​INSIGHT: Despite earnings gloom, don’t count Twitter out

Despite Wall Street’s pessimism following Twitter’s 3Q earnings, industry analysts have several reasons to be optimistic about the social network.

Despite Wall Street’s pessimism following Twitter’s 3Q earnings, industry analysts have several reasons to be optimistic about the social network from a marketing perspective.

At present, Twitter has struggled to gain traction with investors, first and foremost because it is (unfairly) compared to Facebook, whose global growth has been nothing short of spectacular.

Throw in the acquisition of social network darling Instagram, and Facebook holds the bar very high in the minds of the investment community.

“But for marketers, there is much to celebrate in the return of CEO Jack Dorsey, and his refocusing of the company on two key areas: user experience and content,” observes Jay Wilson, research analyst, Gartner.

As Dorsey mentioned on the company’s earnings call, he needs to “make Twitter a whole lot easier to understand.”

“I can’t tell you how many times I have conversations with friends, relatives, and yes, even senior marketing leaders, who tell me they just “don’t get” Twitter,” Wilson says.

“My response is typically this: If Facebook is a place where you share life’s milestones with friends and family - people you know in real life - Twitter is the place where you interact with people who you don’t know in real life, but with whom you share common interests.”

Over time, Wilson believes those interests have increasingly skewed towards live, communally experienced events - whether it’s watching the Arab Spring unfold, live-tweeting the GOP debate, or the premier of “The Walking Dead.”

“Twitter, for all its troubles, still owns those live moments, those second-screen experiences,” he adds.

“But unless you were a seasoned Twitter user, it was tough to experience those moments in a coherent and chronological way. Twitter Moments, as Snap-chatty as it is, begins to lower that hurdle.”

And even for skilled social marketers, Wilson believes it was difficult to take advantage of those opportunities from a targeting perspective.

“Twitter Event Targeting should help solve that problem, and open marketers’ minds (and budgets) to new possibilities, particularly in the context of the challenges facing them in display performance,” he adds.

“Rather than panicking in the face of Wall Street demands for Monthly Active User gains and better earnings per share, Dorsey seems to have set forth on a methodical path to improve the user experience (for both consumers and advertisers) first, while enabling content creators and developers to contribute more to the Twitter ecosystem, including Vine and Periscope.

And with better content, delivered in a way that’s easier to understand, the new users, and eventually the dollars, will come.”

By Jay Wilson - Research Analyst, Gartner

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