Facebook Users Distrust Company, Apathetic Toward Ads [REPORT]

A
A recent poll from AP-CNBC revealed that most Facebook users do not trust the social network to keep their information private. In addition, the study revealed that a large majority of respondents do not click on sponsored ads or advertisements. (Photo: REUTERS/Eduardo Munoz)

With its initial public offering just days away, Facebook is facing criticism from all angles, and now that criticism is coming from some of the most valuable people to the company -- its users.

A new AP-CNBC poll of U.S. Facebook users has revealed a significant amount of distrust toward the company, and, in addition, the poll revealed that a large majority of people are rarely interacting with the ads that appear throughout the site. The two conclusions drawn from the poll could have a significant impact on Facebook's IPO performance, especially because Facebook relies on user data and advertisements to leverage revenue.

The study revealed that 57 percent of Facebook users polled never click on advertisements or any other sponsored content on the site. Another 26 percent of those polled said they hardly ever engage in such activity. A mere 4 percent of users said they click on ads, which is barely better than the 2 to 3 percent benchmark for click-through rates that experts consider to be necessary for effective banner ads.

In addition to the overwhelming indifference to advertisements displayed on the site, the study revealed that 59 percent of respondents had little to no trust in Facebook to keep their information private. Privacy has long been the concern for Facebook users, and it has even landed the company in a lawsuit with the Federal Trade Commission.

Still, despite the growing concerns of an uncontrollable, persistent, free-flowing exchange of information, the Facebook user base continues to grow. Facebook currently has 901 million monthly active users and approximately 80 percent of their monthly active users are outside of the U.S. and Canada. Advertising revenue, too, has continued to grow tremendously over the last several years. It seems as though all of the most crucial metrics of success appear to be on the upswing.

The truest test of trust for Facebook will be on Friday, when the company makes its IPO. The company is expected to price its stock between $34 and $38 per share at a target valuation of up to $104 billion.

The AP-CNBC poll was conducted between May 3 and May 7. The sample size was 1,004 people, all of whom were ages 18 and over. The margin of error for the poll was +/- 3.9 percentage points. 

Join the Discussion