Facebook data scandal: New entrepreneurs remain loyal to social media platform

While the Fast-Moving Consumer Goods (FMCG) giants are unhappy with Facebook after the data breach scandal, small-timers and new entrepreneurs still swear by the social media platform. Data security may be a concern, but most of them do not want to lose out on the consumer reach that Facebook offers.

“It is disturbing to know that our data is not safe but for entrepreneurs like me, Facebook is the only way to reach out to a huge crowd. That is where we get our maximum clientele (close to 90 percent) and we cannot abandon the medium till there is an alternative to promote our brands,” said Kolkata-based designer Durba Nag.

Nag’s brand ‘Notlikeyou’ sells handmade apparel only through Facebook and has allocations for paid advertising to shore up more traction.

Alongside the larger players, entrepreneurs like Nag contribute to the revenue social media generates through advertising spends in India.

A recent report by the Federation of Indian Chambers of Commerce & Industry (FICCI) said digital ad spend contributed 17 percent of total ad expenditure in India in 2017. It has grown from 15 per cent in 2016. Not so surprisingly, by 2020, it is expected that approximately 22 percent of total ad spending will be on digital.

The report also says that India has already become the second-largest market for social networking giants such as Facebook (with over 250 million users) and LinkedIn (with over 42 million users) and is expected to surpass the US to lead the global tally of the largest Facebook user base on mobile devices in the next couple of years. In addition, photo-based platforms such as Instagram has 30 million users while Snapchat has achieved 10% penetration.

Research by Omidyar Network suggests that Indians spend 200 minutes a day on mobile apps, 40% of which is spent on social media apps. Small entrepreneurs do not want to miss out on that kind of attention, especially since it comes for free.

Brands like Happily Unmarried started out their venture via Facebook and owe their success to the medium. “It is a business relation that we share with Facebook and the relation goes on even after having physical stores and our own site because we see customer engagement happening on Facebook. There has been no fall in numbers we get from there. Once that happens and we feel it is for the data breach, we will then look out for other options to fall back on,” said Rajat Tuli, co-founder at Happily Unmarried.

However, it is not just brands. Bloggers, new cooks, stand-up comedians, singers or whoever uses the medium as a stepping stone have pledged their loyalties to Facebook. Most of them swear by the exposure and views the medium offers and data breach is not on their list of concerns, at the moment at least.

"Facebook is a good medium to reach out to people and data breach had to happen one day or the other. This is not unpredictable. This is just a loophole that if addressed will put everything back in place and we believe Facebook will take care of the issue," said Deep Zanzarakiya, founder at The Kickboxing Studio in Ahmedabad. He advertises his brand through live videos and posts on Facebook.