Tag Archives: Twitter commerce

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.

Instagram Stabbing Itself By Leaving Twitter Cards Off

Hunter Walk

YouTube never disabled embeds on Twitter or Facebook, letting visitors to those products watch a YouTube video without ever coming to our site. YouTube worked with Apple to make our app a default experience on iOS, even leaving it effectively non-monetized until last year. Why? Because we knew our users were on those sites and we wanted YouTube to be synonymous with “video.” Because we knew we could create a differentiated on-site experience which drove clicks back to our site from those embeds. And because we knew that our community was OURS only so long as we served THEIR needs.

Instagram photos ceased being viewable on Twitter last December due to a strategic decision by Facebook management, which Twitter CEO Dick Costolo said was “their prerogative.” At the time Instagram was building out a web presence and seeking overall to drive more consumers to view photos within Instagram…

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Things I Learned Working on the Twitter Platform

Ryan Sarver

I was lucky enough to spend the last four years of my life working with an incredible team of people on the Twitter Platform. I joined Twitter in June of 2009, shortly after Alex Payne had launched and built the early community around the Twitter API. While my role initially entailed product and engineering management, I spent all four years focused on building an ecosystem of companies that created value for our users and our partners and that’s where I’ll focus these posts. It was my first time doing anything like it and I learned an incredible amount through trial and error. There were failures, triumphs, and great lessons learned along the way.

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Dick Costolo is right to aim for one billion twitter users and more monetisation maturity before an IPO

Seems like both Twitter and Wall Street are embracing the Twitter IPO sometime in Q4 of 2013 or very early in 2014. No doubt Twitter growth has shown loads of promise and, in the leadership of Jack Dorsey and Dick Costolo with some notable new hires, they have a very balanced team in place to execute the plan. In addition, recent Super Bowl data more or less confirms that Twitter has become a second screen while watching telly!

https://twitter.com/Twitter/status/298310493230206977

From Grammy Awards to Olympics, everything seems to be gaining momentum at Twitter, and no one can ignore Twitter’s growth: the number of users has doubled since 2011, and the range from celebrity to businesses to the masses has made this an integral tool for information publishing and gathering!!

https://twitter.com/Twittercomms/status/300851167909523457

To monetise their success, Twitter has been rolling out various advertising and data mining products such as promoted accounts’ tweets, and licensing Twitter stream to 3rd parties! And the results are very encouraging too: Twitter has generated over 300m revenue and a variety of companies from Kuwait investments to the Black Tones have invested a substantial amount to leverage this service!

But despite all this success, the $10billion question is, is it really a $10bn company? That’s the evaluation by secondary market; and is it really ready to go public, and has it got a proven and sustainable long-term revenue model? And how can they make sure that they will not meet the same fate as Facebook, Zynga and GroupOn, when launching into the stock market?

http://siliconangle.com Image

To find the answer, let’s look at what Twitter has in its armoury to justify its valuation, and the potential products and services they can offer to keep generating value for their shareholders.
Like Google and Facebook, Twitter too is a numbers game
Twitter is playing their huge user base card, which no doubt is really very impressive, and as soon as they roll out its services to other countries it grows exponentially! Current stats suggest it has over 200m active users with 30% growth every year. These can be categorised into 40% active participants (i.e. those who read and write tweets) and 60% listeners (who only read tweets from top brands, celebrities and friends). Twitter claims around 40% of people follow brands to find special deals and new product information, and 80% follow their favourite celebrities and journalists to keep up to date with news, gossip and other information. Overall, Twitter has a huge base with a vested interest in business-driven information, not just focusing on mingling with friends like Facebook!

Twitter can leverage its user base by selling advertising
Considering Twitter has a huge user base interested in various types of information, they have come up with the idea of an interest graph to help businesses to leverage people’s interests. Therefore, like other content driven businesses, they have launched advertising products like promoted accounts and tweets. They also verify businesses for a fee, to give them more credibility on their platform. In summary, these products are very basic online advertising products with similar kinds of conversion ratio, which would act as cash cow for Twitter in the long run.
https://twitter.com/TwitterSmallBiz/status/301384233249820672

Platform openness enables Twitter to license their data too
Twitter via Gnip and DataSwift and them self has gone into 3rd party data licensing where Twitter sells data generated on their platform to businesses for further integration and analysis; no doubt this has huge potential for business, as this can help them to trap customers and/or market sentiments and subsequently help them to develop their products and services. Lately businesses have also used Twitter as a communication channel to provide customer support!
https://twitter.com/crowdedocean/status/138347832267640832

And now, like LinkedIn, Twitter is exploring industry-specific B2B products
They are also actively integrating and exploring opportunity on TV analysis and recently got into a partnership with Nielsen and bought TV social media analysis company Bluefin Labs. This shows Twitter is ready to leverage their success from last Super Bowl, where 50% of advertisers integrated Twitter hashtags to carry on conversations with customers after their 30 sec TV ads. This is a huge opportunity for Twitter as TV is still gets the most eyeballs for businesses; however Facebook is also apparently testing a watch button, which means Twitter could face stiff competition from its obvious competitors.

