Jack Dorsey must not abandon Twitter Commerce for Display Advertising Model

Jack Dorsey’s recent submission about the Twitter platform ( “Twitter is live: live commentary, live connections, live conversations.” ) has created/reinstated an enthusiasm among various stakeholders for another revival for the company, from 30% below the IPO listing price with over $500m loses, high employee turnaround and, more importantly, low user growth.

Once the closest rival to Facebook, Twitter has reduced to a 10th of Mark Zuckerberg’s empire and there are many hypotheses around, from the famous open blog from to Chris Sacca to Dick Costolo’s claim for shareholder pressure for a quick and high-profit margin, to a disengaged developer community, as to why Twitter is struggling to take off, both monetarily and on the popularity front.

No doubt since Jack Dorsey took over as CEO, company has shown some promising progress such as a redesigned home page for non-registered users, talks about increasing tweet length to 10K, Twitter Moments, support for GIF and videos, re-integrating the developer community to develop apps using Fabric and opening Direct Message for non-followers. However Jack failed to show any progress on the Twitter commerce side, which in my opinion might leave the company with a lot to catch up with on the social commerce or sharing economy side, which is growing at a far higher rate than any other commerce medium.

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How To Solve Marketing Problems for Startups using Social Media ?

Social Media Marketing

My top tip to promote your start up business with social media is to focus on one area of conversation topic and to be very selective about spending any money on advertising at all. I am very strict with my own time management to read new articles and stories from reliable and professional sources. You can comment on reputable online trade journals with links back to your website or blog but make sure you add value to the article and not just an aggressive sales pitch. Be prepared to give before your receive.

I started my business in 2008 with just £1 and a smartphone and a very niche service. I had to plan my blogs and tweets with precision.

The quality of my business connections was more important than quantity of connections. I am focused on how large retailers are using social media locally and I need to hangout online and offline in places where my clients would be.  I choose a blend of Retail trade press and individual blogs and tweets from a small group of practitioners, rather than over hyped general thought leadership with no substance or just a ‘rant’.  I am a loyal viewer of Bloomberg West too, broadcast in the UK at 23:00 on Bloomberg TV. This programme gives a good insight with interviews from the people running the future technology businesses in Retail.

I also am a great believer in tracking down original data to back up my thoughts for my own social media feeds, for example, we published an article for our Social Retail Blog recently which took my team 3 weeks to prepare behind the scenes. It was audit of over 20 large retailers and how they were developing their local social media strategy, or not as our results showed.

So when you’re starting a business and you have very little cash resource for paid advertising, I would recommend social media is the only option to help you connect with future clients and empower them to talk about you in their own words. This means you must focus your business on adding value to your clients’ whilst constantly keeping an eye on your competitors and changing with your environment.  There are no short cuts so invest your time wisely and be focused.

In a B2B context, try and get as many opportunities to speak at industry events and possible and tweet live from conferences so people can see that you’re  contributing towards communities.

Most importantly, don’t give up! Treat every client with a personal service and ensure that they are 100% satisfied with you. As the UK is coming out of ‘The Great Recession” there has never been a better time to start up a business and use social media to grow your connections at the speed of a tweet.

Twitter Focusing on Big Data & Social Commerce after Ads & Social TV

A recent Twitter annual report showing lower than expected growth of monthly active users, revenue, engagement and timeline views has sent some shock waves into the market, and as a result the share price is over 40% down since its high in November 2013. Also some high profile clients have raised questions on its effectiveness for driving traffic.

So far, if we look, Twitter is focusing more on display advertising products such as prompted tweets and accounts, in addition to TV amplifier, where Twitter is trying to leverage its usage along with TV programs. But we all know results are not promising and clients have shown some concern.

Despite all its criticism, Dick Costolo (Twitter CEO) is very positive about Twitter’s future growth and promised to launch a series of new products and services to boost its revenue and effectiveness for businesses. Let’s look at what these future products could be.

Gnip + BlueFin + MoPub Means Twitter can become Mobile Google AdWords

Last Year Twitter made 11% of their revenue via data licensing and one of the recent developments was that Twitter ended up buying one of their data licensing companies, Gnip. This will give Twitter a more control over how to use their data powerhouse with over one billion tweets every two days and loads of rich media content, link images, video and text.

We should not forget that last year Twitter acquired MIT based data analytics start-up Bluefin, which means they must be looking to combine Gnip data aggregation and Bluefin’s data analysis techniques to provide a more enriching experience to both businesses and consumers.

Twitter also owns mobile ad exchange company MoPub, which means Twitter can offer advertising beyond their platform: imagine, if Twitter analytics could identify the right trends (images, keywords, and videos) from billions of tweets and let businesses target people on a mobile platform at real-time; they could really become Google AdWords on mobile.

