Twitter Introduces New Features to Increase User Engagement
Twitter Spooks Investors with 1Q15 Earnings (Part 5 of 5)
Twitter hopeful for a turnaround
After a below-par 1Q15, Twitter (TWTR) is hopeful that it will start attracting more users to its platform and increase the level of user engagement. This will be important if Twitter is to return to the kind of revenue growth that investors are expecting.
To this end, Twitter has added a number of features to its platform. It recently introduced Highlights for Google (GOOG) (GOOGL) Android users. In describing Highlights, Twitter management said, “It brings you a summary of the best tweets tailored for you via push notification letting you quickly catch up with what’s happening in your world.”
Also, the company wants to remove user consumption barriers on its site. A few months back, Twitter introduced the Recap feature—”Recap brings to the top of your timeline some of the best tweets you missed from accounts you follow while you were away from Twitter.”
A few days ago, Twitter redesigned its homepage to provide a better experience to logged-out users. Logged-out users visiting the homepage can now see a feed of tweets from several popular accounts on the topic of their choice, similar to what they’d see if they were logged-in.
Twitter wants to better monetize its users
By providing a better experience to its users, Twitter aims to better monetize them. It hopes to accomplish this by feeding them relevant ads while they visit. These initiatives should help Twitter get a foothold in the display online advertising market that’s currently dominated by Google.
According to a report from eMarketer, Facebook (FB) and Twitter will continue to gain share in the US digital display market in the near future. As the above chart shows, this increase will come at Google’s expense. Meanwhile, the report expects Twitter will rapidly gain share, up from 3.7% to 5%. Yahoo (YHOO) is supposed to lose a significant share of the market, dropping from 5.5% to 4.6%.
To gain diversified exposure to Facebook, you could invest in the PowerShares QQQ Trust, Series 1 (QQQ). QQQ invests about 3.7% of its holdings in Facebook.
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