How is Twitter maintaining its growth rate?

In an interview, the CEO of Twitter Dick Costolo, reported that Twitter is “growing like a weed“. Consider the data available highlighting the growth in the number of Twitter users and the total tweets made over the years:

The stats might as well make Costolo’s claim accurate but does Twitter’s growth rate hold true for brands too? More importantly, how is Twitter trying to live up to its precedent growth rate? What’s the underlined strategy of Twitter regarding its Revenue and Profit? What direction is Twitter targeting towards?

Let’s begin by taking into account the recent updates on Twitter:

  1. More Content from Third-Party Services

In 2010, Twitter introduced the #NewTwitter version with an integration of tools like DailyBooth, iTunes, Ustream, YouTube & Twitpic while in December, services like Blip.tv, Instagram, Slideshare, Rdio and Dipdrive were also added on. Twitter is now supporting six more services which enable a multimedia upload whenever a user publishes a location-based tweet detected by Foursquare, Gowalla, Amazon, Meetup, Plancast or AOL Video. View an example:

2. Acquisition of TweetDeck

Twitter has also acquired TweetDeck, the popular third-party client for the microblogging service, for a purchase price of $40 million – $50 million including cash and Twitter stock, both.

3. Twitter: Pictures and Videos

Twitter plans on rolling out the option of uploading videos and pictures straight from Twitter.com in an attempt to replace third-party apps like Twitpic and YFrog which, according to the CEO of Twitter Dick Costelo, don’t really keep up with the fast-paced Twitter. In effect, uploads will be visible with the tweets while viewers will be able to see them without getting directed to external services.

Contrary to the rumor, users and not Twitter, will maintain complete ownership of the pictures shared. According to Dick Costelo this change will be incorporated completely in a few weeks time and should be compatible with Firefox, Chrome and Internet Explorer.

Here’s what the official video about the change says:


3. Automatic Link Shortening

Twitter now automatically shortens links shared by users (via tweets or DM) with the help of its official web application for link shortening t.co. It shortens links in 19 characters when a user presses the Tweet button and creates links which display the site that a link directs to, instead of a t.co URL. As of 9th June, 2011does not provide analytics and is not compatible with Internet Explorer. However, this should help reduce URL spam transmitted on Twitter and also help flag unsafe websites that may harm the user’s computer.

This service will still allow bit.ly to be used for shortening links but at the same time t.co can only be used for links posted on Twitter.

4. iOS 5

Apple has collaborated with Twitter for incorporating tweets right into iOS 5 hitting the iPhone, iPad and iPod devices all around the world soon. This introduction prompts apple consumers to use mobile cameras to capture anything around them and simple click tweet to share it with the world.  Tweeting could hardly become simpler of Apple users!

The integration also includes the ability to sync Twitter contacts to include updating images for your contacts from their Twitter accounts. Here’s Twitter’s official take on the Integration.

All these strategies reflect in the same direction.

Twitter is aiming to add more and more features so as to decrease the traffic generated for third-party websites like YFrog or Twitpic and aiming to increase the pace at which sharing takes place on Twitter. In effect, instead of a few seconds wasted on opening a third party website, if the large quantity of pictures and videos shared every day could be uploaded straight to the website itself, the progression at which sharing takes place could improve significantly.

Essentially, Twitter is trying to attain client applications, decrease user confusion and security concerns. “If there are too many ways to use Twitter that are inconsistent with one another, we risk diffusing the user experience. In addition, a number of client applications have repeatedly violated Twitter’s Terms of Service, including our user privacy policy. This demonstrates the risks associated with outsourcing the Twitter user experience to third parties,” says Ryan Sarver, from Twitter’s application development team.

However at the same time, Twitter is trying to capture the market for all those Twitter users who use their tweets to publish their Locations. By incorporating Foursquare and Gowalla, Twitter is trying to develop Twitter Places which would enable the generation of recent tweets related to particular places/locations. They are emphasizing on Location particularly by increasing its API (Application Program Interface) functionality and in return, offer customers more and more features.

But the question remains, apart from a few Brands like Starbucks, Intel, Hp, Ford, Skittles, Coffee Groundz, Pepsi, have smaller brands really been able to use Twitter to generate ROI?  Here are a few examples and case studies proving Twitter’s effectiveness for businesses but these are still not common knowledge, especially to smaller brands who are only starting out Social Media and usually prefer Marketing/Promotion via Facebook.

So here’s what we think:

1. Twitter is indeed growing like a weed but not necessarily for brands.

2. Twitter is trying to maintain the pace of its growth, revenue and profit by focusing particularly on Location, Photo and Video Sharing features.

3. Integration with iOS 5 has been a huge success for Twitter; making it more user-friendly for Apple users.

What do you guys think? Do you agree with our analysis? Or do you disagree? Let us know!

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4 Responses to "How is Twitter maintaining its growth rate?"

  1. Roshan Ejaz says:

    Very relevant analysis. Good Work!

  2. I have not checked in here for a while as I thought it was getting boring, but the last few posts are great quality so I guess I’ll add you back to my everyday bloglist. You deserve it my friend :)

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