Last Updated 07 Jul 2020

Twitter Swot Analysis

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Twitter, a website provides online social network and microblog services, is gradually seeping through into every area of life. It was listed as the most important invention in 2009. The same with Facebook who also provide online social network service, more and more people are feeling rely on Twitter, and could not get rid of it. On twitter, we send a real-time mail which is also known as tweets to millions of people around the world within 140 characters.

As users, we could share our latest news and ideas to the followers through website interface, SMS from cell phones and mobile device apps; meanwhile, we also can get the instant information about what is happening among the followings, the country and the world. On the technology aspect, Twitter has always based on open source software from the back-end to the front-end. Nowadays, Twitter has became the top ten most visited websites. Before it was known as “Twitter”, its founders named it “Twttr”.

Twttr’s idea came from Dorsey, one of the cofounders, who expressed to “enable users carrying standard cellular phones to update small groups of people on their current situation by pressing a few buttons and tapping out message. ” At the spring of 2006, Dorsey sent the first tweet, and then, launched “Twttr” through the turmoil of headcount trimming in the same year together with the cofounders, Williams and Stone. Twttr became Twitter in 2007. We could feel the name as the buzzing of the SMS message alters and chips from birds.

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In this year, Twitter began to hit the market and its users kept growing in the next several years contributed from its word-of-mouth promotion. During its growth, the company continued to get venture capital invents. A lot of large companies were interested in Twitter as they thought Twitter has audiences in hands which would be lucrative. However, by 2011, the company still had problems which may bring risks in the future. According to the paper, the company had four issues: 1. The company was still on the way to seek prots.

It was clearly that the company would be eventually pressured by the inventors as they largely relay on venture invention to support the company. Meanwhile, their application was totally free for use, in this case, advertising was almost the only tool to gain revenues. 2. The business model and strategy remain opaque. As mentioned by Ray Valde, Twitter was in a dilemma that they need a “robust revenue model”, while had to diminish perceived value which has a lot of potential value. 3. Did not commercially exploit its large and rapidly growing user base.

As a kind of social media company, who has the audience, who will make money. User was the key factor that will determine Twitter’s fate. 4. The ongoing change in the top management team. The turmoil began at the start-up phase and even had not terminated by 2011. This may become mines for the company. This case write-up will state Twitter’s business problems in detail, and use SWOT analysis to make the company’s situation more clarified. Then, raise solutions and suggestions for the company.

2. Strategic analysis of problem
SWOT analysis

Weaknesses

Very popular and acceptable by a large number of users
Creatively changed the way of messaging
Greater access to capital

Internal organizational turbulence
Did not exploit the user base
Unclear business strategy and no solid
revenue model

Opportunities

Threats

Dominant position in social media industry
Competitors started to emerge A ton of public
Suffer from abandonment of users
A more technologically savvy plantform

Strengths

Very popular and acceptable by a large number of users
Why people would like to use twitter? I will give some factors according to this case:
• easy use
• free use
• allow users to send and receive messages to a mailing list of recipients in real-time
• better than online chat
• strong brand loyalty
• could run on different devices, especially mobile devices Thanks to these advantages, Twitter got 200 million users by March 2011.

Although it was far from Facebook’s users, the number was still amazing and at the leading position among social network websites. The more visitors, the more the site is worth. Just account for the amount of users, we could estimate that the website of Twitter will be extremely valuable.

Creatively changed the policy of messaging

It is hard to say Twitter has a big invention on technology aspect, and to a large extent, it brought about by recon?guring existing technology. However, we cannot deny it is a big revolution and has changed the policy of messaging. Twitter was built on existing technologies like SMS (short message service), IM (instant messaging), and RSS (really simple syndication), then, combined them in a unique way. It is one-to-one association when we are using SMS and IM.

Now, it is one-to-many association which facing to the public, when we are using Twitter. On Twitter, we send 140 characters instant micro-blog, use “@” to mention or replay other users, use “#” to post together the same topics. All these creations changed the way people communicate. Greater access to capital Twitter had attracted plenty of capital since its establishment. For a young company, suf?cient fund and patient inventors could allow them a more space to develop and complete their big idea.

Weaknesses
Internal organizational turbulence

Twitter’s internal contradiction emerged at the initial phase. When Odeo’s team launched Twttr Beta, six employees terminated contracts. Moreover, among the four cofounders (Dorsey, Glass, Williams, Stone), Dorsey and Williams had even acted as CEO; but both of them quitted. And the name of Glass was seldom raised in Twitter’s history. The establishment of Twitter extremely require collaboration, however, people in the founding team have different expectations. Inventors may lose con?dence in them.

Did not exploit the user base In spite of the fact that Twitter’s success rides on the user base. However, according to the paper, Twitter did not commercially exploit it. Or we can say Twitter had no extra energy to do it. The top managers concentrated on how to make their product more advanced and how to attract inventions. They did not notice the user base was the valuable source for them. Actually, they owned the large amount of users and easier than other companies to conduct a survey on them.

Unclear business strategy and no solid revenue model

Twitter has been trying to be different from other closest companies and exploiting which path was likely to take from the beginning. However, the path depended on how the ?rm perceived and de?ned itself. They just claim their blueprint for making the company “as large an impact as possible” instead of setting speci?c business strategy.

