Alessandra Ambrosio and models backstageZuhair Murad show, Backstage, Fall Winter 2018, Haute Couture Fashion Week, Paris, France - 04 Jul 2018

Social media may be down, but it’s not out.

In their second-quarter earnings reports, some of social’s biggest players revealed declining user figures, with losses in daily active users across Facebook, Twitter and Snap Inc. numbering in the millions. Cue the hand-wringing.

The downturn across the social giants may seem like a sign of things to come — as if the sector has peaked and is fixing to head into the sunset. But don’t buy it, say the experts.

“If you look at how much marketers are publishing on Facebook, Twitter, Instagram, YouTube, that’s still not peaking,” said Mario Natarelli, managing partner at marketing firm MBLM. “Consumers themselves are still very active on those platforms. You’re not seeing triple-digit growth, but the time spent, the level of engagement is all there.”

As a single metric, user counts only paint a partial picture. Clearly engagement matters too, maybe even more so, and that activity hasn’t fallen, it’s grown.

“The average U.S. consumer was engaging more with branded content now, than before. So for the numbers at least, all signs point straight ahead and upward,” said Tania Yuki of social intelligence firm Shareablee. “In terms of consumer engagement on social media, retail and fashion massively outpaced the average U.S. brand, growing 52 percent and 49 percent, respectively.”

So rather than a cooling-off, the decline in users looks more like a temporary contraction, with the major platforms reconsidering some important fundamentals of their businesses.

Put another way, it’s a growing pain. And when it’s over, social may be stronger than ever.

The “Follower” Model

Facebook, Twitter and Snapchat are having a moment of deep reflection. Snap blames its downturn in user growth to an unpopular app redesign. It’s more complex for Facebook and Twitter, as external factors like politics and bad actors force them to confront things like privacy, security and fake news.

The result is the same: These networks are taking a harder look at who they are as a company and what they stand for. To put it bluntly, it’s an identity crisis. Contrast that with other platforms that have a clear sense of who they are, what their users want and how to expand on that. If success is the best teacher, then there are plenty of lessons available in other parts of the social media universe.

At YouTube, advertising impressions more than tripled year over year in the second quarter. Ad spending more than doubled compared to the same period last year. For Pinterest, ad sales are quickly approaching $1 billion. It’s reportedly looking to go public next year, and analysts are pegging its valuation between $13 billion and $15 billion.

Both have invested deeply in mobile strategies — including optimizing for the rise of mobile video viewing, computer vision using smartphone cameras and other features — and those efforts are clearly paying off.

But when it comes to success stories, it’s hard to overlook Instagram.

Unlike parent company Facebook, the photo-sharing network’s star continues to rise. The company hit a milestone this summer, reaching a billion users, and it’s become the belle of the ball in fashion, as well as an essential part of a brand’s social strategy mix.

It’s also big business. EMarketer estimates that Instagram will pull in $5.48 billion in ad revenue this year, making for a meteoric 70 percent rise over 2017. Its Instagram Stories alone serves as many as 400 million daily active users. That’s more than double Snapchat’s entire user base.

When it comes to Snapchat, that math may be a little cold-hearted. After all, Snap originated the Stories model, and now it must watch as its top competitor, Instagram, uses the feature to add rocket fuel to its growth.

According to RBC Capital Markets, about 31 percent of Instagram’s users share a Story monthly, up from 21 percent last year. And 47 percent watch Stories at least once a week, versus 32 percent in 2017.

“A big component underlying Instagram’s success is that it is a visual-first platform, compared to Facebook or Twitter, which are more text-heavy,” said Jasmine Pickel, vice president of social media for brand communications agency N6A. “As attention spans continue to erode, instantly consumable content will be preferred, which is a large reason behind the higher engagement rates we see with video content.”

Visuals are fundamental to Instagram’s DNA, and the company is building on that framework — from its new IGTV video platform to its expanding visual shopping powers. Even its text-oriented offerings, like reservations and payments, mirror the ethos, with clean interfaces focusing on ease of use.

