How will the Twitter IPO affect content marketing?
By the time you read this article, Twitter – the world’s favourite microblogging platform – will be a publicly-traded company. That means anyone quick enough to get in on the limited number of shares available will be able to own a small slice of the very website that exposed us to the true scope of Charlie Sheen’s madness and made “hashtag” a word we all recognise and use.
Of course, the idea of a social media platform conducting an initial public offering (IPO) carries somewhat negative connotations these days. Facebook’s now infamous 2012 IPO was hailed as one of the biggest ever undertaken by a technology company, but the stock price dropped sharply immediately after the flotation.
Twitter has taken extensive steps to avoid the overabundance of hype and the series of technical mishaps that plagued Facebook on launch day nearly 18 months ago. They have kept the details of their IPO relatively under wraps in order to avoid much of the speculation and buzz that Facebook faced (and embraced), and have opted to use the New York Stock Exchange as opposed to Nasdaq, where Facebook listed.
And it looks as though the preparation paid off with Twitter (NYSE: TWTR) attracting plenty of interest from investors. Rather than dropping, its share price surged some 80 per cent during its first day as a public company.
A publically traded SEO tool
To those in the content marketing world, there is another major question mark hovering over the upcoming Twitter IPO. How will this move affect content marketing, search engine optimisation and the way businesses use Twitter to promote themselves?
As a publicly traded company, Twitter will have new obligations to investors that it did not previously have. Despite having an admirable roster of more than 200 million users and a net worth of around $18 billion, Twitter has never made a profit.
Like many social media platforms, Twitter has struggled to find a way to make money without annoying a fickle user base. Increasing mobile ad revenue helped the company generate US$254 million in the first six months of 2013, but that wasn’t enough to avoid a $69 million net loss.
It’s difficult to predict exactly what steps Twitter will take to improve profitability in the near future, but odds are it will continue to look to earn money from businesses, rather than the general public. Could this mean the days of the microblogging site being an essentially free advertising tool are just about over?
Precedents in the social media world
Once again, it’s worth looking towards the Facebook precedent in order to understand how an IPO might affect Twitter and the Twitter user experience. When Facebook first came to prominence, businesses had virtual free-reign over how they could use the website to promote their products and services.
In recent years, however, Facebook has looked to stem the tide by making it more difficult for businesses to advertise via Facebook without coughing up payments. Restrictions have been put in place making it harder for businesses to grow visibility organically.
At the same time, Facebook has become an increasingly crowded marketplace, with more businesses fighting for a share of the spotlight. As a result, paid promotion and advertising on Facebook have grown in popularity, helping the company post a first quarter 2013 revenue of US$1.46 billion – a 38 per cent year-on-year increase.
Businesses can expect Twitter to follow suit, making it harder for them to promote their products on the website without paying for the opportunity. Already Twitter has begun to ramp up promotion of its Promoted Tweet function, and more pay-to-Tweet experiments could well be coming in the near future.
The new Twitter frontier
With the nature of Twitter as an advertising tool set to change, businesses need to take action to ensure they are making the most out of this platform. Fortunately, there are things that you can do right now, and in the future, in order to ensure your company’s Twitter account is ready to survive and thrive in the new Twitter frontier.
Now is the time to begin growing your number of followers and expanding the reach of your Twitter account – before you are required to pay for the privilege. You can do so by actively engaging with the Twitter community, communicating with your existing followers and reaching out to potential users.
On October 29th, the layout of the Twitter timeline was updated to make pictures and videos more immediately viewable – a move that some have suggested is the first step towards maximising Twitter’s potential as an advertising tool. However, your brand can get in on this opportunity early by ensuring it is sharing interesting, original content such an infographics and videos via Twitter.
According to FRANk media, there were approximately 2.5 million Australians actively using Twitter as of last month. At this point in time, that is a captive audience, there for the taking by proactive and innovative businesses. But the window of opportunity is closing, so now is the time to get involved – before this little birdy well and truly takes off.
By Zak Wash