Twitter IPO- a catalyst to change

Twitter is one of those social media giants that is growing at a steady pace and will continue to bring laurels in its name in the near future as well. Twitter’s market is huge, being a social media giant it is supposed to enjoy a good status and earn handsome revenues. But as it seems that’s not the case. Twitter still is in a developing stage although it has about 200 million active users.

Yes, it is true that a website is as successful as the new customer friendly measures it takes in order to ensure a better revenue generation process. It has made its shares public. The Twitter Initial Public Offerings can be easily referred as a strong catalyst for change which may pose threats as well as opportunities for the website as a whole.

If on one hand the transparency between users and the authorities will increase it will also become difficult for Twitter to provide all its public shareholders marginal gains in the present day situations.

To begin talking to big-money investors about its potential stock sale, the website first needs to build a strong revenue generating structure. If you understand the level of returns that Twitter has to make you will realise that the company’s business is not that large . Consisting of around 200 millions active users, its traffic and advertisements are paltry in front of Facebook and the revenue generated at the latter’s end.

Twitter has undoubtedly taken a bold step forward and has tried to increase its impact, maintain its user base and also involve the public in its financial considerations. Once it goes public Twitter will have no choice but to strive to maximise shareholder return and strike a balance between the revenue earned and the dividends paid. More ads on Twitter means more money for Twitter, which makes shareholders happy. But more ads on Twitter will make users less happy, which means fewer users. Fewer users mean lower ad rates, which makes shareholders unhappy — a vicious cycle.

The company will have to yield excellent results in terms of customer approach, user friendly changes, arithmetical progression of advertisements and a better interface such that it is able to fulfil the shareholder’s expectations and keep them happy.

All we can do is sit back and see what happens next, meanwhile, ‘All the best Twitter’!!

via SocialAppsHQ Blog http://www.socialappshq.com/blog/2013/09/19/twitter-ipo-a-catalyst-to-change/