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Can comeback CEO Jack Dorsey turn Twitter around?

Twitter's revenues are in good shape but its CEO needs to start securing more users to keep investors happy.

Investors are still unsure about Twitter’s prospects. The tech company’s stock dropped by 10% after reporting low user growth in its third quarter earnings report, despite seeing revenue grow by 58% compared to 2014.

The firm added just 3m new users since June – paling in comparison to rival Instagram, which saw users grow by 100m to reach 400m users in the past nine months alone.

Delivering on the equation of revenue and user growth is no mean feat – and the firm’s new CEO Jack Dorsey has a tough job on his hands. But he appears to know at least what it takes to boost the company’s popularity.

The comeback kid

Comebacks might be frequent in the world of sports and music, but not so in the world of CEOs. Dorsey is hoping to follow in the footsteps of Steve Jobs in returning to the company he co-founded to help turn its fortunes around. Dorsey helped launch Twitter in 2006 and was its first CEO. But he was replaced by Evan Williams in 2008, another co-founder of the company. Dorsey went on to form Square Inc, a business platform for card payments on mobiles in 2009 and remains its chief executive – something that he has been criticised for.

He returned as interim CEO in July 2015 and the job was made permanent in October 2015. His predecessor, Dick Costolo, spoke of the pressures involved in running a public company – particularly, dealing with the short-term thinking fuelled by stock market expectations. Satisfying short-term expectations in a firm that also needs to build a long-term vision is now the battle Dorsey must fight.

When he first took back the reins, Dorsey laid out a vision to simplify Twitter’s product offering – to make it easier to understand and more approachable to people. He said it would focus on “big bets across Twitter, Periscope and Vine.

The question is if and when this simplification will begin to deliver. The number of monthly active members did actually rise 11% year-over-year to 320m and saw a slight rise from 316m in the previous quarter. But more work needs to be done – and at a higher tempo. Making Twitter easier to use is the key challenge the company faces to increase its user base.

The Q3 revenue of $569m points to a rise of 58% year-on-year, $9m above its forecast range. Of this revenue about 90% came from advertising ($513m, an increase of 60% year-on-year). And an impressive 86% of the total advertising revenue was mobile-based. The forecast range for Q4 is $695m to $710m. Yet, in the metric of monthly active users, which is often used by investors to judge the long-term prospects of social media firms (as it helps attract even more advertising revenue), Twitter is struggling.


Twitter’s share price before and after Q3 results on October 27. Google Finance - AOL Money - Yahoo Finance


Twitter’s moment

Three areas encapsulate what is happening at Twitter at the moment: Twitter’s new Moments feature, videos and the way it targets small and medium-sized businesses. Moments is a new product that organises tweets, pictures and video around live events that users can choose to follow. It features the best stories happening on Twitter, prepared by Twitter and select partners.

According to Dorsey, Moments represents a fundamental shift in Twitter’s thinking – organising content by topic instead of timing, where users follow topics live instead of accounts. This sums up the current efforts to make Twitter easier to understand for both users and advertisers.

In an effort to boost its popularity, Twitter aired its first TV advertisement to showcase Moments during the World Series Baseball tournament. The ad created a backlash from some Twitter users, however, who found it complicated and were unsure of the message it was trying to convey. This vividly shows the dual challenge Twitter has of engaging both new users through a simplified interface and current ones who want extra functionality from the service it already provides.


Twitter’s first ad


Advertising is already offered within Moments. But as this is a relatively new service, there are still questions to be addressed: will developers and advertisers adopt Moments as a novel way to reach out to current and new audiences? Will Moments help Twitter increase its user base?

Increasing the “in-app experience” that Twitter offers is an important area of development for the company. Similar to Facebook’s Instant Articles, keeping users inside the app instead of having hyperlinks send them onto a web browser, is an important part of keeping users engaged in their services for longer. The result is more frequent use of its service and more attention by advertisers. And, with the volume of video consumption on the rise, Twitter is trying to attract the video ad budgets of advertisers. In the next quarter there will be more related products released, such as new video features in the form of Promoted Moments.