What’s more, Twitter still had not built a solid revenue model even through their revenue kept increasing from 2009. As it stands, the company’s revenue was largely relay on advertising and the last was from data licensing. By comparison, Twitter had the similar ad model as Facebook, but facebook was trying to get rid of reliant on ad while Twitter was not able to do it at present.

Opportunities
Dominant position in social media industry

Although the amount of users was lower than Facebook, Twitter still own the large amount of audiences. It was not the ?rst mover in this industry, but the ?rm acted quickly and was already far beyond other similar social media companies. Contributed by its dominant position, more and more people would like to choose Twitter based on the number of other users of this platform, and inventors would focus on the ?rm, then invent on it as they believe the one who owned the audiences would be valuable. A tongue of public

Because of Twitter has the advantage of timeliness, it became a tool to publish news. In 2008, it played as a key tool in the U. S presidential campaign and the attacks in Mumbai, India. From then on, Twitter became an important role in politics. People became more and more believe the platform as they can use it to publish their opinion to the public. It was helpful to strong its social position and brand impact. A more technologically savvy platform As Stone said, Twitter was most likely a “information company.

” In recent years, this platform value which was derived from information-sharing has reached the peak. Twitter has owned two advantages: a large user base and information-sharing platform. These resources could be used to improve revenue. There was no better savvy platform than Twitter to help companies promote services and products with limited budgets. This project was known as “promoted tweets”, launched in 2010. When followers log in Twitter, promoted tweets will appear at the top of the timeline, then advertisers will pay when a user engages.

Threats
Competitors started to emerge

As the industry was lucrative, some companies had started to emerge and attempted to share the cake. Now, it was not just Twitter provided free services, some large and competitive companies like Friendfeed, Identi. ca, Present. ly, and Google were looking at the market. These competitors were not just copy Twitter but offering some new functions that Twitter did not have. If Twitter stop improving their applications, it may be eliminated in the competition.

Suffer from abandonment of users

Once your friends left the social network platform, more and more connected users may leave it. Then, this website will face catastrophe. Now, Twitter was facing the trouble---although they had attracted a lot of users, the abandonment rate up to 40 per cent yet. On contrast, only 7 per cent Facebook users said they may never use Facebook. And Twitter’s active users were far below than Facebook. One data analysis showed that in Jun-10, only 12 millions U. S Twitter active users while the number was 137 millions for Facebook.

3. Solutions and recommendations

Conclusion about Twitter

Twitter entered the market at a right time, and grabbed the larger resource in the industry. It was a big Internet Innovation and changed the way people communicate. However, it was true that Twitter did not do as good as other similar companies like Google, yahoo, and facebook. For example, in 2009, Google earned more than $18 from unique visitor, Facebook earned about $3, but Twitter only got lower than $1. They were still facing challenges and on the way to exploit the best path.

The challenges which were brought by competitors’ expanding The denying and ongoing innovation of Internet will never stop in this age, and its sustainable innovation has brought about a new round of reform of the marketing mode. Twitter cannot just stay stuck in its old mode. In this industry, stagnate means decline. The first challenge was from the companies who imitated Twitter while developed more functions. However, these competitors had precisely pushed forward Twitter and proved microblog had the bright prospects for development. To deal with them,

Twitter had better to enhance its brand loyalty, and form its own core competitiveness. Users would like to choose the one who dominated the industry because they were easy to be impacted by conformity. Moreover, Twitter should be sure to avoid following others, developing the functions what others have. They should keep creating new ideas and act quicker than competitors. Even through competitors’ function was more advanced than Twitter, it did not mean it was an appropriate product for Twitter. Another challenge was from large companies like Facebook and Google.

These companies also wanted to do everything and dominate the industry. They were similar as Twitter, owned a large amount of users, but did not do microblog. Twitter was not safe even though it did the best in microblog. These services were another form of social media that also may grab Twitter’s market. Twitter needs not only to improve its model to attract more users, but also continue digging potential value in other area to expand the ?rm. Exploit more sources of revenue Twitter cannot largely rely on venture capital invention and advertising any more.

It needs to ?nd out another way to obtain fund. The ?rst option was to imitate Google and Apple, provide more services and develop more products to increase revenue. Another option was to imitate Facebook, launch IPO. Or it can do both. I think launch IPO will be better because Twitter did not have the technology support as strong as Google and Apple. And Twitter’s revenue model was already unclear now, if it provides more products, the model may become more confused. What’s more, IPO is a better choice for long term development.

Increase the R&D activities It is not only the revenue model needs R&D, but also the new application innovation needs R&D. When going to Twitter. com, we will basically see the same thing that the company did years ago. They did not keep working on anything that cool. Meanwhile, they did not reveal any details about the R&D plan and result. Conducting R&D could help Twitter to improve their products and services, which was necessary for a technology company. Twitter website was built on open source software. It was helpful to develop new applications. Furthermore, in order to keep an eagle eye on the competitors and customers, R&D should not be ignored by Twitter.

Promote overseas market

It was clear that Twitter owned a large number of overseas users, but had not figure out an effect profit in other countries. “Promote the tweets” won a big market in the U.S, similarly, the foreign market had a large profit that could be exploited. But it will be a big project that need marketing research and detailed plan before they decide to move in a foreign market.

Twitter Swot Analysis essay

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