Facebook Tries To Re-Friend Teens
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Facebook Tries To Re-Friend Teens

Jon Markman

Facebook (FB) is obsessed with winning. So it brought in a 19-year-old prodigy to change its fortunes in the one demographic group it is still losing.

Facebook’s rivalry with Snapchat is longstanding. On a number of occasions, it tried to buy the teen image-snapping favorite. Every time it was rebuffed. It even launched competitors that bore a striking resemblance. Poke and Slingshot both went down in flames.

So now it is rebooting. Its Instagram unit recently launched Stories, a direct rip-off of Snapchat Stories. And last week it launched Laststage, a stand-alone application built by coding whiz kid Michael Sayman.

Born in Miami, Florida, Sayman has been a successful app entrepreneur since age 13. He taught himself how to program iOS by watching tutorials on Google. He eventually made enough money to help his parents pay their mortgage during the real estate crash.

One of his most popular apps is the game 4 Snaps. With this app, a gamer chooses a word, shoots four photos to illustrate the word and sends the photos to another player. Then that player tries to guess the word. Teens went wild over 4 Snaps.

Facebook hopes Sayman’s Laststage will be as viral and cool with teens as his other apps. Facebook needs it. Today’s teens are coveted by advertisers. They are affluent early adopters. They are trendsetters. They are gatekeepers.

Snapchat skillfully excluded older people.

Snapchat won this demographic by treading where established companies like Facebook would not go: It skillfully excluded older people. The music industry has been doing this for decades. From Nirvana to Lil’ Wayne, older people were never supposed to be attracted. The learning curve was too steep.

Snapchat’s user interface, heavy on swipes, taps and visual cues could just as easily be the plot line of Johnny Mnemonic to anyone outside the targeted age group. Don’t underestimate the appeal of reaching today’s young people.

A Nielsen study found 29% of teens live in households with incomes north of $100,000. Because they have grown up immersed in the information age, they are the ones who often school their parents on products and services worthy of their family’s disposable income.

They’re certainly the ones enlisted to help Grandma learn to Facetime or set up the new family flat-screen TV they picked at the local Best Buy. Advertisers know this. It’s their lifeblood and they want to get in front of the kids now, to make their case before loyalties evolve.

And Snapchat is obliging with a massive expansion of its advertising network, new application program interfaces (APIs) to help third parties participate, a pledge to get to $1 billion in sales and a workforce now 900-strong to make it happen quickly.

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Internal Sponsorship

Facebook is fighting for those same advertisers. Laststage pulls its user experience straight out of the 2004 Facebook launch. When you download the app, you will be asked to submit your high school, likes and dislikes, sad and happy faces, even your dance moves, in the form of a short video clip.

And, as long as 20 people at your school sign up, you can watch and exchange video clips. The lone caveat is you’ll need to prove you’re less than 22 years old. Facebook doesn’t want any old folks creeping around, ruining the vibe.

In theory, all of this seems plausible enough. Facebook certainly has the drive, advertising network and application program interfaces (APIs) to compete with Snapchat. Overall sales are going gangbusters by every measure. Normally that would be sufficient.

What Facebook lacks, at least among teens, is street cred. Its efforts to target younger people have been contrived and often condescending. Promoting a 19-year-old to product manager and launching a mobile app that seems more Glee than Snapchat may not help. Today’s young people are smart. If Facebook wants to win their support, it needs to build smarter products and services specifically for teens.

Even with its teen failures, Facebook is a great growth story early in its ascent. I’m still looking for a pullback to add shares to help you participate.

QUICK TAKES

Apple (AAPL) is still playing hardball with TV executives and still getting almost nothing it needs to launch a compelling service on Apple TV. Execs are not willing to let Apple dominate TV the way it dominated the recording industry with iTunes… Facebook (FB) is now testing video ads that play during live video feeds. It may be just old school logic, but that seems a lot like commercials…. Google just added a feature to its popular Maps application that allows users to automatically generate nearby areas of interest. You can begin to see how Maps will be monetized, perhaps aggressively and usefully so. It’s Search for the real world and potentially as big… Microsoft (MSFT) just can’t stop adding stuff to Word. The latest are a researcher and an editor driven by machine learning… A skydiver jumped out of an airplane from 25,000 feet without a parachute and landed in a giant net on the ground and survived unhurt. You just know this is going to start a trend that will not end well… A new artificially intelligent robot can think, move and even sing independent of humans. Thankfully, it doesn’t have legs — yet. … If you need further evidence that automobile, technology and mobility companies are converging, check this crazy diagram of partnerships and investment. …Russia’s national intelligence agency says its hackers are now able to collect encryption keys allowing access to any message sent, received or delivered on the Internet. … IBM (IBM) is developing a new chip that can find signs of cancer in the blood with amazing accuracy. These labs on a chip will cut costs from the diagnosis process.

Best wishes,

Jon Markman

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