Earlier this week, Twitter’s forecast that foretold of the microblogging site’s $1 billion revenue in 2014. This figure remains a mere rumor, but if the latest word on the company’s mobile efforts are true, there may be something to that bullish prediction. Twitter CEO Dick Costolo hinted at Twitter’s successes thus far during The Economist’s “Ideas Economy: Information 2012” event on June 6. Costolo’s response fuels suspicions that just maybe, Twitter has discovered a successful mobile monetization strategy where giants like Facebook and Google have not.
With Facebook’s poor IPO performance, the perception of social as a profitable business is dimming by the day. Sitting today at half the market cap of its opening day, Facebook and its disappointing performance may have sunk valuations for upcoming start-ups and pending IPOs, while affecting investment interests in social networks seeking to generate revenue through advertising. Adding insult to injury, eMarketer had found that 83 percent of Facebook users “rarely or never clicked on Facebook ads or sponsored content.” With Facebook scrambling to unearth a successful mobile revenue strategy, it’s hard to see improved figures translating into their mobile efforts.
Twitter on the other hand, might be just the role model that mobile-based social start-ups need.
Its advertising efforts include the limited release of its self-serving advertising platform for small businesses, which is currently used by select participating businesses during the beta iteration. The company also launched an advertising feature that enables advertisers to specifically target smartphone users.
Today, Twitter hosts over 400 million tweets per day, a 62.5 percent jump from the 250 million tweets per day it handled back in October. Adding to its string of milestones, Costolo revealed that Twitter has more than 140 million active users who log in at least once per month. Much of its success, according to Costolo, has been due to its mobile platform. “We’re borne of mobile,” Costolo said at the event. In fact the company’s mobile ad revenue surpassed its desktop platform revenue. “We have an ad platform that already is inherently suited to mobile, even though we launched our platform on the Web and only started running ads on mobile recently,” Costolo added. “It’s already been the case a couple weeks ago that mobile ad revenue in a day was greater than non-mobile. Mobile revenue is already doing delightfully well.”
Facebook has little time left to figure out its mobile advertising strategy. By 2013, the majority of mobile users will own a smartphone. More specifically by 2016, according to eMarketer, smartphone users will account for 74.1 percent of all mobile phone users (192.4 million owners), a jump from 47.7 percent of smartphone owners (115.8 million owners) in 2012. Smartphone penetration between 2012 and 2016 is projected to increase from 36.6 percent to 58.5 percent of the population, but the rate of adoption will begin to plateau.
When it comes to mobile, Twitter seems to be the only platform with it down. The microblogging platform’s users are more active and engaged on the mobile platform than its desktop counterpart, and according to Costolo, 60 percent of Twitter users are accessing Twitter on iPhones and Android phones.