Twitter User Growth Stalls: Impact for Advertisers

Twitter hasn’t been able to grow user numbers for around two years now and users in the United States have actually dropped, so it’s hardly a surprise the company’s share price has plummetted. Twitter reported stagnant growth in users for the fourth quarter of last year, however, advertising revenue is still growing strongly. Some of the top branded advertisers have jumped at opportunities to promote products on Twitter, with 90 percent of this year’s Superbowl advertisers taking out Twitter ads. Although Tweeting may be dropping in popularity, it certainly seems that monetising the Twitter service is still rising.

In September 2015 Twitter highlighted that its total advertiser base had increased to 100,000, a 60 percent leap from the previous year. The next big growth area for the company is direct response ads, the acquisition of TellApart in early 2015 is helping Twitter to successfully analyse and target its advertising. TellApart is a specialist in the fields of cross-device ad targeting, audience metrics and ad targeting. The last two financial quarters have seen the Twitter ad engagement statistics jump dramatically, by 165 percent in Q3 and 153 percent in Q4.

The company state that the increased ad engagement is down to relevancy and the incorporation of video ads. In the video ad market, the advertiser is charged when an advert is viewed for at least three seconds, and the Twitter company portfolio includes both Vine and Periscope which leads pundits to predict the company will grab a large slice of the $7.7billion video advertising budget for the United States. HP took 30 seconds of branded Vines to use as a 30-second advert spot and Periscopes are now enabled within Tweets, giving further opportunities video ad promotions. Beta testing of promoted Periscopes is currently taking place and this live video mode is sure to be popular with advertisers. Doritos tested out some backstage Periscopes during Super Bowl 2016, and with some of the top brands that use Twitter to launch ad campaigns, this looks to be a surefire winner.

TellApart is having a huge impact across all the Twitter advertising and analytics. The Double Click methodology used to check out cross-device activities with mobile contributions is proving a useful aid to informing the company’s Fortune 1000 advertisers. One of the common factors across all the major brands advertising with Twitter is that ad spend is increasing exponentially. Of course, how long the Twitter ad spend increases will continue is highly likely to be contingent upon the company halting its user decline in the United. Globally, user figures for last year increased by three percent in total, so the popularity of the social media platform is a serious matter of discussion and concerns. Twitter appointed its new CTO Adam Messinger in January this year, following Kevin Weil’s move to Instagram.

The top brands will be watching Twitter’s moves over 2016 with interest. There’s talk of possible B2B advertising focus in future, with a crossover to LinkedIn and abilities to target industries and jobs.


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