There was a time when Facebook was the social media tool favoured by individuals and businesses alike. However, 2012 has been a rocky time for the social media marketing website, with a trouble IPO earlier this year appearing to be only the tip of the iceberg, which could prove to be the sites fall from grace.

Below, we look at five other reasons why Facebook is slowly (but surely) beginning to lose its grip as the number one social networking site, as it falls out of favour with brands, businesses and individuals.

Facebook Stopped from Cashing in on Olympics:

With just over a month to go the majority of the UK is getting excited about the Olympic Games; with businesses paying millions of pounds to carry the official logo on their products.

However, due to the strict marketing restrictions around the Olympic Games, Facebook have been prevented from cashing in the games; having been forced to drop all advertising around the official Olympic Facebook page.

The announcement that Facebook would not be having any advertising around the official Olympic pages came at the launch of the official Olympic Facebook page, when head of international business development at Facebook, Christian Hernandez, said: “We will not be running adverts against these Olympic pages.”

Hernandez added that just like the stadium itself will be a ‘clean venue’ with no adverts visible inside the stadium, all of Facebook’s Olympic pages, which feature both the official Olympic Games and London 2012 logos, will carry no adverts.

In further bad news for Facebook, where once they would have been the only social network site to have an official Olympic page; Twitter and Google+ are expected to launch theirs shortly; and Foursquare have already launched theirs.

Instagram Bid Investigated:

Those who keep an eye out on new, up-and-coming social networking sites will no doubt have heard of the photo sharing site, Instagram.

The site became one of the fastest-growing social networks ever, after launching in October 2010 it amassed thirty-million users solely through its iPhone app in less than eighteen-months. The popularity of the site caught Facebook’s attention, who promptly launched a $1 billion bid for it in April.

However, less than two months later and the UK competition regulator, the Office of Fair Trading, announced that it was investigating the bid over concerns that Facebook may look to take the monopoly in the market by preventing picture uploads to other sites from the app, or restrict other apps’ ability to upload to it.

Facebook Upsets Users Over Email Addresses:

Earlier this week (June 26th 2012), it was widely reported that Facebook was facing a backlash from users, after the social network site replaced email addresses linked in members’ contacts, with those provided by its system – without asking for users’ permission first.

Facebook originally announced the move back in April, saying: “We are providing every Facebook user with his or her own Facebook email address because we find that many users find it useful to connect with each other, but using Facebook email is completely up to you” – although the announcement received little attention at the time, it now seems to have upset some of the sites users.

It is believed that should the Facebook email system take off, it could drive more traffic to the firm’s pages helping boost advertising sales. However, Google previously tried something similar, with their now defunct social network, Buzz.

App Rolled Out and Immediately Rolled Back In:

As Facebook continues its expansion, they recently rolled out a feature called “Find Friends Nearby.”

However, no sooner had the feature been rolled out than it was pulled again; with a spokesperson for Facebook saying: “This wasn’t a formal release. This was just something that a few engineers were testing. With all tests, some get released as full products, others don’t. Nothing more to say on this for now, but we’ll communicate to everyone when there is something to say.”

Although this may be a valid excuse, there are some who believe that amid current controversies surrounding the social network, such as those listed above, Facebook have pulled the feature over privacy concerns, as it has the ability to locate nearby users regardless of whether they’re “friends.”

To Opt in or Opt Out of Ads:

Many businesses the world over who use Facebook do so for two reasons; the first being to help interact and engage with their target audience via images, videos and status updates; the second being to advertise.

However, this may potentially change, after Facebook was forced to allow users to opt of their details being used within “sponsored stories.”

Sponsored Stories allow companies to use the photographs and names of people who have liked their brand, in their adverts across the network; making the adverts more audience friendly.

However, five users who were unhappy that their images have been used across the site have come to a £6 million settlement, after a legal case was started last year.

Under the settlement, Facebook have announced that it will allow users the option to opt out of their profiles being used within adverts, for at least the next two years, with the settlement agreement ruling: “Facebook will create an easily accessible mechanism that enables users to view the subset of their interactions and other content that have been displayed in Sponsored Stories.

“Facebook will further engineer settings to enable users, upon viewing the interactions and other content that have been used in Sponsored Stories, to control which of these interactions and other content are edible to appear in additional Sponsored Stories.”

Could this move, along with the other issues highlighted above, hinder Facebook further if users begin to utilise other platforms for social networking and businesses also opt for using other platforms for social media marketing?

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