Why I’m Bullish On Facebook

Featuring Parents, Christmas Cards, and Social Capital

Over the past year or so, talk of Facebook’s decline has been a popular topic of conversation in the technology industry. “Tenth Grade Tech Trends,” which outlined my sister’s observations about the technology habits of her friends, was one early anecdote. And most recently, an ethnographic study of British teens concluded that Facebook is “dead and buried.”

Though I don’t have access to internal Facebook metrics, I have no doubt that (on average) the frequency with which people share content on Facebook — specifically, younger demographics — is not what it used to be, if not declining rapidly. Whether or not the product, and company, is “dead and buried” is another question entirely. In fact, despite my sister’s observations and personal critiques of certain product philosophies, I am incredibly bullish on Facebook.

Too many people are conflating “coolness” with value, and I’d like to explain why that is misleading.

Parents are a Blessing in Disguise

To be clear, declining usage amongst any demographic, let alone teens, is undoubtedly worrisome. That being said, the thing that is being blamed for the exodus of the “cool kids” is exactly what makes Facebook so defensible: Parents. Well, a holistic set of social connections, more broadly.

These days, everybody has a Facebook account. In my Newsfeed, photos posted by my Godfather are on view, right above a link shared by one of my company’s investors, directly below a high school friend lamenting about his day at work, beside a notification that my college friend “Liked” a recent comment of mine. Does this hodgepodge of social relationships (and variable expectations) lend itself to the sharing of intimate, personal media? No, absolutely not. Of course, it makes sense that people are flocking to single-purpose mobile applications that have distinct brands, audiences, and social expectations.

However, it works both ways. Do I want to send Snaps to my high school friend who I haven’t spoken to in years? See Instagram photos from my investor? Read my college friend’s tweets about the most recent Barstool Sports babe? Similarly, “no,” all around. It comes with the territory: Single-purpose apps also have single-purpose networks that are subsets of your real-life social network. As a result, they will never be as comprehensive as Facebook’s or, at the very least, it will be a long up-hill climb to get there.

Since joining Facebook, we’ve all made the same “mistake” — accepting every Friend request, from every acquaintance — and because we’ll never make the same mistake again, Facebook is all but guaranteed to be the only social network (for the foreseeable future) in which I am connected to almost everybody I know: high school friends, college friends, co-workers, relatives, and casual acquaintances, and more. All in once place.

At the end of the day, social networks are valuable for the size and density of their network (of people) — not the volume of photos shared or messages sent. In that regard, Facebook still reigns supreme, by far. Even if they are losing teen selfies.

Building a Christmas Card future

In the future, I think sharing on Facebook will become more analogous to sending Christmas Cards. Every December, you take a really nice photo and send it to everyone you know, being sure include to a couple big updates about professional happenings, relationship statuses, and travel highlights from your family members. It’s valuable, if only occasional. My hunch is sharing on Facebook will behave similarly (though at more frequent intervals than Christmas Cards). “Zuckerberg’s Law” may very well prove to be true but I don’t think it’ll happen within Newsfeed, at least not for personal content.

Which begs the question: If Facebook has a super defensible, comprehensive network, and personal content sharing amongst friends will continue to decline, where should the product go next? A couple suggestions, based on the product’s relative strengths and competitive opportunities:

Distribution of Media

Facebook is being in the unique position of being a broadcast network that is massive and already features multiple media types. “SMS” is the world’s largest social network and messaging apps are gaining in popularity but one-to-one sharing is not as efficient for distributing media as one-to-many. Twitter is famously broadcast and multimedia but their network is tiny compared to Facebook — more people check Facebook everyday than have created a Twitter account, ever.

And while newcomers like Instagram and Snapchat are broadcast and growing quickly, I am skeptical that people will ever want to read text posts in Instagram or share URLs via Snapchat.

Maybe, but doubtful.

To date, Facebook has been obsessed with encouraging friends to share personal photos and life updates, and the product design decisions that enable this type of behavior tend to be at odds with those that attract (professional or avid) content creators. Prominently providing vanity metrics like view count and audience size, for example, rewards publishers and encourages repeat behavior. If Facebook ever decides to shift hearts their to attracting media publishers, celebrities, and generally owning the “News” part of Newsfeed (a la Twitter), they will be a formidable player. (To be fair, it looks like they’re already trending in this direction.)

