I should sell my Twitter shares!
Not long after Twitter (NYSE:TWTR) went IPO, I bought a bunch of shares to see what would happen with this company. It cost me around 35€ per share including the transaction fees which is 38.50 USD equivalent. So as of today I potentially lost more than 50% of the investment I made.
Lately, I have been thinking of keeping the shares and wait for the right moment to sell, assuming someone like Google/Alphabet or LinkedIn or Salesforce would propose a decent markup to buy Twitter and allow me to recover part of my losses.
However after the latest rumors developped in the market, it seems that nobody is really interested in the micro-blogging website and some analysts now predict that the share will keep going down until it becomes a penny stock.
The potential I saw when I bought Twitter shares
When I bought the shares, Twitter was the hype and I could see many potential applications of this extra simple concept of broadcasting 140 messages to the world with some #hashtag keywords to sort the content out:
- Interactions on live events. TV shows would use #hashtags to receive customer questions or feedback live during the program, comments could be put in a feed on the TV screen or read outloud by the presenter.
- Exclusive information for major events. Whether it is an accident or any important news, Twitter would often become a primary source of information. For instance for the 2012 French Presidential election, poll estimates would be easily found on Twitter (#radiolondres) while any other media would not be allowed to publish anything.
- Customer Services announcements. Twitter being used by major brands to inform its customers would create from time to time some positive buzz when used appropriately, showing to the public how well customer are treated.
I could see an interesting potential for advertising and promoting brands, people, news with a very simple and broadcast communication concept to the entire world.
The ugly truth and what went wrong
I have now a theory in what went wrong:
The more social media develop, the more garbage we find in them – or in other words – There is a direct inverse correlation between the level of reach one user has in a social media and the quality of the content which will be shared.
The more people you reach on Facebook, the more careful you become when posting something. When registering, you will start by adding your family and close friends, whom you trust and share personal stuff with. Then you start to expand you network adding ex school-mates from primary school, acquaintances and worse, colleagues or bosses from work.
As you are reaching too many different types of people, you have to start adapting the content of your posts to this mixed audience, making it either fake (we all know real life is not posted on Facebook) or boring (posting information which will acceptable for anyone of the audience):
- no pictures of you drunk at a party which will make your grandmother angry,
- no picture of your weekend holiday when you were had a late report due for your boss,
- no personal opinions which could create an endless debate where nobody agrees, and of course,
- a lot of acceptable videos of cats, photos of babies, 1 like = 1 pray and 1 share = cure cancer, play with me on clash of clans, in between ads and sponsored posts…
Worse, when posting on Twitter, people feel somewhat important. Suddently their thoughts are not just shared with their friends but broadcast to the entire face of the universe, suddenly all their opinion matter and should be shared with the public, creating an avalanche of junk messages of 140 characters flooding the little useful information left.
Even LinkedIn, which is a specialized social media for business purposes, so where we could expect the content to be of better quality, starts to see a lot of junk invading its news feed:
- “Solve this if you are a genius: 1+1=?” — good lord I’m tired of those stupid equations,
- I’m creating a WhatsApp group for experts… share your number — yeah, right…,
- Deep motivational quotes from Steeve Jobs — don’t care, and seen it 100 times,
- This fruit can cure cancer — yeah right…
(These are actual examples I could find just today on my LinkedIn feed !).
Businesses don’t want their communications to be mixed up with torrent of junk and bad buzz. Even their own communications can be turned into bad buzz with a massive multiplication effect with internet trolls. See for example this top 14 funniest hashtags in 2015, half of them are bad buzz:
|Ann Coulter vs. Raven||.|
What is the way out of this?
The survival game for social networks is to find the right balance between having a massive user base and not having too many connections to exchange stuff with.
I believe the Ecosystem of massive social media is dying and will be replaced by private messaging applications.
Google tried to create private circles with Google Plus but it was too complicated and geeky to be scaled to everyone.
Facebook has a strategy to push messenger and make it a major point of its strategy with VoIP, Chatbots, AI and marketing tools to monetize the base.
All chat applications can now offer private discussion groups where people can share more personal information and pictures making the messages more interesting to read.
In the graph below, I believe that the services on the right side will have a hard time surviving in the years to come.
What do you think?