“Instagram’s most effective feature is also its simplest: swiping up to link to different landing pages. Its popularity is undeniable, as 79 percent of analyzed brands consistently use the swipe-up function,” wrote Gartner L2’s Alizah Farooqi, in a post covering the firm’s Instagram research report. “Brands should pay attention to the burgeoning platform and its plethora of features, which when used properly, can turn a like into a swipe into a buy in seconds.”

Instagram’s understanding of what it is and why people flock to it may be its secret sauce. And that’s striking, considering how its own parent company struggles with this issue.

The Politics of Social

Facebook has a newfound sense of responsibility — or at least, that’s the image it wants to project after getting caught flat-footed by the Cambridge Analytica scandal. The firm’s unauthorized use of Facebook user data to target voters in the 2016 presidential election put extra scrutiny on the social giant’s data handling and privacy practices.

Facebook’s chief executive officer Mark Zuckerberg, appearing before Congress last April, told lawmakers: “We didn’t take a broad enough view of our responsibility, and that was a big mistake.” The company pledged to secure the network, foster authentic connections between users and safeguard their data. And Zuckerberg warned investors — multiple times, in fact — that addressing those matters won’t be cheap. Or easy.

The company plans to double its security staff to 20,000 this year, as it ramps up efforts to block bad actors from its platform. Recently, it booted as many 652 accounts based in Russia and Iran, and it removed more than 5,000 ad-targeting options. In an effort to curb the spread of fake news, Facebook even plans to rate users based on trustworthiness.

Then there is its own existential question as to how much content it should be monitoring. The New York Times recently reported that dozens of employees have joined a group to ensure more conservative political views are not blocked from the site — a charge President Trump also made this week by claiming Google favors liberal viewpoints in search results over right-wing ones.

Facebook isn’t the only platform coming to grips with its role on the world stage. Twitter, now the unofficial megaphone of the President of the United States, has been grappling with its own existential crisis.

Twitter ceo Jack Dorsey acknowledged as much during a media tour recently: “We have to understand, first, the problem we’re trying to solve. Like, what incentives we actually want to drive,” he explained. At a minimum, Dorsey knows that one of those incentives is to “encourage people to talk and to have healthy conversation.”

The messaging network has always seen itself as a platform of expression, and it’s reluctant to mess with that — even when the company really wants to.

Despite being “left-leaning,” as Dorsey put it, his company didn’t rush to follow Facebook, YouTube, Apple and Spotify’s cue and ban InfoWar’s Alex Jones. Instead, it temporarily put the conspiracy theorist’s ability to tweet on ice, citing his inflammatory rhetoric as violations of Twitter’s terms of service.

In their own ways, both Facebook and Twitter seem to be going through an identity crisis, and it’s triggered some deep corporate introspection.

Arguably, both companies should have thought through the potential impacts of their platforms and policies earlier on. They’ve had plenty of opportunity. For years, they’ve been besieged by privacy issues, bots and troll-like behaviors, among other things.

Now that politics has forced their hands, they appear to be reconsidering some core issues — including what they stand for, how their platforms could be weaponized and how their practices or policies could affect people in the real world.

However they arrived at this juncture now, they’ve come to a critical point in their evolution. And what they do next will likely end up defining them.

Change Is a Snap (Or Not)

Snap’s identity crisis takes on a different timber. As opposed to Facebook and Twitter, which have been contending with outside forces, Snapchat has been struggling with internal challenges.

The company’s deeply unpopular revamp didn’t just miss the mark — it revealed a fundamental misunderstanding of why its users loved the Snapchat app in the first place.

“It’s about a platform staying true to what it is,” MBLM’s Natarelli said. “What I loved about Snap is that it owned the emotion of joy.”

The very nature of Snapchat’s ephemerality put “of the moment” images and videos front and center. Shares felt more organic, less manufactured or produced. And the feeling of timeliness gave it an aura of authenticity, which is an extremely rare and valuable trait for brands and the consumers it wants to reach.

The app spoke to a younger audience, who felt deeply connected and invested in their favorite Snapchat brands, celebrities and influencers.

“When you watched people using Snapchat…it was really intimate,” Natarelli added. “It’s a hard thing to create.”

But Snap did create that. Then the redesign surgically removed it.

