To Understand Facebook, Quit Facebook


The following video is part of our "Motley Fool Conversations" series, in which research analyst Catherine Baab-Muguira and industrials editor/analyst Isaac Pino discuss topics across the investing world.

A new Reuters poll reveals that four out of five Facebook users say the site has no influence on their purchasing decisions -- a disturbing fact, given that Facebook's current business model is almost entirely dependent on advertising. As if that weren't bad enough, the same poll shows a third of users reporting that they spend less time on the site than they did just six months ago, which doesn't bode well for Facebook's attempts to monetize its user base in some other, yet-to-be-devised way. Analyst Cat Baab-Muguira relates her own experience in quitting Facebook, seconding the findings of the Reuters survey. Is Facebook's appeal (and potential) draining away?

Facebook recently became the largest company ever to IPO. Yet all the buzz around this social media monster could prove off-base, as Facebook has deep problems converting its millions of members to revenue. We've created a new report, "Forget Facebook -- Here's the Tech IPO You Should Be Buying," that details a much better social media stock that has a longer runway for growth than Facebook. The report won't be available forever, so click here to get access today -- it's totally free.

At the time thisarticle was published Catherine Baab-Muguira has no positions in the stocks mentioned above.Isaac Pinohas no positions in the stocks mentioned above. The Motley Fool owns shares of, Facebook, and Google.Motley Fool newsletter services, Google, and Yahoo!. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.

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