to consider other sites more important.

Instagram, it says,  is considered the "most important" social media by 32 per cent of teens, while Facebook polled only 14 per cent (Twitter was second at 24 per cent). Snapchat (which treats interactions as digital conversations, lasting just a first view after which they self-destruct) is cited by 13 per cent of teens as the most important (NB: on a par with Facebook).

This doesn’t mean that teens are dropping Facebook and moving as one to Instagram and Snapchat. Rather they keep their Facebook pages, but just spend less time there, more time on the other platforms generating more interactions.

Perhaps the interesting question is whether they will tend to ‘graduate’ to the more sedate Facebook as they get older, there to spend more time exchanging kitten pictures and clicking picture-likes. Or will they take their current social media habits with them up the age range so that they’re still exchanging snaps of their genitals into their dotage. Please God No!

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