Twitter and Amazon partnership shows Twitter inching towards real-time commerce

Last week Amazon announced a partnership whereby users can link their Amazon and Twitter accounts and then add stuff, via tweets, to their basket. It’s a great first step toward the highly anticipated Twitter commerce where whole transactions (including payment) can be carried out on Twitter.

Twitter Amazon Comerce

If we look based on Twitter’s mobile usage and real time nature, there is a huge possibility for Twitter commerce, as businesses can setup a service where consumers can find and buy their products on Twitter. For example, Amex already allows customers to find the latest deals on Twitter in real-time. Our (i.e. Startup TweepForce) client Payasugym lets you find your nearest gym via a tweet and another client (@Socialretail) runs loyalty campaigns purely on Twitter to encourage users to be more engaged.

To sum up, these last two developments (big data and Twitter commerce) look very promising as they go beyond traditional display advertising and can give Twitter an extra edge on their competitors.

Why Facebook, Twitter and LinkedIn Have Failed to Commence Social Commerce?

Social commerce

Online commerce is on the rise; last year online sales went up by 20% worldwide and touched down at over $1.5 Trillion. Mobile commerce has also made inroads and accelerated commerce through internet-enabled portable device. The turnover of online retailers or marketplaces likes Amazon or EBay is far higher than many yesteryears retail giants and has forced multiple closures and mergers within retail industry.

Despite all this growth, online commerce is always poised for disruption i.e. businesses and start-ups are trying to find new ways to sell their products and services: pure electronic and/or mobile commerce sites/applications (e.g. Amazon); combination of ecommerce and marketplace (e.g. EBay); email subscription-based commerce sites (e.g. Groupon); and price comparison sites (e.g. Kayak.co.uk).

And now with the growing popularity of social networks like Facebook, Twitter, LinkedIn, Pinterest, and Instagram, there are many attempts within these networks, or by start-ups, to find ways to commence transactions in this medium. However, so far success is limited to marketing products and services via various forms of display and notification advertising techniques. Let’s look in to what exactly the issues are with social commerce:

1.People don’t mean what they say on social networks

Many studies suggest that social networks have lost their spontaneity and more become tool for brand and personal perception management. In other words people don’t really say what they mean; instead they broadcast things they believe will improve their perception in the public, which means social networks can’t really predict people’s interests, and therefore businesses are finding it hard to really target people based on their taste for any further transactions.

2.Dark social is far bigger than public social media

Despite the huge success of social networks like Facebook, Twitter and LinkedIn, people still largely use personal messages in the form of mobile text messages, email, WhatsApp, Skype and Snapchat to communicate with their friends, and mainly use public networks for general socialising, which means again businesses are clueless about consumers’ real intentions and fail to convert them to sales.

3.Semantic analysis is not smart enough

Social media is all about freedom of expression and people can express themselves in many ways e.g. write text, share sentiments, and upload videos and images. So far, semantic analysis has failed to understand the intent behind rich media. Therefore businesses are really unable to see their spending on display advertising converting into high sales.

4.Social networks are not designed to support the commerce journey

A typical commerce journey is finding, buying (payment) and delivery of products and services. However, because Social media is still evolving and is not designed to support transactions (LinkedIn has become the place to build a professional circle, Twitter is to catch up with current news and events, and Facebook is to hang out with friends and family), so users are not intending to use these networks for product discovery and delivery.

5.Social Media is too open for phishing

Due to the very open nature and perception of social media, privacy is always a big concern when it comes to divulging some sensitive information such as credit card and bank account details. Therefore consumers are very apprehensive of doing transactions on these platforms, which means businesses are not getting return for advertising investment on these networks.

Conclusion

As mentioned above, social media is still evolving and not designed for commerce. However, considering the amount of time we spend on these networks, which results in our giving out a lot information about our interests, intent and knowledge, even though very dispersed, social commerce is inevitable. As we speak, many efforts are in progress, from social media giants like Facebook and Twitter to start-ups like Tweepforce, to make genuine social transactions a reality.

And being involved myself with a social commerce start-up, I think the first thing these networks need to focus on is to start thinking of simulating the traditional commerce journey (product discovery, transactions and delivery) rather than inventing new ways for consumers to buy on their platforms. For example, when I want to buy a new watch, I should be able discover the best watch and then buy and receive delivery of it, on any given network. This is a humongous task and as I stated above there are many hurdles, but it’s not an impossibility. Let’s see who manages to break this code first.