Twitter with Amex has introduced commerce too

Twitter has also taken an initiative with Amex to enable users to buy products just with a tweet; it is an enormous minefield to explore as Twitter with credit card details and using hashtags can really make commerce very simple, but users might shy away from using tweets as a buying instruction, as you are telling (or spamming) the world, not just friends, that you have just done the transaction. Facebook is trying this concept with Facebook Connect and Facebook Gifts.

https://twitter.com/satyap/status/301227867554082816

Twitter is replicating the micro-blogging concept with video and images!!
Like any tech company from Google to Facebook to Apple, Twitter too has a huge challenge to come up with a product line so that investors can see scalability and be comfortable with investing. The reason for this is probably that in this day and age disruptions occur at supersonic speed and if Twitter keeps banking on their obvious product line, it may not be on the map after a while. However, Twitter is aware of it and they have already introduced a Twitter-like video service, @vine, and have improved image attachments to take on Instagram and Pintrest.

But and it’s a big but – Twitter will always have issues about data ownership and Privacy
I think Twitter will at some point find themselves in the middle of a data ownership controversy where they will be in the crossfire with authorities and their users for not sharing the revenue with those generating content on their platform. Basically, Twitter is licensing and analysing, and subsequently selling, data that is not produced by them and therefore, somewhere along the line, someone will ask the question, why is the content producer not getting a share from data licensing?
I think Twitter might need to adopt the Youtube business model where they share revenue with publishers too.
https://twitter.com/SanFranciscoCP/status/275618801897312256

Per user valuation might be too high like Facebook?

Facebook launched $100bn valuation IPO by valuating per user around $100, when they were yielding only $3/user and subsequently struggling in the stock market. LinkedIn valued their company around $4.3bn for an IPO, when they were making around $5/user and now trading at two times of the list value. So for Twitter with $1.5/user, a $10bn valuation might not be the best valuation?

*Note: Calculations are based on Facebook Revenue $3.5bn and 100bn users, LinkedIn revenue around $944m with 200m users and Twitter revenue around $350m with 200m active users

Twitter technology and ecosystem desires more!
Twitter was recently blamed for killing its most progressive ecosystem when they suddenly changed their API terms and conditions, citing the reason that there are too many hackers around, stopping Twitter making their services consistent across the platform. However even after that, technology is still not resolved e.g. tweets are not synchronised on all platform i.e. if I deleted a tweet on iPhone, it still appears on my web client, if I don’t delete from there too!

Conclusion – All going in the right direction but Twitter need to prove more monetisation tools than advertising to launch an IPO!

Overall it seems Twitter is, like Facebook, making sure that they have strong user base and, like Google, they are hoping to leverage big data produced on their platform via selling advertising. The openness of Twitter has also enabled them to license their data to businesses for further analysis and/or use their content to provide industry specific products. Plus, the lesson they have learned from Facebook’s recent hiccup on the stock market and Apple’s on-going agony of not having a product roadmap, forced them to start thinking of future products, leading to partnerships with Nielsen and Amex and the launch of micro-video-blogging app @vine, which means Twitter is ticking all the right boxes.

However, despite being on right path, apart from growing their user base and advertising products, the rest of the products need to be monetised before Twitter can launch into the stock market. After the Facebook, Zynga and GroupOn stock debacles, any move from tech companies will be received with a pinch of salt by investors. Also, Twitter as a sharing platform might need to embrace sharing economy i.e. sharing revenue with content producers to ensure they have sustainable non-controversial revenue model and do not end up in various court battles. Therefore, the right thing for Twitter is to first prove their model beyond advertising, and then to value their company correctly before launching on the stock market. But would investors have the patience to wait that long, given that businesses lifecycles are shortening at lightning speed these days?

Is it really mobile vs. social or mobile + social = commerce?

As soon as the black Friday commerce data was published with a thumbs up to mobile commerce and a hard beating to social commerce, people started doubting all the hype surrounded social commerce! In a way this thrashing can be justified, as businesses are now expecting significant return on investment after spending substantial amounts of money on social media marketing, from paying consultants to running guerrilla campaigns to engaging people via this medium.



Black Friday Commerce Stats

On the other hand, an introduction of smartphones and tablets has hugely boosted the mobile commerce numbers and if you believe the pundits, by 2015 every 3rd online transaction will happen via mobile device and every second offline buyer will check goods prices on a phone before buying it in the shop!



And as a result of this, every online and offline retailer is vigorously competing to introduce apps with all the latest technologies, such as voice recognition, Image and barcode scanning, to win mobile-savvy customers and to support mobile payments; meanwhile, all remittance suppliers are surging ahead with one-click mobile payment technology!

Which means, if John Smith wants to buy a tie he’s just seen in a magazine or website, he will scan that on his phone to check best available price and buy in one click to be delivered next or same day to him! i.e., the convenience at the best for price sensitive customers!!

