As astounding as these statistics are, they only represent a modest portion of individuals in these age groups (with particular attention to those under the age of 12). Facebook prides itself on having over 900 million users globally, and it is important to publicize and continue increasing that number as it helps structure the company’s advertising models.
Currently, more than 85 percent of Facebook’s revenue stems from advertising. Moreover, we are seeing a trend in the social media industry in which platforms are putting more emphasis on the number of users they have at any given time. Largely due to the diversity of the platforms, that user-based metric is increasingly used to measure one social site against the next.
Facebook actively lowering its minimum age would invite a new, younger audience and could push its user-base over 1 billion people -- in turn, that would likely bring in more advertising dollars, help offset a recently disappointing IPO and breath new life into the company’s operations.
The projected model would require parents to link to their children’s accounts which would then allow them to control who they “friend” on the network. Facebook sees revenue potential in this model as children are more inclined to purchase games and Facebook credits.
While all indicators point toward this move helping Facebook increase its key metrics, Internet security experts already have concerns over the online security of America’s youth. Capitol Hill has already had a busy year chasing privacy concerns and anti-trust litigation with other companies including Google, Apple, and even Facebook. Should the minimum age requirement be dropped, we could see a whole new type of privacy concern debate in Washington.
I believe Facebook would be better off restructuring its advertising model to include additional channels, including expanding its Facebook credits and enhancing games and applications. Roughly 12 percent of Facebook’s 2011 revenue came from its partnership with Zynga, Inc. and its gaming interface. Furthering these types of partnerships and expanding the company’s gaming offerings would allow Facebook to generate more revenue, particularly from the 14-21 age bracket.
As the projected model evolves, we can expect to hear more debate on the Hill, which has already spent most of 2012 battling other privacy concerns in defense of America’s youth.
Kenneth C. Wisnefski is an online marketing expert and founder and chief executive of WebiMax, an online marketing firm in Mount Laurel, N.J., specializing in search engine optimization, search engine marketing, pay per click management, social media marketing, and reputation management.
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