Kabir , Frank Underwood, Mark Zuckerberg, WhatsApp – hey ho 2014

Facebook and WhatsUp

I have finally managed to get a moment or two to spend writing a blog post. Following birth of our first baby, the last few days were as hectic as I have ever known in my life, with no respite from changing nappies, reorganizing furniture and looking after both mom and baby, however, during all this madness, I also watched house of cards series two, which like season one is full of Frank Underwood’s antics around Shakespearean emotions to gain ultimate power and made me rank this soap along with Thick of it, and Yes Minister!!

Let’s rewind the topic to kid again, we have called our new-born “Kabir”, a name that caused some disagreement with my other half, family and friends. Kabir being an ancient Indian saint, some find the name too dated and others question whether such a name is controversial because it could symbolise a certain section of society or religion. But luckily, with some deep convincing and back channelling (Frank Underwood, #HouseofCards), I managed to persuade everyone that Kabir was the right name for this kid;

My reasons were very simple. 1) It has a nice, simple, easy ring to it, unusual but easy for everyone to pronounce. 2) The original Kabir (The saint from India) did rise above cast, gender and religion and showed society that humanity is the best thing going forward, which always inspired me and influenced me to name my son after him!

OK, that all was personal. It’s rare for me to post personal stuff but emotion is pouring out from me. Everyone says life takes different turn after a child and it may be that that is forcing me to show personal emotion on my tech blog!!Probably this is the first and last time I will talk about things other than tech and product development here!

Let’s get back to business. Looking back to when I last blogged, the main stub was that Mark Zuckerberg (Facebook) bought WhatsApp for $19bn. Looking at the stats, WhatsApp has 450m active users with over 1bn of messages exchanged every day. Facebook is valued at almost $42/user despite the fact that per user revenue is just under a buck – as a result many questioned if WhatsApp was really worth that much. At MWC14 Mark replied to that question with some hesitant affirmation i.e. he thinks it is but he might be wrong for the first time!

So what does this mean for Facebook and especially for Mark Zuckerberg?

He Continues to Lead from the Front
I think Zuckerberg continues to show his astute foresight and strong leadership skills when it comes to social media or new age communication tools, because first he managed to buy Instagram and then WhatsApp, despite both Google and Apple (far more cash riche than Facebook) being on the lookout for new generation tools!

Most Respected Among 21st Century Entrepreneurs
It also show that Zuckerberg enjoys high respect among start-ups or 1st generation entrepreneurs because, if rumours are to be believed, Larry Page from Google tried to offer a higher price to WhatsApp before Facebook bought it. The same is believed to be true for Instagram, which Zuckerberg managed to grab despite Jack Dorsey (Twitter co-founder) being on the Instagram board!

Facebook won’t be vanishing in 4/5 years’ time
Despite promising that WhatsApp will remain as independent as Instagram after buyout, Zuckerberg has managed to expand the Facebook product inventory, especially when some reports suggest that Facebook has already reached maturity and a downhill path might now be inevitable.

But what does this mean for the product development industry?

The Cross-platform Subscription Model has Legs!
WhatsApp is a cross-platform subscription-based messaging service which is not a new phenomenon. Similar services existed from the inception of dot com in the shape of Yahoo, Hotmail and AOL chat and then BBM brought that in on the mobile platform, but WhatsApp made the money. i.e. a lesson can be learned that a product which is better than anyone else’s and accessible from any device can leverage its success!

2014 belongs to Social Commerce, Bitcoin, Wearable Tech and Sentiment Search

2013 saw the rise and rise of mobile commerce, the stock market launch (and surge in share price) of social media sites such as Twitter, LinkedIn & Facebook, the introduction of wearable technologies like Google Glass, and high demand for Bitcoin took its valuation to $1,000.

Google shares reached over $1,000, LinkedIn shares are trading at over 300% of their original value, Twitter and Facebook shares are strong too. Overall, the year was very exciting and reached heights that caused  critics to suspect a tech crunch just around the corner.

On  the downside, 2012 stars like Zynga and Groupon have struggled to maintain their share price and profits, and Samsung and Apple went to war over various patents.

Amid all these highs and lows, I have spotted some trends that might dominate the coming year’s technology developments.

1.Facebook, Twitter and LinkedIn might need to think beyond display advertising or parish

Social media networks have become the most popular and most time-consuming sites and applications for users and the big three ($FB, $TWTR and $LINKD) are already trading on Wall Street with a combined valuation of over $200bn and a valuation per user over $100,  but revenue per user still in single figures. Therefore, I think to justify their valuation and competitive advantage, these networks will be forced to find means for brands to do commerce solely on their platform, because revenue merely based on display advertising and industry specific marketing products is not good enough and might only take them to closure rather than leading them to flourish.

