MAU of 313 million as opposed to 500 million from nearest competitor Instagram suggests the company is falling behind in terms of relevance amongst users as new rival Snapchat comfortably overtook the worrisome news feeding outlet in the month of June.
Some might argue Twitter's target market could be the reason for the company's stagnancy with the market leader Facebook together with its ownership of WhatsApp messaging service tapping into a youthful audience less reluctant to engage fully with its services. Whereas Twitter feeds the new community, a rather small amount of social media users, its rivals have leaned their platforms towards interaction on a personal level which clearly is working.
This in effect leads more users to be drawn to the platform, leading advertisers to showcase their products where they get the greatest exposure. Twitter haven't enhanced their platform enough to encourage more users to join leaving revenue growth prospects bleak and advertisers less willing to place their marketing campaigns on their platform.
So much promise had been made at the start of Dorsey's second tenure yet we haven't seen the fruition of ideas come to light. Probably the most disappointing measure that was reported yesterday was the drop in research and development costs. It's as if management isn't committed to improving the functionality of its platform which flies in the face of amassing new users.
Back in February I wrote a piece saying mergers and acquisitions in the social media space could be a big news story this year. So far we haven't been left doubtful with Microsoft's purchase of LinkedIn and more recently Verizon's takeover of Yahoo's search engine. With Twitter market valuation under consistent pressure from stockholders the likelihood of a buyout from a bigger firm is increasing.
Who will that company be?
Twitter shares dropped 10% in after-hours trading after it missed revenue estimates https://t.co/UJLdQ4helX pic.twitter.com/rIFEk4n8sD— Forbes (@Forbes) July 26, 2016
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