Well, there are people who would be quite willing to debate the topic. Twitter’s latest earnings report saw its advertising revenue actually go down by small amounts y-o-y, however there have been some improvements too that Twitter has been all too quick to highlight. The company is attributing these gains to product improvements — and not, as has been suggested, to its coverage of events like presidential debates and of course, the all too witty tweets from President Donald Trump.
However, Twitter says that product changes made over the long term were more responsible for the gains it made, rather than ephemeral events like the presidential debate or even Donald Trump’s tweets — which were being pegged as a big potential driving factor. After all, people would be interested in knowing what the president of the most powerful country in the world has to say. Despite a substantial increase in traffic during the elections, Twitter CFO Anthony Noto states that the majority of Twitter’s usage improvements came from product changes.
And there have been improvements, make no mistake. Despite Twitter’s less than impressive performance that saw it fall short of Wall Street expectations, the compoany added 2 million users to its monthly active user base. Daily active user base saw similar gains, increasing by almost 11 percent year over year. Ad-engagements took a similar path and registered a 151 percent growth year over year. The company is now looking to focus upon areas that are already doing well.
Speaking about President Trump’s Twitter usage to TechCrunch, Noto said:
I would say is that the President’s use of Twitter has broadened the awareness of how the platform can be used, and it shows the power of Twitter. When he tweets, it sparks conversation and discussion. So at a macro level, discussions on a platform really helps us be the best at showing what’s happening in the world and where discussion strengthens our key differentiators and comprehensiveness fast.
But he still refrained from giving direct credit for the company’s growth to the recently elected US President, a fact that might just offend the later.
From a quantitative perspective, what I’d say is each quarter, we measure and analyze factors that drive causal growth in the audience, not coincident growth. In the fourth quarter, the primary driver of our growth was, as I said earlier, product changes and marketing.
Indeed, if president Trump was to know about how product changes and marketing were pegged as having been more instrumental to Twitter’s growth than his own words — well, he might just have something to say on the matter.
Meanwhile, what Twitter essentially seems to be attempting to communicate is that while the presence of eminent personalities, people that others follow and look up (or in some cases, down) to is important and is a driving factor, it can only convert into significant gains if the overall usage experience is a good one. Now that is something that is even harder to achieve than controversial tweets from the president. Twitter for example, has long been a hotbed of harassers and trolls — not exactly people who bring positivity to the table. However, the company has been setting out some strict measures to deal with them once and for all — including permanent bans.
As far as events like presidential debates are concerned, Noto said that while a positive thing for the platform, the total growth contributed by such events distributed over the course of a quarter or year is, if not essentially insignificant, not particularly important. More significant is the changes that the platform has been making at a fundamental level to improve the experience for the individual end users.
I think I’ve talked in the past about even on nights of the presidential debates, we would have like a 10% lift in Tweet impressions. And even if I assume all of that lift is incremental, it only could translate into a 0.1% lift in impressions for the entire quarter. So to get double-digit growth for an entire quarter in impressions for 3 quarters in a row takes a fundamental change, and that’s being driven by machine learning in the timeline.
The machine learning referred to here is the same technology that surfaces content relevant to you on your feed. When stuff relevant or interesting to you comes up on your feed, you are much more likely to stay on and even keep coming back to the platform. Videos has also been an important driving factor for increased user engagement on Twitter’s platform and the company says that changes made at the product level, are what have actually been driving growth for the company.
