Twitter – Questions About Growth & Management – 12 November 2020

Twitter is a platform that people have tried to define many times over the years. How would you describe Twitter at this point, having played a key role at the company?

How would you describe Twitter’s key features and evolution as a consumer platform? What are your thoughts on claims that it hasn’t really changed since its 2013 IPO?

It’s been an iterative process – another addition has been the ability to connect and continue tweets in a conversation – but as you indicated, these are hardly substantial UX [user experience] changes. Usability was a big question around Twitter when it went public, with concerns around consumers joining for a variety of reasons and then not knowing what to do. Do you think Twitter has succeeded in improving usability and overall UX since 2013, having noted the introduction of Topics as a way to immerse users?

To what extent has Twitter lost market share and mind share in live events? Their role and value was a major focus for Twitter 1-2 years ago. This has been notably de-emphasised – largely due to the pandemic perhaps – but might other factors have informed this pull-back? Instagram and other social media platforms have live offerings. Twitter historically pushed to partner with big brands and sports leagues to get content onto the site, but could these entities not just create these virtual events directly without partnering with Twitter?

You alluded to advertising products – Twitter is somewhat limited here relative to other social media platforms. Do you think broadening the means to engage with users for advertising and marketing purposes is a major focus for the company? It currently centres on Promoted products, including Promoted Tweets, Promoted Accounts and Promoted Trends.

What are your thoughts on Twitter’s focus and mixed results around DR [direct response] advertising? DR has received significant attention in the US and the west since the onset of coronavirus. Twitter seems to lag competitors in embracing and implementing DR, which might be surprising – the platform’s immediacy should lend itself well to engaging customers in this way.

You cited users being overwhelmed by digital overload amid 2020’s increased online activity, but DR seems to have been a standout for other social media platforms. Do you think Twitter is struggling here due to a structural issue, or is this something the company could improve upon?

How have industry-wide competitive dynamics been impacted by the massive shifts throughout 2020, with more people using social media for longer periods of time?

What are your thoughts on Twitter’s growth opportunity for mDAU [monetisable daily active usage/users]? Many analysts are questioning whether Twitter’s growth here has peaked – the company posted limited QoQ growth in mDAU for Q3 2020. Would you say there are fewer opportunities to gain users following the pull forward in strong user growth you referenced? Do you expect increased churn and challenges to growth now the US presidential election campaign is over, and if coronavirus has less impact in 2021?

Twitter had around 187 million mDAU in Q3 2020, while Facebook had 1.82 billion DAU – I think mDAU and DAU here are perceived as comparable, which implies a lot of headroom. That said, this opportunity has existed over the last decade, and it seems Twitter is now perceived as more of a niche product due to these audience discrepancies. What would enable Twitter to reach more than a fraction of Facebook’s audience?

How have social media platforms positioned themselves and performed amid the increased user engagement in 2020? It seems Twitter has taken a step back, while other platforms have stepped forward. TikTok has gained a lot of traction, even amid its uncertain future in the US. Instagram seems to be chugging along, and LinkedIn seems to be much more focused, ironically, on certain content types including video.

Is it likely that people are being deterred by the unsettling news flow on Twitter – coronavirus, elections, the economy and so on? You touched on Snap and Snapchat, which seem to have had a good year, as well as Pinterest. To what extent do you think people want to use the more recreational social media platforms?

Do you think the possibility of President Trump de-emphasising Twitter – or even being banned from the platform – poses a key risk to the company? In 2016, it was perceived as a positive catalyst for a US president to be using Twitter as a primary communication tool. Is it now a notable risk that he could leave?

There are numerous ways Twitter has grown and can continue to grow – we’ve discussed mDAU, ARPU [average revenue per user], ad loads and advertising pricing. How would you rank those four factors by their importance to Twitter’s future growth?

How could Twitter improve its monetisation and ARPU? This has been a key concern levied at Twitter in recent years, rather than its potential for user growth. Facebook has advantages in targeting data and pricing headroom, while Twitter has been criticised for its investment and execution in advertising technology.

Twitter has been public about contemplating a subscription offering, adding new features and functionality for users willing to pay. Do you think it is likely to implement that over the next year or so?

Twitter’s historically active M&A strategy has become more conservative over the past year, perhaps due to the activist campaign launched in Q1 2020. The company has USD 8bn in short-term investments and only USD 4bn-4.5bn in debt, so it can be relatively aggressive in this regard. Which specific areas might it make sense for Twitter to focus on?

Do you think Jack Dorsey can continue being CEO of Twitter and Square? I referenced the activist campaign, which clearly indicated management was being considered in the context of the stake being taken and the actions being pushed for. I’ve envisaged the possibility of him shifting to an executive chairman role at Twitter, and someone else being installed as CEO. How do you expect his involvement to evolve?

What do you think is Twitter’s biggest risk and its biggest opportunity?