Twitter's Marketing Problem
Joyce Park stashed this in Tech biz
Really good essay on what happens to a company when their startup idea is SO GREAT that the founders don't have to work very hard on product-market fit.
This is the best part here:
The only thing that matters is getting to product/market fit…I believe that the life of any startup can be divided into two parts: before product/market fit (call this “BPMF”) and after product/market fit (“APMF”).
When you are BPMF, focus obsessively on getting to product/market fit.
Do whatever is required to get to product/market fit. Including changing out people, rewriting your product, moving into a different market, telling customers no when you don’t want to, telling customers yes when you don’t want to, raising that fourth round of highly dilutive venture capital — whatever is required.
When you get right down to it, you can ignore almost everything else.
...which I take to mean that if product/market fit just falls into your lap (like it did with Twitter) then the company is not as equipped to deal with what happens when suddenly growth slows or stops.
(By the way, the part Greg highlighted comes from Marc Andreessen in 2007.)
If an advertiser wants to reach someone like me – and they certainly do, given my spending habits – Twitter is by far the best way to find me. Were Twitter able to consistently capture this signal and deliver effective ad units that caught their user’s attention, they could command some of the highest average revenues per user on the Internet.
The problem for Twitter is that getting a user as finely tuned as myself is not at all an easy process. My interests are so easily identified because I constantly edit who I follow to make sure my signal-to-noise ratio is as high as possible. However, this sort of behavior is totally unnatural and overwhelming to a new user. I hesitate to tell others how valuable I find Twitter, simply because I don’t know how to explain to them how to make Twitter as useful to them as it is to me.
The author is right when he revisits this concept:
Nothing has really changed: Twitter continues to know a lot about me and other heavy users, and is figuring out how to monetize that, but there just aren’t enough people like me. I know Twitter is trying to spin MoPub as giving them access to a billion users, but without the data derived from Twitter usage, those billion users and the ad impressions they see are just more undifferentiated inventory; there’s a good reason display ad companies are worth a lot less than social network ones.
That's the heart of what ails Twitter right now.
Twitter suffers from not having a SINGLE product-market fit.
It is many things to many people:
An interesting side effect of Twitter’s inability to articulate their core value prop is that anyone and everyone has advice for how they might improve (including me!). Combine that with the fact that Twitter serves so many different use cases – real-time news, de facto RSS reader, public chat, just to name a few – and you have a paralysis of choice not only for new users but also for Twitter’s marketing and onboarding teams.
So why not embrace the complexity? Instead of trying to teach new users how to built a curated follower list, build the lists for them. Don’t call them lists, though; embrace Twitter’s TV connection and make them “channels.” Big basketball game? Go to the basketball channel, populated not with the biggest celebrities but with the best and most entertaining tweeters. Build similar channels for specific teams in all sports. Do the same for Apple, Google, and technology; liberals, conservatives, and politics in general; have channels for the Oscars, the Olympics and so on and so forth. And make them good, devoid of the crap that pollutes most hashtags and search results. If the ideal Twitter experience is achieved with a curated list, then provide curated lists and an easy way to switch among them.
Now you have a value prop: easily join the conversation about what is happening in the areas you care about, without the months-long process of building a perfectly customized Twitter feed. Oh, and by the way Ad Person, here is a very easy-to-understand ad unit built around a specific topic filled with self-selected followers.
That's a good idea, but it's hard to do. Really, really hard.
So hard that no one has managed to do it yet.
Twitter is like a lottery winner than never learned to earn its own money:
I think this actually gets to the problem with Twitter: the initial concept was so good, and so perfectly fit such a large market, that they never needed to go through the process of achieving product market fit. It just happened, and they’ve been riding that match for going on eight years.
The problem, though, was that by skipping over the wrenching process of finding a market, Twitter still has no idea what their market actually is, and how they might expand it. Twitter is the company-equivalent of a lottery winner who never actually learns how to make money, and now they are starting to pay the price.
The price I’m referring to is the truly disconcerting slowness in user growth and engagement that Twitter reported earlier this week. Twitter reported they increased monthly-active-users (MAUs) by 5.8% from the previous quarter, and 25% year-over-year (YoY), and that timeline views increased 15%. That was down from a 30% YoY increase in MAUs and 26% increase in timeline view last quarter. On the flipside, Twitter posted excellent financial numbers, increasing revenue by 119% YoY, and increasing their ad revenue per MAU by 65%. This too, though, is very unconventional. Ad-supported services are supposed to grow their user base first, and then figure out how to monetize later.
The problem with twitter and anything like it for that matter is you cannot control the content and culture. Twitter has turned into a propaganda machine for media types. I have been trying to use it to test whether the financial gurus that tweet a lot are of any help to actual financial decision making.
THEY ARE NOT!!!!
Which is no different than CNBC or Bloomberg either.
Twitter $ search is great. For example if you want to see who got interest rates right this YTD you can quickly go back through three months of $TLT. (Hint almost no one got it right and most followed were dead wrong)
If you try to talk with any news or finance or entertainment or thought leader they at best favorite a tweet but will never converse. They are self promoting and only talk to twitter "equals or above"
Like I want to watch and read talking heads argue or mutually admire each other.
I know a number of people at RAND and they are encouraged to tweet and they don't. RAND will tweet out research but it doesn't get picked up. For example their latest landmark study on Military Care Givers had near zero media coverage. (There was a plane that was still missing)
Point being it is an adjunct of media outlets and if I don't watch it or read it and ignore advertising on TV and NyTimes/washpo there is no way it I am going to engage with them on twitter if it doesn't flow both ways.
No one needs a bigger echo in a toxic echo chamber.
If everyone who uses $ on Twitter is wrong, can they be used as a negative signal?
As in, do the opposite of the $ people?
Sentiment indicators in any form are tough.
In this case bonds and equities are disagreeing but timing is everything.
What is so bad is people can be consistently wrong on huge events but never held to account. If you replay what they said you are a troll.