When Mark Zuckerberg began his fledgling social network back in the mid-2000s, not even he could have known the goldmine he had created. From humble beginnings as a Harvard-only social network to the global juggernaut it is today, Facebook is a global icon that stands above competitors as the go-to social network for billions of people across the world.
But like Icarus himself, has Facebook soared too close the sun? Many people thought Facebook too big to fail, but with another scandal enveloping the company regarding data harvesting, is the social media giant about to be cut to size?
Since news broke regarding the extent to which Facebook stores and harvests users data, the company has seen nearly 20% wiped off its share price and the value of those shares is still falling at the time of writing. With the value of the firm plunging by almost $50 billion since the outcry, it is the biggest loss of confidence in the stock market since the company was floated in 2012. With hordes of users supposedly turning their backs on the site, Facebook is going through its biggest crisis yet.
In response, Zuckerberg has been in overdrive trying to save face. Full page ads were taken in leading British and American newspapers with the major headline stating ‘We have a responsibility to protect your information. If we can’t, we don’t deserve it.’ There has also been some talk of self-regulation, but that sounds like pre-emptive action and with Zuckerberg set to be called before Congress over in the States, we can expect a crackdown on the social media giant that became too big for its boots.
But with social media becoming an ever-increasing channel for commerce and marketing, where does that leave those of us who operate within the industry?
There are two ways that this could pan out. Option one is as follows: Facebook’s influence rapidly decreases and as users turn to other platforms, so too will those in digital marketing and major companies will instead advertise elsewhere. The thing that Facebook has done successfully is embed the idea of a social network in our minds and if people leave Facebook, they will still ‘need’ another platform.
However, that seems potentially unlikely, as there has long been chatter that people were going to be turned away in droves from Facebook, but at 2.1 billion users, it will take a seismic migration away from Facebook for advertisers to leave the site.
Instead, what looks more likely than a mass exodus is that this will all blow over. A few years ago when it was revealed that Google had accepted neo-Nazis and hate groups into its YouTube Partner Program, firms fell over themselves in trying to distance themselves from the platform. With ads appearing side-by-side with ISIS-inspired videos, brands were unwittingly funding terrorist groups.
Yet what happened next rings very familiar with the Facebook scandal. Firstly, Google took a massive hit on its share price, forcing the company to apologise to all and sundry. Then the regulators waded into the storm and demanded answers as more major players, including the likes of McDonalds and Audi, turned their back on YouTube. However, Google put in place a few quick fixes and grovelled to the world as their engineers got on the case to work out a solution. With Google seen to be acting, companies had the perfect cover to start using the site to reach out to over 1.5 billion users once again.
A similar thing will surely happen with Facebook, 100 million people could leave the site over the Cambridge Analytica events, but that would still leave 2 billion users on the site. It will remain the biggest marketplace in the world and in today’s era of fast-news, there will no doubt be a scandal somewhere else soon enough that will draw people’s attention. The advertisers will continue to push their ads, the majority of users will still use the site and things will carry on as before.