Happy Twitter-versary (for the nth time around this time), Jack Dorsey. Things haven’t been going well, it seems, but there’s a light at the end of the tunnel — Twitter may be acquired by someone somewhere in the tech (or entertainment) industry, perhaps.
To be perfectly fair, the company Dorsey inherited from his predecessor(s), including an array of former product leads as well as CEO Dick Costolo, wasn’t in that great of shape to begin. But Dorsey’s return was heralded as a return to form for Twitter, in the hope that he might come in and shake things up to the point that the company would finally turn around and make Wall Street Happy.
So in the last month or so, a lot has been made as to whether the company should remain independent or whether it makes sense as part of a larger empire that can devote more resources into growing it. There are natural arguments for each — Twitter is one of the go-to sources for news (and also sports!), but a company like Salesforce could pump additional life into it to get that user base growing more broadly. And perhaps the company once again needs new fresh blood.
Dorsey’s tried to make the service less confusing during his tenure, such as shifting around the way tweets are presented and removing some contributions toward the character limit for types of media. But the company still suffers from being confusing, being difficult to get on-boarded, and of course harassment.
So, the turnaround still didn’t really happen. Let’s take a quick look at a few charts of what’s happened at Twitter under Dorsey.
Twitter stock price chart since Jack Dorsey became CEO through today (Click Image To Enlarge)
For some reference, here’s a one-year chart of the S&P 500:
S&P stock price chart during Jack Dorsey's tenure as Twitter CEO (Click Image To Enlarge)
And let’s look at the user base the company reported last quarter, which has been the main sticking point for Wall Street and Twitter:
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So, barely any growth whatsoever (and even a small drop-off at one point). Hmm. What about revenue growth? Under the leadership of Adam Bain this wasn’t a huge problem for a while, though everything still stems back to user growth.
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And Twitter’s still losing money:
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One last quick one, which isn’t exactly a chart — how much it’s paying for stock-based compensation:
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Let’s cap this whole thing off with a some recent headlines:
- Twitter’s User Growth Goes Nowhere As It Meets Revenue Expectations Of $710M
- Twitter’s woes continue on Q1 sales of $595M, a sluggish 310M MAUs and weak guidance
- Don’t feed the trolls — tackle their abuse of platform power instead
- Twitter launches on Apple TV, Fire TV and Xbox One
- Twitter will livestream weekly games from MLB and the NHL
- Twitter adds former Facebook CTO Bret Taylor to its board
- Twitter dives after mixed Q2: $602M sales, $0.13 EPS, MAUs up 3% 313M
- Twitter is introducing a quality filter to clean up your notifications tab
- Twitter partners with CBS News to live stream convention coverage
- Twitter targets extremism, suspends an additional 235,000 terror accounts
So, you may be sensing a little bit of a trend: a big shift to live video, some attempts to combat harassment and other problems (though it hasn’t worked), and of course lackluster results under Dorsey.
It’s been a tough run for Dorsey, which may eventually be capped off with a final sale to a company. Anything can change at the last minute, of course, but for the time being it seems like Twitter needs to right itself — whether that’s through increasingly drastic internal changes or bringing in new leadership under new ownership to do just that. And there’s always next year!
Twitter’s third-quarter earnings come out later this month, and it’s kind of hard to believe that this may be the final time we see the guts of the company for the foreseeable future. It may end with a final sign-off like LinkedIn:
“In light of the pending merger, LinkedIn will not be updating its outlook for fiscal 2016 and will not be hosting a conference call for its second quarter 2016 business results.”
COMMENTARY: If you've followed my blog posts about Jack Dorsey and Twitter's performance, you know that I have not been very complimentary towards Jack Dorsey, and have been just as critical about Twitter's performance. Not to be forgotten is the number of key staffers who have chosen to leave the company since Dorsey took over as CEO. In addition to the exits, revenues have failed to meet investor expectations, with the stock price dropping to near lows, and Monthly Active Users (MAU's) stalling just over 300 million users since he took over the helm.
Although Twitter has aggressively moved towards more video content (Vine and Periscope), including live sporting event streams, at its face, the overall Twitter experience has remained about the same. The homepage is still an endless torrent of tweets, without any organization or personalization. It is very time consuming to review this mountainous torrent of tweets. The result is that users are missing out on news and information that is important to them.
Twitter now allows users to attach images and videos to their tweets without affecting the 140 character limit. This is a good thing, but only a superficial improvement that a lot of users don't even notice. This is not enough to improve the overall user experience and serve as an inducement to increase user engagement and attract new users.
Twitter requires radical changes not just superficial improvements. It's a huge product design problem that must be resolved. You literally need to go back to square one and introduce an entirely new Twitter with a user interface (UI) that is unrecognizable from what you see today, and that is simple, user-friendly and intuitive. Here are a few changes that I think are greatly needed.
To combat the avalanche of tweet traffic, users should be required to classify their tweets by type (example: politics, social media, big data, legal, sports, games, fashion, personal, etc.). Users should be able to select a type before they can post it. I follow political tweets a lot, so I should be able to view all political tweets and see what's trending within that type (example: #VPdebate, #presidentialdebate, #potus, #trump, #clinton, etc.).
Live streaming event tweets should be separate from other tweets so that they clearly stand out. They should also be classified by type, and users should be able to see which live streaming events are trending (example: #presdentialdebate, #sundaynightfootball, #spaceXlaunch, #liveearthconcert, etc.).
An idea that I have proposed before includes classified ads. Twitter could be a great classified ad site, but classified ads are lost in the torrent of tweets. Classified ads would appear separate from regular news and information tweets, and would be classified by type (example: rentals, autos, household, garage sales, personals, etc.). Classified ads would be a great way for Twitter to generate additional revenues that could rival those of Craigslist. I don't know why this hasn't been done before. If I don't want to see ads within my tweet stream, I should be offered the option of paying a small fee for that privelege. Another potential revenue stream.
There you have it. If you have other ideas, don't hesitate to post them in the comment section.
Courtesy of an article dated October 5, 2016 appearing in TechCrunch
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