Facebook users don’t trust the company with their private data, rarely click on display advertisements, and split on the social giant’s investment status prior to the impending IPO, according to a new poll conducted by CNBC and the AP.
Shockingly, the poll data only confirms what we already know — Facebook users are wary of Facebook.
According to the poll results, 59 percent of people distrust Facebook on user data, 57 percent of users said they never click on display ads, and 26 percent said they only rarely click ads. For a company that derives over 80 percent of its revenue through ads that are powered (in part) by that private user data, this could be an issue for Facebook. The company has also done a poor job of monetizing ads via mobile devices, which is increasingly how users are accessing the site.
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Facebook has plans to grow its Facebook Credits business as well as making the site a platform for financial transactions, which poll respondents were also wary of. The poll indicated that 54 percent of users don’t trust the site enough for these types of purposes. Honestly, I think this is an area where Facebook will grow despite the current emotions of people who still associate the site with trivial things like social gaming and keeping up with people you knew in the first grade. Once upon a time, the majority of people were also just as wary about using their credit card to buy things from online retail stores. And as Amazon, eBay, and others have proven, this is no longer the case.
As for Facebook’s overall valuation, the poll respondents are divided on both the company’s $100 billion valuation as well as if it’s a good investment, with people under 35 taking a more favorable stance. But not everyone is convinced Facebook’s stock will hit a home run.
“My opinion is that the IPO is taking place too late for future investors to see any benefit, so I’m basically watching it as if it’s a cash-out event for early-round investors,” writes investment blogger Lucas Krupinski. Basically, that means the stock will do great if you bought it prior to going public, but after IPO day everyone will likely dump it. However, that doesn’t say much for its long-term value.
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