Meta just posted its 2021 Q4 and full-year performance report, showing a rise in monthly active users and significant revenue growth as it continues to evolve towards the next stage of digital connection. However, it’s not all glitter and gold, as the report also notes certain concerns with Facebook’s growth, with certain aspects even in decline, reflecting a growing disinterest with the platform specifically.
Facing Reality
To start, let’s take a look at Active Users. Facebook rose by just 2 million monthly actives since Q3, which also happens to be the slowest quarter-on-quarter growth rate it has ever experienced. However, for Meta, the bigger concern lies in daily active users, where Facebook actually declined, marking another first. Based on the charts, while it added users from the Asia Pacific and Europe, overall, it lost about a million daily actives.
Honestly, that’s a lot. Even without all the graphs and fancy charts, knowing that around one million people decided that they no longer needed to check into Facebook every single day is a significant count, and might even be more than what’s declared since Facebook was able to add users from other regions.
Is that a problem? Well, yes. Think of it this way, everyone who’ll ever use Facebook is on it now and there aren’t that many new people left to add, meaning that once audience reach begins to slow down across all other markets, it could pose a serious issue for Facebook’s broader growth.
The fact that Facebook showed a decline, especially during the Christmas period, is indeed concerning. This is likely part of the reason why Meta also announced a shift to refocus on winning back younger audiences last year, as well as explains the emphasis it’s putting in its current Metaverse push. Looking at things carefully, most of Meta’s latest advances are towards solidifying what would eventually be the foundations of the Metaverse, with increased revenue due to higher VR sales, which brought in around $877 million in Q4.
On the topic of daily active user loss, it could be that the repeated criticisms due to last year’s Facebook Files Expose, as well as evolving online behaviors that have users more concerned about their privacy and the growing prevalence of the spread of misinformation and hate culture, has swayed many a user to reduce if not completely cut their daily consumption of Facebook content.
The Wrap
In the end, we are hurled straight back into the dynamics of trade-offs – to move forward, Meta must embrace certain losses, this has come to be an inevitability in business, especially for a company as large as itself. Evolving user behavior will have them gravitating towards either newer platforms or the same platforms that showcase newer, more engaging innovation, which should now be one of the key foci of Meta as it continues to develop its Metaverse.
So far, support for the Metaverse has been plentiful, with businesses and consumers opening up various discussions around the subject. Perhaps the loss of a million daily active users equates to the eventual addition of monthly actives, which will still play a big part in gauging the company’s overall performance.
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