It wasn't so long ago that Twitter was the darling of the social media set. And why not? With over 1.3 billion accounts created, including a whopping 83% of the world’s leaders, it gave the everyman a chance to make his opinion heard. Its 140-character snackable content meant you could read updates from 100 of your favourite people in less than 20 minutes. So everyone followed everyone else and then the problems began.
With so many users, the code behind Twitter began to crumble. Its technical problems meant that while its competitors were introducing new and better features, Twitter was struggling just to not crash -- anyone remember the fail whale? Once it got its reliability sorted, Twitter introduced a number of failed features in an attempt to get the ball rolling again -- everything from conversation chronology to promoted tweets -- but nothing seemed to work. Twitter usage sank to less than 23% of registered users.
There was simply too much noise, and it became increasingly irrelevant. People are hungry for updates that are relevant to them. Both Google and Facebook cottoned on to this very early and introduced algorithms designed to give prominence to things you are interested in, and as a result usage for those companies shot up. On Facebook it became easy to follow 400+ friends and still feel connected to each one of them. Google became so good at showing you relevant results that 91% of searchers do not go beyond the first page. Meanwhile, Twitter continued down the shotgun approach, and continued to show you everything all the time. With 500 million tweets sent each day, it became too much to follow.
Even so, Twitter still had that massive audience to its benefit. The world’s newsmakers and news writers embraced Twitter like a nana to grandchildren. In fact, among Twitter’s verified accounts, journalists make up 24.6%. Twitter quickly became a force for breaking news. During the 2014 FIFA World Cup alone, over 600,000 tweets were sent.
Those same newsmakers attracted huge followings. As Twitter increasingly became a news outlet, it began to lose that special thing that made it a social network -- interaction. Even the indomitable Katie Perry couldn't possibly interact with even a fraction of her 87 million followers.
The seismic shift to publishers led to an inevitable change in user behaviour. Twitter went from a site you chatted on to a site you read, and with that Twitter lost its reason to register. After all, why create an account or even log in if all you are going to do is read something? In an average month, 500 million visitors don't even bother to log in. In fact, of that staggering 1.3 billion users, 550 million accounts have never even sent a tweet.
Social media platforms are valued for several factors, and key among them are user growth and engagement. Twitter delivered that in spades in its first six years, and its investors were rewarded. But while it moved from a social media platform to a media outlet, its investor demographic did not. This is why the stock has performed so badly in in the last four years -- dropping over 20 points.
People still think they are investing in that plucky social media company when they should be looking at Twitter as the modern news outlet it is.