COLUMN: Has social media passed its peak?

Saul Klein at the University of Victoria writes about erosion of trust at Facebook and Twitter

Social media share prices took a beating at the end of last week, with Facebook investors losing US$120 billion of share value and Twitter ones losing US$5 billion. Both of these companies lost 20 per cent of their value in a day, along with Snapchat, which lost five per cent.

Are investors waking up to what consumers already know, that social media has passed its peak?

Facebook and Twitter have grown rapidly on the promise of greater connectivity. Along with the benefits, however, the dark side of these new technologies has come to the surface and consumer trust is eroding fast.

The annual Gustavson Brand Trust Index shows how social media brands are perceived by consumers. Of 299 brands surveyed in Canada in 2018, Twitter ranked #296, Facebook ranked # 295, and Snapchat was #294. These are also among the brands that Canadians are least likely to recommend.

If we recognize that people don’t want to do business with brands they don’t trust, the over-inflated growth projections of social media brands was clearly an illusion.

Now that it is becoming clear that the emperor has no clothes, we should expect continuing turbulence in the social media space. Continuing large increases in subscriber growth are unlikely to materialize unless the companies do something about the way they are perceived.

READ MORE: Facebook faces day of reckoning on Wall Street

What was once seen as the advent of a new era of free and open communications has turned into a nightmare of manipulation, loss of privacy and hate-speech.

Rather than new media creating strong alternatives to traditional channels, allowing a greater diversity of views with governments and other powerful stakeholders having less control over access to information, the opposite has happened. Authoritarian regimes are now more able to control content and manipulate readers and viewers.

Without legitimate gatekeepers, truth has evaporated and it is becoming increasingly difficult for consumers to distinguish fake news from any other kind.

What was once seen as a benign tool for people to stay in contact with one another, to build communities around common interests and share experiences, has become a vehicle for unscrupulous agents to use personal information to target and shape opinion. The loss of privacy has led to intervention in our democratic processes and sharp increases in identity theft and online scams.

What was once seen as a boon to free speech has created a platform for vitriol and online bullying.

Where we previously saw self-restraint on the expression of abhorrent opinions, reinforced by social norms, we now see impulsive and imprudent commentary and reaction.

Where we wanted greater diversity of opinion, we now have greater containment of views and are increasingly exposed only to those who share the same opinions as we do, reinforcing the fractionalization of our societies.

Is it any wonder that we have lost trust in social media?

In many cases, the social media brands themselves have aided and abetted the dark side. They have been slow to protect our private information, happy to sell our data to the highest bidder, and tried to avoid taking responsibility for online abuse and the spread of hate-speech.

READ MORE: Bad week in social media gets worse; Twitter hammered on Wall Street

As many other companies have come to appreciate, the route to long-term success is based on serving the needs of one’s consumers, not on manipulating and exploiting them for short-term results.

That requires building trusted relationships and behaving responsibly. Until and unless the social media brands appreciate this reality, their value is likely to continue to slide.

Saul Klein is the dean of the Gustavson School of Business at the University of Victoria

Just Posted

NorthIsle starts drilling in Pemberton Hills area after negotiating deal with Freeport

Mining industry one step closer to a revitalization after farm-out agreement

‘Police are ready’ for legal pot, say Canadian chiefs

But Canadians won’t see major policing changes as pot becomes legal

Port Hardy Fire Rescue’s open house a blazing hit

PHFR Lt. Harding explained that the organization is always looking for more recruits.

Gwa’sala-’Nakwaxda’xw Nation drafts first phase of passive housing project

The housing project will have 96 residential units for low-income families.

North Island Seniors Housing Foundation requests land from Port Hardy Council

“The foundation members will be coming to council with more information at a future date.”

Naked man jumping into Toronto shark tank a ‘premeditated’ stunt: official

The man swam in a tank at Ripley’s Aquarium of Canada

North Island Peewee Eagles shutout Comox Valley Chiefs at home

The North Island Peewee Eagles took no prisoners at the Chilton Regional… Continue reading

Nanaimo Clippers ‘clip’ North Island Atom Eagles’ wings on the road

The Nanaimo Clippers defeated the North Island Atom Eagles 6-4 on Saturday in Port McNeill.

Port McNeill municipal election candidate Derek Koel’s profile

“For over 18 years I have followed Port McNeill municipal politics and affairs closely,” Koel said.

Port Hardy municipal election candidate Don Kattler’s profile

“I believe it is time for new energy and change in our municipal government,” Kattler said.

Transport Canada to take new look at rules, research on school bus seatbelts

Canada doesn’t currently require seatbelts on school buses

Sockeye run in Shuswap expected to be close to 2014 numbers

Salute to the Sockeye on Adams River continues until Sunday, Oct. 21 at 4 p.m.

Michelle Mungall’s baby first in B.C. legislature chamber

B.C. energy minister praises support of staff, fellow MLAs

Canucks: Pettersson in concussion protocol, Beagle out with broken forearm

Head coach Travis Green called the hit ‘a dirty play’

Most Read