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How Facebook Marketplace is keeping young people on the platform
METAMeta Platforms(META) CNBC·2025-03-08 14:00

Core Insights - Meta's Facebook remains influential globally, but usage among younger users is declining, with only 32% of U.S. teens using the platform in 2024, down from 71% in 2014 [1] - Facebook Marketplace, launched in 2016, has become a significant success for Meta, boasting 1.1 billion users across 70 countries and competing with platforms like eBay and Craigslist [1] Group 1: Marketplace Features and Advantages - Marketplace is described as "the flea market of the internet," facilitating a large volume of consumer-to-consumer transactions without listing fees, which is a key attraction for sellers [2] - The platform's local pickup option helps users avoid shipping costs, enhancing its appeal [2] - The resale market is booming, projected to reach 350billionby2027,positioningMarketplacefavorablywithinthistrend[2]Group2:UserTrustandEngagement−YoungerbuyersareattractedtoMarketplaceduetoitsaffordabilityandsustainability,withtrustbeingasignificantfactorasusers′Facebookprofilesprovideasenseofsecuritycomparedtoanonymousplatforms[3]−MarketplaceisnotamajordirectrevenuesourceforMetabutplaysacrucialroleinuserengagement,whichisvaluableforadvertisers[5]−DespitebeingoneoftheleastmonetizedpartsofFacebook,Marketplacehelpsdemonstratethatyoungerusersstilllogin,eveniftheiractivityisfocusedonbuyingandsellingratherthantraditionalsocialengagement[5]Group3:StrategicPartnershipsandRevenueProjections−InJanuary2025,eBaypartneredwithFacebookMarketplace,allowingselecteBaylistingstoappearontheplatform,whichisexpectedtogenerateanadditional350 billion by 2027, positioning Marketplace favorably within this trend [2] Group 2: User Trust and Engagement - Younger buyers are attracted to Marketplace due to its affordability and sustainability, with trust being a significant factor as users' Facebook profiles provide a sense of security compared to anonymous platforms [3] - Marketplace is not a major direct revenue source for Meta but plays a crucial role in user engagement, which is valuable for advertisers [5] - Despite being one of the least monetized parts of Facebook, Marketplace helps demonstrate that younger users still log in, even if their activity is focused on buying and selling rather than traditional social engagement [5] Group 3: Strategic Partnerships and Revenue Projections - In January 2025, eBay partnered with Facebook Marketplace, allowing select eBay listings to appear on the platform, which is expected to generate an additional 1.6 billion in sales for eBay by the end of 2025 [4] - This partnership is anticipated to increase the number of buyers and sellers on Marketplace and potentially address some trust issues [4] - Facebook takes a 10% cut of sales made through its shipping service, although it does not charge listing fees [4]