The kids nowadays prefer that Instagram over the Facebook and Twitters, according to a new survey of 7,500 teens by Piper Jaffray. In its spring 2014 teen survey the consultancy found that 30% of teens ranked Instagram their most important social network, ahead of Twitter at 27% and Facebook at 23%.
These are all big changes from the results of a previous Piper Jaffray survey a year ago, when 33% of teen respondents chose Facebook as their most important social network, compared to 30% for Twitter and just 17% for Instagram. Other social nets trailed far behind: Google+ got just 4% in the recent survey, down from 5% a year ago; Tumblr was at 5%, up slightly from 4% previously; and Pinterest was flat at 2%.
While the trend line isn’t great for Facebook per se, it makes Facebook’s $1 billion acquisition of Instagram look even smarter. Indeed, Piper Jaffray analyst Gene Munster said the company was maintaining a cautiously favorable rating on Facebook’s stock: “Our core takeaway is that Facebook has shown through its Instagram purchase that it is cognizant of changing trends in social and not afraid to make aggressive moves to capitalize on changes.”
However, he also pointed to the obvious challenges in the long run: “While we remain confident that Facebook is well situated for at least the next year, longer term we believe the survey data highlights the reality that interest in social platforms is fleeting and there will always be a new platform to compete for time spent on social.” With that in mind, “We believe the 10+ year sustainability of Facebook as a business may hinge more on the company's ability to make smart acquisitions than execute on its core business.”
That last comment, in particular, may serve to temper investor optimism, as it suggests further growth will require further expenditures by Facebook, as organic growth tapers off.