So the question is – in this mobile and app commerce world, where does the social commerce fit, or is there any room for the social-verse when all swords are out for Social ROI? And the answer is – definitely social commerce is going to prevail due to simple reason that, we gradually start spending more of our online time on social media networks,those have become our second point of contact when we are watching TV, dinning at restaurants, shopping at mauls or even spending time with friends.

However, there will be a transition, or perhaps it’s already happening, from finding information (or products) on social media to eventually buying the product from that medium! Currently even social media networks from Facebook to Twitter to Google+ to Pinterest are positioning themselves as information gateways, so that when it comes to finding the best shopping trends, images, ratings and reviews, many look at their social universe but still buy on at non-social network platform ranging from Amazon to eBay.And for businesses social media is the place to collect data as thousands of people around many platforms are talking and sharing views continuously about their products!



I think the next stage would be, or perhaps already is, that we will be able to buy desired products from purely social networks rather than using them just as pre- and post-sale discovery tools.
https://twitter.com/EyeTraffic/status/273790707448295424

However, I am not a firm believer in an app economy i.e. I don’t believe that apps running on social media will be the main tool of its transition from discovery to transaction tool.
https://twitter.com/cdrz24/status/274399817856335872
https://twitter.com/cyclonesworld/status/276411835677294592

But, if Facebook, Twitter and especially Pinterest can become pure marketplace for both suppliers and consumers, yet maintain consumer privacy and business identity, than they have a winning formula.
And, to a certain extent, Facebook, Google, Twitter and Pinterest brand pages, widgets and APIs are gradually building social interest and knowledge, and professional graphs, which are the right steps in social commerce directions, where both businesses and consumers can interact and know each other. However transactions with payment are still a stumbling block as these networks don’t have their users’ credit card info, which means that to make payment on social networks, both suppliers and consumers needs to seek third party help.

I think here Apple, Amazon or eBay, with millions of consumers’ credit card details, are in very advantageous position, and if they somehow manage to amalgamate social media to their platforms, then we have winner too! But Apple, with Ping, has already burnt their hand in this area – eBay is currently going all image driven (like Pinterest)– results are yet to be seen! And Amazon reviews remain one of the most prominent places to find product information, but not the place to hang out with friends!

https://twitter.com/Hugop848/status/276180713613692929

Overall even, if we know the winning formula for Social Commerce is eBay + Facebook, there are still a few very hard yards to cover to reach this stage. We all know that just as we don’t hang out with friends in shops and don’t buy goods in restaurants or bars, it would be a humongous task to mix social and ecommerce sites, but I am sure we are not far now from a time when we will have the technology to mix these two, leaving buyers’ privacy and business identity intact. And while this transition will take place, mobile will become (or has already become) the prime device to find and buy products and services. Which means the formula for successful monetisation would be mobile device + social network = commerce!

Will @twitterAPI support social CRM and Analytics, as promised?

Lately Dick Costolo (CEO @Twitter) has been vigorously advocating at various podiums (Charlie Ross Show and Online News Association Conference Awards Banquet) about the twitter API policy changes, and, to certain extend , I agree with their policy to stop encouraging developers (or hackers) to create a twitter-like experience somewhere else.

OK, now we have bought this idea, but then why is Twitter not giving users (i.e. tweeps) exactly the same experience with their various client interfaces, from iPad, iPhone, Android to web? For example, on the web they don’t have Retweet (RT) with a quote option and some mobile clients don’t have $tag hyperlinks. And then they have no analytics (for non-twitter advertising subscribers) associated, apart from number of RT and favourites.

Also in Michael Sippey’s (Product person @ Twitter) blog posting to introduce API changes seems to encourage developers to build something on top of Twitter such as social CRM and analytics tools, but if Twitter is really serious about that, then why don’t they take API rate limitation off, or why do they suspend accounts if you do too many @mentions?
https://twitter.com/93HZiTao/status/250193965121413121
These limitations are the biggest hindrance in creating a meaningful conversation with tweeps. I know Twitter can argue that unlimited API usage and @mentions can cause spamming, but all marketers can agree that information overload can occur in a variety of media and can’t really can be controlled by some rate limit or usage checks! Can Twitter control spamming via API authentication and subsequent usage analysis checks? How about Twitter opening their ads API (as Google did with ad words) to developers, which would give huge opportunities for developers to create a true commerce experience on twitter!

We know @twitter is free tool and they still have a more open ecosystem than FB, G+, Pintrest and LinkedIn, and if I put my developer’s hat on, it is not easy to manage (free) API usage for thousands of hackers who are hungry for the opportunity to create as many as disruptions as possible and to enjoy and prove their creative skills, but what Twitter has to realise is that the amount of content they generate every second, they cannot manage and monetise alone; therefore rather then that abundance of info go in waste, it should be open to use for developers to turn Twitter into a true social engagement system.

In the end, OK Twitter, don’t let us create a Twitter client-like experience, but, as promised, give us tool to build a Twitter analytics and relationship management system so that we both developer and Twitter can carry on growing and become the best social CRM and content management tool!