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Twitter Revenue Fails to Meet Expectations

falling stock priceSince the beginning of this year, Twitter has made tons of changes to help increase the amount of users that they have on their website. So far these changes don’t seem to be making too much of a difference when it actually comes to the success of Twitter. While users coming to the site continue to go up in number slowly, their ad revenue has begun to come in far under their expected growth.

 

Stock holders are asking how Twitter plans to fix this problem since they are the ones suffer if the revenue continues to go down in the next quarter. Twitter’s response has been working on changing their ads from static text and photo ads to ones that will feature video instead. These ads can be sold at a higher price and will be more attractive to users especially those viewing Twitter on mobile platforms.

 

The problem with this is that adding video ads will make it so that their standard advertisements will not work as well. All of the video ads will distract away from the traditional sponsored tweets that many businesses have used to advertise in the past. These tweets only feature pictures and text and only show up in the users feed. They don’t have the ability to grab users’ attention as other ads can. Since Twitter added video many businesses have been going away from these ads anyway because of their decreased value comparatively.

 

If the drop in revenue is due at least partially to the decreasing value of this type of an advertisement, the hope will be that the revenue will return as Twitter adds more video elements to its social media network. With the upcoming Thursday night football games and the addition of a great deal of video content there will be more space on Twitter for this type of add. Hopefully, these changes to Twitter will help it drive up revenue in the future.

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