Nearly two-thirds of the world’s population is plugged into the matrix, with over 4.4 billion internet users across multiple device types. We use these devices for work and for play—and social media has altered the way we interact both online and offline. Today’s infographic from Global Web Index compares key generational and regional differences of social media use based on data from nearly 114,000 internet users, highlighting how pervasive social media has become in our lives. Note: China is excluded from the usage data regarding specific social networks and apps.
From Age to Age: Social Media by Generation
How does the use of social media vary by generation?
Baby Boomers
Boomers currently rank last in nearly every category and metric when it comes to technology and social media use. This generation didn’t grow up inundated with technology in the way today’s youth are. However, Boomers are showing the greatest increase in activity on social media platforms. For example, usage of Instagram and WhatsApp is up 59% and 44% respectively for this group since 2016, which is more than double the global average.
Generation X
Also known as the ‘MTV Generation’, the Gen X group was the last generation to grow up before the Internet truly took off. The early years of this group were marked by a burst of new technologies, from wireless phones to personal computers. On average, Gen Xers spend nearly two hours on social media per day—less than Millennials and Gen Z, but more than Boomers.
Millennials
Perhaps surprisingly, Millennials show a slow down in the time spent on social media. From 2017-2018, screen time for Millennials on social media decreased by one minute, to 2 hours 38 minutes per day. This trend points to Millennials seeking real-life experiences and better engagement from the brands they interact with online, rather than passive scrolling. Other factors also play a role in this evolution─nearly 50% of Millennials admit that their activity on social media has caused them to overspend to impress their networks.
Generation Z
Gen Z is the first group in history that has never known a world without the Internet. Immersed in the online world since birth, Gen Z surpasses Millennials in daily activity on social media with 2 hours 55 minutes spent per day. North American, Latin American, and European Generation Z-ers lead in the number of social accounts they’re actively using. Many are also moving away from platforms like Facebook in favor of multimedia-heavy sites such as YouTube and Instagram.
Social Media by the Numbers
Social media sites measure the number of unique users on the platform each month as a metric of success. Below is a snapshot of the five major social media sites shown in today’s graphic and their active user count. Monthly Active Users (MAU) as of July 2019
Facebook: 2.4 billion YouTube: 2 billion WhatsApp: 1.6 billion Instagram: 1 billion Twitter: 330 million
Even more striking is what happens in a social media minute:
41.6 million messages sent over Facebook Messenger and WhatsApp 347,222 people are scrolling Instagram 87,500 people posting to Twitter 4.5 million videos on YouTube being watched
Social Media’s Role in Retail
Social media has evolved from simply keeping us connected to our friends. Users can now access career tools, engage with their favorite companies, stay current with global events, and find love. Across all regions and generations, social media has propelled e-commerce into the limelight. More than ever before, social media sites are being used for product research, brand engagement, and online purchases. For example, Instagram now offers one-click shop features that allow users to buy what they see immediately, with a simple tap on their screens. The greatest growth in e-commerce, however, has been the influencer industry. These star-studded internet personalities boast massive online followings from a wide range of demographics—and companies are taking notice. In 2018, 72% of major brands stated that they were outsourcing a significant portion of their marketing resources to online influencers. Followers feel as though they’re getting a product recommendation from a friend, making them more likely to buy quickly.
Social Media Growth
Despite the rate of social media growth slowing down, social media use is still growing. From 2017 to 2018, the average person increased usage by three minutes per day, while becoming a new user of 0.8 social media accounts. Social media is a broad, multi-faceted, and complex industry that appeals to a wide range of cultures, age groups, and personalities. While growth in social media activity may be slowing down, a growing global population may mean we’ll see more opportunities to stay connected. on But fast forward to the end of last week, and SVB was shuttered by regulators after a panic-induced bank run. So, how exactly did this happen? We dig in below.
Road to a Bank Run
SVB and its customers generally thrived during the low interest rate era, but as rates rose, SVB found itself more exposed to risk than a typical bank. Even so, at the end of 2022, the bank’s balance sheet showed no cause for alarm.
As well, the bank was viewed positively in a number of places. Most Wall Street analyst ratings were overwhelmingly positive on the bank’s stock, and Forbes had just added the bank to its Financial All-Stars list. Outward signs of trouble emerged on Wednesday, March 8th, when SVB surprised investors with news that the bank needed to raise more than $2 billion to shore up its balance sheet. The reaction from prominent venture capitalists was not positive, with Coatue Management, Union Square Ventures, and Peter Thiel’s Founders Fund moving to limit exposure to the 40-year-old bank. The influence of these firms is believed to have added fuel to the fire, and a bank run ensued. Also influencing decision making was the fact that SVB had the highest percentage of uninsured domestic deposits of all big banks. These totaled nearly $152 billion, or about 97% of all deposits. By the end of the day, customers had tried to withdraw $42 billion in deposits.
What Triggered the SVB Collapse?
While the collapse of SVB took place over the course of 44 hours, its roots trace back to the early pandemic years. In 2021, U.S. venture capital-backed companies raised a record $330 billion—double the amount seen in 2020. At the time, interest rates were at rock-bottom levels to help buoy the economy. Matt Levine sums up the situation well: “When interest rates are low everywhere, a dollar in 20 years is about as good as a dollar today, so a startup whose business model is “we will lose money for a decade building artificial intelligence, and then rake in lots of money in the far future” sounds pretty good. When interest rates are higher, a dollar today is better than a dollar tomorrow, so investors want cash flows. When interest rates were low for a long time, and suddenly become high, all the money that was rushing to your customers is suddenly cut off.” Source: Pitchbook Why is this important? During this time, SVB received billions of dollars from these venture-backed clients. In one year alone, their deposits increased 100%. They took these funds and invested them in longer-term bonds. As a result, this created a dangerous trap as the company expected rates would remain low. During this time, SVB invested in bonds at the top of the market. As interest rates rose higher and bond prices declined, SVB started taking major losses on their long-term bond holdings.
Losses Fueling a Liquidity Crunch
When SVB reported its fourth quarter results in early 2023, Moody’s Investor Service, a credit rating agency took notice. In early March, it said that SVB was at high risk for a downgrade due to its significant unrealized losses. In response, SVB looked to sell $2 billion of its investments at a loss to help boost liquidity for its struggling balance sheet. Soon, more hedge funds and venture investors realized SVB could be on thin ice. Depositors withdrew funds in droves, spurring a liquidity squeeze and prompting California regulators and the FDIC to step in and shut down the bank.
What Happens Now?
While much of SVB’s activity was focused on the tech sector, the bank’s shocking collapse has rattled a financial sector that is already on edge.
The four biggest U.S. banks lost a combined $52 billion the day before the SVB collapse. On Friday, other banking stocks saw double-digit drops, including Signature Bank (-23%), First Republic (-15%), and Silvergate Capital (-11%).
Source: Morningstar Direct. *Represents March 9 data, trading halted on March 10.
When the dust settles, it’s hard to predict the ripple effects that will emerge from this dramatic event. For investors, the Secretary of the Treasury Janet Yellen announced confidence in the banking system remaining resilient, noting that regulators have the proper tools in response to the issue.
But others have seen trouble brewing as far back as 2020 (or earlier) when commercial banking assets were skyrocketing and banks were buying bonds when rates were low.