Finally, Twitter hosts 9m small and medium-sized business' accounts that are a new marketing channel that Twitter and its advertisers have yet to fully utilise. If these businesses view Twitter as a way to connect to their users and suppliers easily and more effectively, then they might be more willing to use the array of services and advertising options Twitter is offering (for example, exclusive promotions to their followers).

It takes time and effort to turn a business around. And it is at this precise moment, when time seems to be running out, that Dorsey and his team need to step up their efforts. These efforts need to strike a balance by improving current products and offering new services. It is only then that Twitter, and its CEO, will start delivering on both revenue and user growth.

Sotirios Paroutis, Associate Professor of Strategic Management, University of Warwick

This article was originally published on The Conversation


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With those withdrawal symptoms kicking in, all you need is a good rebound show.

Hangovers tend to have a debilitating effect on various human faculties, but a timely cure can ease that hollow feeling generally felt in the pit of the stomach. The Game of Thrones Season 7 finale has left us with that similar empty feeling, worsened by an official statement on the 16-month-long wait to witness The Great War. That indeed is a long time away from our friends Dany, Jon, Queen C and even sweet, sweet Podrick. While nothing can quite replace the frosty thrill of Game of Thrones, here’s a list of awesome shows, several having won multiple Emmy awards, that are sure to vanquish those nasty withdrawal symptoms:

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It’s a distinct possibility that your first impressions of this show, whether you form those from the trailer or opening sequence, will make you think this is just another sun-kissed and glossy Californian drama. Until, the dark theme of BLL descends like an eerie mist, that is. With the serious acting chops of Reese Witherspoon and Nicole Kidman as leads, this murder mystery is one of a kind. Adapted from author Liane Moriarty’s book, this female-led show has received accolades for shattering the one-dimensional portrayal of women on TV. Despite the stellar star cast, this Emmy-nominated show wasn’t easy to make. You should watch Big Little Lies if only for Reese Witherspoon’s long struggle to get it off the ground.

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The Night Of is one of the few crime dramas featuring South Asians without resorting to tired stereotypes. It’s the kind of show that will keep you in its grip with its mysterious plotline, have you rooting for its characters and leave you devastated and furious. While the narrative revolves around a murder and the mystery that surrounds it, its undertones raises questions on racial, class and courtroom politics. If you’re a fan of True Detective or Law & Order and are looking for something serious and thoughtful, look no further than this series of critical acclaim.

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When everything else fails, it’s comforting to know that the family will always be there to lift your spirits and keep you chuckling. And by the family we mean the Dunphys, Pritchetts and Tuckers, obviously. Modern Family portrays the hues of familial bonds with an honesty that most family shows would gloss over. Eight seasons in, the show’s characters like Gloria and Phil Dunphy have taken on legendary proportions in their fans’ minds as they navigate their relationships with relentless bumbling humour. If you’re tired of irritating one-liners or shows that try too hard, a Modern Family marathon is in order. This multiple-Emmy-winning sitcom is worth revisiting, especially since the brand new season 9 premiers on 28th September 2017.

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9. Dexter

In case you’re feeling vengeful, you can always get the spite out of your system vicariously by watching Dexter, our favourite serial killer. This vigilante killer doesn’t hide behind a mask or a costume, but sneaks around like a criminal, targeting the bad guys that have slipped through the justice system. From its premier in 2006 to its series finale in 2013, the Emmy-nominated Michael C Hall, as Dexter, has kept fans in awe of the scientific precision in which he conducts his kills. For those who haven’t seen the show, the opening credits give an accurate glimpse of how captivating the next 45 minutes will be. If it’s been a while since you watched in awe as the opening credits rolled, maybe you should revisit the world’s most loved psychopath for nostalgia’s sake.

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