![]() ![]() ![]() Facebook and Instagram have become familiar programs, where a significant part of the feed has increasingly replaced user-generated content with advertising. They create desire and make us fantasize about them. ![]() The best and most successful brands make us dream. When brands are not seen as innovative anymore, their appeal fades.īrands like Meta that want to create extreme customer value must continually innovate and influence their field, especially with the youngest generations. When brands only react - but do not lead - they lose their “trailblazing” appeal, especially to the newer generations. It added functions like “stories” after the launch of Snapchat, and “reels” were inspired by TikTok’s short video formats. Instagram was once an innovator and disrupter that, over time, lost the ability to innovate. In many of my publications and strategy projects, I have consistently highlighted two critical aspects: brands that want to create extreme customer value must be seen as innovative and influential, especially to new generations. Losing market leadership to TikTok indicates a significant risk for the future relevance of the platform. This story presents us with another lesson: To be future-ready, brands must over-index with the future generation. The Financial Times reports that “younger users are fleeing to the likes of TikTok,” citing a Forrester survey, which states that the weekly usage of TikTok surpassed Instagram among 12 to 17-year-olds in the US in 2021. Meanwhile, Facebook and Instagram have not managed to be nearly as relevant as emerging competitors like TikTok in capturing the interest of Gen Zers. These changes further weaken brand equity and the platform’s value, instigating a precipitous value drop, as with Meta’s brands. A seemingly endless array of PR disasters, including a damning report from a whistleblower on the potentially negative effects of social media on kids, may have led some brands to pull back advertising and some customers to leave the platform or reduce usage. Reputational damage will create an exponentially worse problem. And when the value perception of a brand drops, it can take a long time to reverse that course. ![]() If customers perceive the value of what it produces to have significantly declined, they will be less willing to purchase (or will only buy at lower price points). The Financial Times reports that Meta has seen a $10-billion revenue decline since these privacy changes took effect, causing potential long-term damage to its entire business model.Ĭonsider this occasion to be a reminder for all brands: A company can only charge for the value it creates. This disruption is likely here to stay and will make it significantly more challenging for Meta to be precise in targeting ads, thereby reducing the value of their advertising. And evidently, many seemingly have decided to opt-out. Users of Apple’s ecosystem now have much more control over how they want to share their data with third-party brands like Facebook. Some of the issues surrounding the business model of Meta’s platforms like Facebook and Instagram seem to come from significant external disruptions, most notably Apple’s modification of its privacy rules. When a historic shockwave hits, it’s worth taking a closer look as it can signal a broader, more fundamental change in the market. ![]()
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