Users could see updates from, say, Taylor Swift alongside real-world friends, as though Tay was just another girlfriend. So when the update separated real friends’ posts from that of brands or publishers, the illusion of intimacy was gone, replaced by a much-criticized and difficult-to-use interface.

It was as if Snapchat didn’t know, didn’t understand or simply didn’t remember what the platform was or why users flocked to it in the first place.

The outrage poured in. A Change.org petition — which now features more than 1.2 million signatures — demanded the update’s removal. Mere weeks after the launch, Kylie Jenner threw shade at the app on Twitter, wiping out $1.3 billion in Snap’s market value.

“If you don’t keep giving [consumers] what they want, they will put their attention elsewhere,” said Shareablee’s Yuki. “So you do have that pressure to constantly be innovating. But doing that inside the sweet spot of what made you special in the right place is tough.”

Snap ceo Evan Spiegel blamed the new layout for its decline in daily active users, and his company scrambled to course correct, effectively redesigning the redesign.

Meanwhile, Snap has been delving into other projects, like a new version of its Spectacles AR glasses, a somewhat underwhelming Snap Store, and some promising partnerships, among other things. It’s also doubling down on social commerce in various ways — from in-app shopping to its most recent pre-release of Adidas’ new Originals sneaker, the Falcon W, through a Snapchat show.

The thorough measure of those efforts may not be evident for a while, though. Snap warned that its third quarter historically shows reduced user growth. That would put extra pressure on the fourth-quarter holiday season for the company to prove that it hasn’t lost its mojo.

For now, Snap optimists may be better off looking beyond the company’s daily active users to its other numbers. There were some positive second-quarter figures in the mix as well: Snap still wound up beating expectations, and revenues jumped 44.4 percent year over year to $262.3 million. And although DAUs were down, monthly active users were up, hitting 100 million.

Here’s another, somewhat unusual, tidbit: Despite its track record appealing to teens and young adults, Snap reported 8 percent growth among users over 35.

Social Matters

Regardless of what happens to these three platforms, social media — in a broad sense — will probably never go away. It will endure as long as people are fascinated with taking and sharing selfies. In other words, a long, long time.

Not that pundits haven’t been predicting the demise of social media for years, and a parade of services and technologies have come in and out of vogue — MySpace, Friendster, even old Nineties-era chatrooms and Usenet groups.

But people are wired as social creatures, and the communication tools are only growing more sophisticated. Platforms mature and take on new characteristics, input mechanisms and contexts all the time — whether it’s an experience on a phone, in a shared virtual reality room or through some other medium.

And no matter how or where consumers congregate, advertisers will want to connect with them there.

“Brands will continue to focus their strategy around where their audiences are, and how social is used and what it looks like will evolve,” said Lizz Kannenberg, director of brand strategy at Sprout Social.

“The vast number of users already on social media are providing brands access to more people than organic and paid efforts will ever be able to reach, suggesting advertising dollars won’t be going elsewhere either anytime soon,” she added.

Those ad dollars help power the experience and ensure the development of the next generation of technologies.

In the here and now, that means Snapchat, Facebook and Twitter have plenty of incentive to work through this awkward growing pain, not to mention long financial runways. But they’re not the only torchbearers. Platforms like Instagram, Pinterest and YouTube have already staked out territory and they’re growing at a rapid clip.

“We’re not even close to ‘peak social’,” said N6A’s Pickel. “Social isn’t going anywhere — we’re just learning how to use it in healthier ways.” That includes a growing emphasis on digital wellness features, such as Instagram’s “You’re All Caught Up” feature. The tool makes it easy for users to know when they’ve parsed new posts from the previous 48 hours, so they don’t have to check in constantly. The goal is to help curb social media addiction.

The theme goes back to Silicon Valley’s larger war on tech addiction, with companies like Google and Apple providing users with insights into their behavior. Facebook joined the fray, having revealed an upcoming screen-time management dashboard so users can manage their time on Facebook and Instagram.

“It makes social media use more sustainable for the long term,” Pickel added. “People don’t have to cut it out if they use it in healthy ways.”

Sounds like social media’s not just growing up, but settling in for the long haul.

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