2.Google, Samsung and Apple will indulge in a big wearable technology domination war

The Consumer Electronics Show (CES) 2014 in Las Vegas is full of companies (including LG, Intel, Sony, and Samsung) demonstrating wearable technologies, such as: smart watches, smart bands, smart ear buds, and smart glasses.

Apple and Google are not participating in CES 2014 but undoubtedly they must be keeping track of their competitors with an eye on the almost saturated smartphone and tablet market.
Apple has already filed a patent for iWatch and, due to shareholder pressure, might launch this in 2014. If we believe in the continuation of historical trends around competitors product launches following Apple’s new product release, I am sure Google glasses will come out of beta and Samsung will improve their already launched Galaxy Gear in order to be top of their industry; a wearable technology war seems inevitable.

3.Sentiments and Location Search will replace Google Keyword Search

For many, Google keyword search is still the primary form of data finding service. However, the rising popularity of Q&A engines like Quora, Facebook’s Social Graph, Apple’s Siri, Google’s Map, and recently launched Social search app Jelly, by Twitter founder Biz Stone, indicate the futuristic search trend is more aligned to human sentiments, where users can search stuff based on real intention rather than generic search terms.

4.APIs accelerate Marketing Automation but surge bot rates too

“A study by Incapsula suggests 61.5% of all website traffic is now generated by bots. The security firm said that was a 21% rise on last year’s figure of 51%; however, Activity by ‘good bots,’ it added, had grown by 55% over the year.”

The trend will continue because marketing automation with artificial intelligence is gathering momentum and content networks and providers are giving access to their data via open APIs.

5.The direct messaging industry is poised for disruption or consolidation

Snapchat, WhatsApp, Blackberry Messenger (BBM), Twitter Direct Message, and Facebook Messenger process over ten billion direct messages every day. However, none of these has managed to determine their monetisation model, which means consolidation is inevitable. Biggies like Facebook and Twitter in particular are trying to spread their wing in this sector.

6.Bitcoin or virtual currency will become mainstream

Recent developments in the virtual currency industry are:

1) Bitcoin is trading at $1,000 after Zynga announced that they will take Bitcoin as formal currency to sell their products or games.

2) Many companies are already following the Bitcoin success story and launching their own currency such as “a new Bitcoin-like virtual currency inspired by rapper Kanye West is set to be launched, and has been named “Coinye West”. Kanye West is not involved and has yet to comment on its inception. It will follow in the footsteps of “Dogecoin”, another virtual currency based on the popular Doge meme.”

3) Amazon and Facebook are pondering their own currency too! Overall, 2014 will see virtual currencies become mainstream!

4) National government such as Singapore Tax Authorities (IRAS) Recognise Bitcoin;

Apple, Facebook and Beyoncé provide the first real social commerce case study

On 12Dec Beyoncé released her new album exclusively on iTunes without any hype or pre-release marketing. The announcement came on Instagram when Beyoncé released a fifteen-second video showing clips of her new album, followed by a Facebook post with a link to the iTunes page to download songs and videos.

Surprise!

A post shared by Beyoncé (@beyonce) on

Without a doubt, within seconds of the announcement the whole social media world erupted with a buzz around the new album and iTunes crashed due to overwhelming demand for her music.
https://twitter.com/ShreyaMehta_/status/411475919136915456

Everyone from the media to fellow celebrities jumped on the bandwagon to endorse the star and so get more eyeballs on their respective profiles and websites.

Fans too went crazy about the surprise gift for them just before Christmas from their favourite artist. They were in awe of the subtleness of this launch with no advertising and hoopla. In fact even Beyoncé critics were forced to accept this genius marketing move and were full of praise.


What does this mean for digital marketers and social commerce?

Apple (iTunes) and Facebook (Instagram), with Beyoncé, have given us the first pure social commerce case study, as this whole experience, from announcing her new album on Instagram & Facebook and releasing it on iTunes with an eruption of follow up word of mouth buzz on Twitter, did not use any traditional means of selling products and services. And yet it managed to:

1) Supersede traditional marketing channels such as newspapers, magazines, music blogs, radios and online advertising.

2) Bypass traditional commerce channels that force you to register your personal and payment details before the transaction.

3) Be a real time experience with ubiquitous accessibility and capture pre-holiday impulse buying.

I know, these are early days for social commerce, as Beyoncé is already a world famous artist, and getting huge attention on social media and exclusive deals with iTunes have made this release an overnight sensation.

And, there is strong possibility that Tim Cook and Mark Zuckerberg, along with Jay-Z, put together a deal behind the scenes in order to put Instagram and iTunes on the social commerce map, but this experience has been a lesson to digital marketers on the future of commerce, where on demand accessibility with a personal touch will define product and service monetisation, and traditional means of expensive and cumbersome advertising and transactions will have no place.