AdWeek: Despite High Hopes, Twitter’s User Growth Fell Flat in the Second Quarter of 2017

Twitter's uneven performance continues. After rumors of it being acquired, and a change in management, it seemed as if Twitter was moving in the right direction. It introduced videos to its platform, managed to see subscriber growth, and had some positive trends in its stock price. All of that changed when it announced 2Q results.

In 2Q, even with Mr. Trump using the platform as his public communication of choice, subscribers remained flat in the U.S. This is very tough to swallow given the growth of subscribers by Facebook, Instagram, and Snapchat. It's also not reassuring that management didn't really have a good answer to the stagnant growth, and that Twitter reduced expectations for the rest of the year. This could also be a conservatism tactic, but even so, most people were expecting growth.

As the article states, there were some positive developments. Twitter stated that sub count grew in their largest 12 markets.

Unfortunately, some of the skeptics are being proven right that Twitter is a nichey product with little mass appeal like a Facebook. That said, I still think they are still valuable in the internet landscape, and in the right hands could be economically viable. I anticipate an acquisition, just a question of what price to buy shares.


http://www.adweek.com/digital/despite-high-hopes-twitters-user-growth-fell-flat-in-the-second-quarter-of-2017/

Facebook reports strong earnings on growth in mobile ad revenue.

Facebook reported strong earnings last week sending the stock up over 16% on the news.  Both revenue and profits beat analyst expectations and investors were pleased to see that 49% of revenue is coming from the Facebook Mobile platform.  This is much higher than well-established advertising competitors like Google and Yahoo indicating Facebook’s strength in quickly monetizing the platform. 

The key driver in the revenue growth has been the introduction of news-feed ads- the pesky messages that interrupt the stream of your friends updates/comments when you open the application on your mobile device.  The reason these ads have been so popular with advertisers is that companies now have much better data to support the efficiency of the channel.  For example, Facebook has partnered with Nielsen and Datalogix to help collect loyalty data and to track purchased for CPG companies.  This, in turn, has given advertisers much better insight into their return on investment and has encouraged them to increase spend.  This strikes at one of the fundamental issues with investing in the social media ecosystem- that the metrics to indicate success or failure of a particular campaign or product are still under development.   I spoke with the Head of Social Media at Vice about this issue and he mentioned that the standard metrics that are currently used – reach, engagement, etc – are just a guess at what actually matters.  He mentioned that every day they his team looks at the data to understand whether they can extrapolate meaningful insights for their clients.  This is both exciting and frustrating for the marketing community.  Over the next few years, it will be interesting to see whether the power of mobile has staying power as a major advertising channel, or whether advertisers will be disappointed with the yield on their investment and put their money elsewhere.  

http://adage.com/article/digital/facebook-s-mobile-ad-revenue-49-ad-business/245027/