Skeptics of Facebook’s business model have long pointed to anecdotal evidence that the social network is losing its luster with teens as evidence that the firm will ultimately be unable to justify its $140 billion valuation. Indeed, even Facebook itself admitted last fall that it had lost younger users. “We did see a decrease in [teenage] daily users [during the quarter], especially younger teens,” Facebook chief financial officer David Ebersman said during a call with analysts.
But it’s always been difficult to gauge exactly what the magnitude of this lost interest has been. On Wednesday, the digital consultancy iStrategy Labs released a study that draws from Facebook’s Social Advertising platform to glean exactly how many young users have left the social network in recent years. The resulting estimates are pretty staggering. According to iStrategy, Facebook has 4,292,080 fewer high-school aged users and 6,948,848 college-aged users than it did in 2011. Check out the data below:
Advertisers covet younger audiences because their taste in products are more malleable, so these data could have a significant effect on the ad rates Facebook can charge.
On the other hand, advertising on Facebook isn’t just about its massive reach with younger users. A big part of Facebook’s pitch is that it has so much information about its users that it can more effectively target ads to those who will be responsive to the content. If Facebook can prove that theory to be true, then it may not worry so much about losing its cool cachet.