Despite all the controversy surrounding Facebook (NASDAQ: FB) with regard to data privacy, censorship, and just the all-around health of the platform, most people won’t give up using Facebook willingly. Even if you paid someone, they still might not give up the chance to use Facebook.
A recent study found at least 50% of Americans require $42.17 per month in exchange for giving up Facebook. The economists conducting the study estimate 95% of consumers wouldn’t accept less than $32.53 per month.
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That’s an astounding amount of money just to incentivize someone to stop using Facebook, and it shows the strength of Facebook’s hold on consumers.
Facebook is more like a utility than another social media app
Facebook has entrenched itself as part of people’s lives. It’s how they keep up with friends. It’s how they get their news. It’s how they organize events. It’s how they find interesting communities. It’s how they shop. And, most importantly, it’s where they share pictures of adorable things.
The average daily Facebook user spends over 40 minutes per day on the app. Without Facebook, they’d have about 20 hours per month to fill.
Facebook is more than a time suck, however. It’s practically a utility for many.
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A similar study in the Netherlands found users required five times as much compensation to give up WhatsApp compared to the amount required to give up Facebook. In Europe, WhatsApp is used as a replacement for text messaging.
That same study found the average user required 59.16 euros per month to give up Google Maps (compared to 96.80 euros for Facebook and 535.73 euros for WhatsApp). While lower than Facebook’s two biggest properties, there’s still a substantial gap between Maps — a utility — and typical social media apps like Instagram, Snap‘s (NYSE: SNAP) Snapchat, and Twitter (NYSE: TWTR).
Facebook investors shouldn’t worry about losing users
A loud minority of users might boycott Facebook for whatever reason, but the vast majority of users won’t be giving up the service anytime soon. By comparison, users don’t value services like Snapchat or Twitter very highly. And that’s evident in their reported metrics.
Both Snap and Twitter have previously reported user declines. Snapchat users gave up the service because they disliked some user interface changes the company made last year. Twitter saw monthly active user growth stagnate shortly after it became a publicly traded company. Facebook, meanwhile, continues to chug along for the most part, even as it surpassed 2.3 billion monthly users last year.
When negative headlines threaten Facebook and its ability to continue attracting new users and engaging existing users, users still can’t seem to give it up. After last year’s Cambridge Analytica news broke, 26% of U.S. users said they deleted the Facebook app. Facebook’s actual earnings reports suggest those users reinstalled the app shortly after if they ever actually deleted it at all. If the scandal had happened to a platform with less utility — like Snapchat or Twitter — the loss in users would’ve likely been more pronounced.
Even as Facebook makes changes to its platform or faces more scrutiny from regulators and journalists, the average user isn’t even close to giving up Facebook just out of privacy concerns or fears that they might see offensive content. Heck, even $40 isn’t enough for most.
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Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Adam Levy owns shares of Facebook. The Motley Fool owns shares of and recommends Facebook and Twitter. The Motley Fool has a disclosure policy.
