On Wednesday 11th September, Facebook shares hit an all-time high, breaking through the $45 barrier and pushing the company to a $106billion valuation. This presented an entirely different picture to their sub $20 trading not too long ago.
Just one year ago, people were predicting something of a second dotcom bubble burst. Investors, still stemming the blood from multiple financial wounds over the last five years, scrambled to get away. So, why the turnaround?
According to Reuters, something of an esteemed source, the comeback is primarily down to "investors (who are) focused on its recent mobile advertising advances and the potential to expand ad revenue into new areas."
Mobile. It's a magic word for investors and brands alike. Facebook alone saw a 75 percent increase in revenue from this source in the second quarter. It is, to be frank, where everything is going.
I know I am probably preaching to the choir, but there needs to be some kind of understanding as to why this channel is so effective in order to use it the right way. The simplest reason mobile is saving digital is the fact that it is with us, everywhere, all the time. I mean, who even turns off their smartphone before going to bed anymore? Anyone?
What if you miss that emergency call? The thought is too awful to contemplate. So you leave it on. We all do.
Mobile presents the first time advertisers can speak to all people all the time... ever. the ramifications of that are truly enormous.
Unlike TV which has fractured into hundreds of weird little pockets of content each attracting isolated clumps of eyeballs, mobile still has a somewhat consolidated audience spread rather thickly across major sites/apps. These sites are the social leviathans such as Facebook, Twitter, LinkedIn. They are being joined by other, content sharing applications such as Instagram (Facebook were smart with that one), Snapchat, and more. Even Yahoo's new acquisition, Tumblr, courts more mobile than desktop users.
However, I would argue that the upturn of social media's fortunes in mobile are not just down to their own grasp of the medium. I would place it almost squarely at the feet of the advertising agencies. They (we) are finally producing content that has some kind of value not just to the brands, but to users. This kind of success translates into positive numbers, which in turn convinces these brands to part with their media cash and leads to increased revenue for the social networks. And I wondered why Facebook was so nice to us!
It is, in my mind, for just this reason that the likes of Twitter and Foursquare are now looking into IPOs or sales; the time is ripe to cash in on media which has finally found its true purpose and strength in the mobile arena. Smartphone sales may be slowing, but their daily usage is doing nothing but climbing to the heavens. Investors must be chomping at the bit to get a piece of that action, especially with the more concrete results being reported by the pioneer of social that is Facebook.
So what if mobile goes the way of TV? What if so many apps and networks fragment user figures so that the return on investment is threatened as it has become in TV? In all likelihood, that will not happen anytime soon.
The beauty of digital, as opposed to TV, is that one does not need to select one channel over another; we have a presence across multiple channels, all of which we engage with in order to spend time with friends. It is that most human of traits -- friendship -- that will ensure our continued commitment to the phenomena of social networks.
Yes, there will be newer greater apps. There may even be better social networks on the horizon, but the mobile audience will never be fragmented as, no matter where they go, they will always want to be together at some point.
That, after all, is the whole point of mobile: to stay in touch at all times.