“Twitter has changed the world.” This is the narrative being told by Twitter’s biggest fans as well as those charged with rolling out their IPO. Twitter’s rise to the top has been impressive and I, like many others, believe they have indeed changed the world and have the capacity to continue to do so. Yet as a future investor as well as an avid user of Twitter and their advertising products, I believe that in order to continue to grow and improve their revenue, Twitter must make the following five improvements within six months of their IPO:
1) Launch an improved ad product
I’ve worked on Twitter’s ad product with some of Silicon Valley’s most successful companies and here’s the deal: Twitter’s ad product is currently not built for scale. It’s also not very intuitive, even though it’s undergone several updates over the last year. It needs to be rebuilt for scalability and ease of use. Currently, creating complex ad campaigns on Twitter takes far too much time and this creates frustration while hindering Twitter’s growth. Furthermore, Twitter must design an improved ad product with small businesses and entry-level marketers in mind. As it currently stands, advertisers must work with a Twitter account manager, spend at least $5K/month on ads, and agree to a minimum of three months of advertising—before they can even launch an ad. This current reality only further stresses the need for Twitter to drastically improve the accessibility and functionality of their ad product.
2) Develop new and unique metrics for advertisers
Once you’ve begun running ads with Twitter, their account managers focus heavily on the rate of engagement as their main metric. This rate of engagement includes clicks, retweets, favorites, replies, and follows. As an online marketer, I learned that a “good” rate of engagement benchmark for Twitter account managers was .02%. First of all, 2% of anything isn’t impressive. Secondly, Twitter should define more proprietary metrics and ‘scores’ to show the advertiser how impactful their ads are. Facebook created such metrics like People Talking About This and Unique Reach. Lastly, Twitter’s key metrics improvements should focus on the offline connection (for example, a user clicks on a Twitter ad then buys that advertised product at a later date) as well as the consumer’s intent to purchase.
3) Improve monetization of dual-screen engagement
Twitter’s current software scans U.S. television listings and pushes advertisers’ tweets when a similar ad runs on TV. Now, this works well for brands spending the $50,000 minimum on coordinated Tweets, but it’s a non-starter for small and medium-sized businesses. Twitter knows one of their largest value propositions is dual-screen engagement: a user watching television while using his/her mobile device. So therein lies a fantastic growth opportunity for Twitter: connect small and medium-sized businesses and marketers with the information they need about television listings to create creative, inventive, unique ads. For example, a larger, more well-known competitor creates a TV ad and it’s lack luster. Twitter could empower the smaller, lesser-known competitor to launch a Twitter ad campaign which pokes fun at the bigger guy’s ad.
4) Clearly explain their value proposition to a larger audience
Facebook has 1.19 billion active monthly users; Twitter has 215 million. Additionally, Facebook is more interactive than Twitter. The Facebook Newsfeed delivers a media-rich experience that Twitter is attempting to match, but is still a bit behind on. Twitter also “feels different” for people in regards to sharing information with their personal or professional networks and if you ask them, they aren’t sure why. A common question among friends or colleagues remains “why did you share that on Facebook but not on Twitter?” This confusion and “different feeling” proves Twitter has yet to fully explain their unique value proposition to users and future users—in other words, why is Twitter critically important to your life. I believe that Twitter is a very important tool and has huge potential value to young and old around the globe—regardless of someone’s socioeconomic status. To address these needs right away, Twitter needs to redevelop the sign-up process for new users (it’s too bogged down and cumbersome) and at the same time, clearly explain their value proposition to a larger, more diverse audience.
5) Continue to develop strong media partnerships
Over the last year, Twitter has announced several key media partnerships which has in turn, improved Twitter as a household name, added to their legitimacy during their IPO plans, and connected the company with more mainstream media outlets. All in all, it’s a win-win strategy for Twitter to continue. So why not make strong media partnerships a cornerstone of their continued growth strategy? Why can’t every single major news channel have a segment where they discuss what’s big on Twitter that day and use the current Twitter dialogue as a national temperature gauge? Some of this is already taking place on cable news channels, but it could be greatly expanded and deepened.
In summary, Twitter has come a long way since its inception, but it still has a long way to go in order to become an advertising powerhouse and a revenue-generating rock of the tech industry. The next few months are critical to Twitter’s sustained growth and the steps they take to improve their product will either impress or disappoint investors and future investors.
(Photo from Reuters/Eric Thayer)
Update 10:00AM MST: A Twitter representative contacted me and clarified that now “many businesses are not required to make the 5k/month commitment. We do have a SMB channel with no minimum, pay by credit card.” He also said “The rest of the points are right on-target and we will look to improve.”