State of Social 1Q15: Twitter Opens Up The Ad Spigot

The 140 character social network released its Q1 2015 earnings. Let’s take a look at where the bird has landed.

Growth

Twitter grew quarter over quarter by approximately 5% to 308 million monthly active users. The network’s rate of growth has picked up after a bad Q4 from a membership perspective:

Twitter User Growth

Worth noting is that they seem to have saturated their mobile audience growth; the percentage of mobile users to total users has held steady near 80% for three quarters in a row:

Twitter Mobile Growth

Ad Revenue

Here’s the big news and the reason Twitter’s stock took a beating on the after-hours market:

Twitter Revenue

The first quarter for all social networks is always a tough one compared to the way B2C advertisers spend like drunken sailors in Q4. Yet over the years, Twitter has never experienced negative ad revenue growth in any quarter. Q1 has usually been soft, but never a loss.

Compared to a year ago, they’re still showing overall growth, but investors took note of the quarter-over-quarter loss with alarm:

NYSE_TWTR__42_48_0_21__0_50___-_Twitter_Inc

Forward Looking

Twitter’s recent moves to remove data partnerships in favor of building out its own data practice, as an additional revenue source. Expect to see more of this, as data licensing and ad revenue are their only two income streams.

Two announcements Twitter made at earnings will dramatically impact marketers. First, the purchase of TellApart means Twitter is bolstering its own advertising technology with predictive ad analytics. This will continue to improve Twitter’s ad offering, which is of benefit to marketers and communicators.

The second announcement was even more impactful:

Twitter also announced a partnership with Google’s DoubleClick platform to improve advertising performance measurement and attribution for Twitter direct response marketers. As part of the partnership, Twitter will also make its inventory available through the DoubleClick Bid Manager, making it easier for clients who prefer to centralize their campaigns on Twitter.
This is a huge deal for marketers who use Google’s Demand Side Platform, DoubleClick Digital Marketing, including AdWords users. Your Display ads may soon be appearing on Twitter, allowing you multiple ways to manage ad inventory to the network. Imagine the power of using AdWords’ remarketing capabilities (including the integration with Google Analytics’ Big Data Remarketing) with Twitter’s inventory, above and beyond Twitter’s existing ad systems.

Overall, while investors may have been spooked by Twitter’s performance, marketers should still include it in social media marketing plans. 308 million users and enhanced advertising options continue to make Twitter an essential part of a paid social media strategy.

Christopher S. Penn
Vice President, Marketing Technology

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Posted on April 29, 2015 in Advertising, Marketing, Social Media

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About the Author

Christopher S. Penn is an authority on digital marketing and marketing technology. A recognized thought leader, author, and speaker, he has shaped three key fields in the marketing industry: Google Analytics adoption, data-driven marketing and PR, and email marketing. Known for his high-octane, here’s how to get it done approach, his expertise benefits companies such as Citrix Systems, McDonald’s, GoDaddy, McKesson, and many others. His latest work, Leading Innovation, teaches organizations how to implement and scale innovative practices to direct change. Christopher is a highly-sought keynote speaker thanks to his energetic, informative talks. In 2015, he delivered insightful, innovative talks on all aspects of marketing and analytics at over 30 events to critical acclaim. He is a founding member of IBM’s Watson Analytics Predictioneers, co-founder of the groundbreaking PodCamp Conference, and co-host of the Marketing Over Coffee marketing podcast. Christopher is a Google Analytics Certified Professional and a Google AdWords Certified Professional. He is the author of over two dozen marketing books including bestsellers such as Marketing White Belt: Basics for the Digital Marketer, Marketing Red Belt: Connecting With Your Creative Mind, and Marketing Blue Belt: From Data Zero to Marketing Hero.
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