Twitter has attracted these demographics of content creators (the 1% of content creators, if you will) because their brand marketing emphasizes “reach” and their product puts follower and retweet counts front-and-center. Lady Gaga has 41million followers, and top tweets get retweeted hundreds of thousands of times. However, if Facebook ever decided to play ball they could play it well. For comparison, Lady Gaga has 66 million Fans on Facebook, and Vin Diesel’s post about Paul Walker was liked 6.7 Million times. However, scale is the enemy of intimacy. You want photos of your kids to end up with the right audience, not the largest one. So Facebook is going to have to pick their battles.

Along these lines, some food for thought: One thing that everybody does a lot on computers is “surf the internet” — entertaining themselves by jumping around from content site to media type, and back and forth (often for hours at a time). That’s a behavior which is currently really hard (if not impossible) on mobile phones and no single app has successfully replicated that addictive experience yet. With Facebook’s scale and data, you can imagine the company building a standalone app (or evolving Newsfeed) to become your personalized television channel and newspaper.

Skeptical? The most successful media publishers of the day are already acting under that assumption (e.g. BuzzFeed, Upworthy). In fact, they are building budding businesses that revolve around that very worldview. Facebook just needs to run with it themselves.

Social Capital

Before starting Branch, I was a Sociology major at Princeton. Specifically, I was obsessed with the notion of “social capital.” Serendipitously, it was social capital (a pun of sorts) that introduced me to the world of technology startups. The godfather of the sociological concept, Professor Robert Putnam, suggested I spend the summer interning at a company that he was an advisor to: Meetup (Scott Heiferman started the company after reading Putnam’s book, “Bowling Alone”).

Anyways, what Professor Putnam and Scott Heiferman and others have realized is this: There is value in social connections that extends far beyond your emotional relationships. The people you know have employers, prior experiences, physical assets, intellectual resources (and so on and so forth) that are accessible, and may be of value to you. For those of you who operate in the world of startups, you see your social capital at work when people make introductions for you, send employee referrals, offer advice on scaling and product design, etc. It’s a powerful concept, even more so in a world in which peer-to-peer marketplaces and services continue to trend towards becoming mainstream and socially acceptable.

Back to Facebook now: While being connected to my co-worker, Godfather, high school friend, investor, college friend, and casual acquaintance in one place may make it unappealing for sharing personal content. What about finding a new job, or a date? Tracking down a place to crash, or travel advice? Soliciting buyers for my unused valuables, or referrals for service providers? For utilitarian needs Facebook’s more comprehensive social network, and access to a greater number of mutual connections, is a huge asset. Sure, there have been attempts at these concepts in the past — on and off of the core Facebook product — but as investors say, timing is everything, and the timing may be just right.

Perception Trumps Functionality

Whether Facebook becomes your personalized media channel, job site, or something else, I am most convinced that the company needs to build new product offerings as standalone, separately branded apps. There are some use cases where the Facebook brand may be of value — attracting celebrities and media publishers, for example — but by and large the Facebook brand comes with a lot of baggage (e.g. privacy, parents), and consumer perception is everything.

You wouldn’t think that Twitter is as (relatively) small as it is because that company has done a wonderful job building their brand — you perceive it as megaphone to the world with massive scale and reach. Similarly, you wouldn’t think that Instagram is one of the most public social networks on the internet (every photo is public by default), because that company has done a wonderful job building their brand — you perceive it as an intimate space for a selective group of your friends to exchange special moments with each other.

Conversely, “messaging” may be the social interaction of the moment, and Facebook may be trailing competitors in this category but not too long ago they were ahead of their time! In 2011, they bought Beluga — one of the first mobile messaging apps. Problem is, they morphed it into Facebook Messenger, which feels and operates as a sub-product of the core Facebook experience, and thus carriers brand baggage.

Arguably, if Facebook had kept Beluga as a standalone, separate brand, they would be winning the “messaging wars.”

Similarly, if Poke — the company’s Snapchat knock-off — wasn’t so tightly integrated with the Facebook network and brand, I imagine it would’ve seen more success.

If the next Facebook products are going to be successful, and truly take advantage of the size and density of their network, my hunch is they’ll need to spend as much time working on (new) brand design as they do on product design.

At the end of the day, parents are a blessing and a curse.