Twitter Study by faberNovel & l'Atelier

@all studying the #Twitter phenomenon

December 2009

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..…….

Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 2

Comment this study

To comment the study, tag your messages with:
#Twitterstudy

To watch the live presentation, go to:
talk.fabernovel.com

..…….


Summary

• What is Twitter?

• What do people do with Twitter?

• Why did Twitter grow so fast?

• What business model for Twitter?

• Who could challenge Twitter?

• Conclusion

..…….


Meet the tweet

A tweet is a text-based message up to 140 characters
automatically delivered to the author’s followers.

..…….


You follow people

you your friend

Following someone means you get their tweets
as soon as they post them.

..…….


And people follow you

a huge fan of yours

you
your friend

Your followers get your tweets in real-time :
you become a media.
..…….


By default, everything is public on Twitter

Unlike Facebook, you usually don’t have to know
someone to have a full access to their tweets.
Twitter is a huge base of public data.
..…….


Twitter interface : simple and elegant

What’s happening for you?
Write your tweet here

you

What’s happening for
your followers?
You can read that here

..…….


To define what Twitter is, let’s see what Twitter isn’t

Twitter is not a: Is Twitter a

blog The number of characters of a post is unlimited. One
tweet is limited to 140 prints. # Micro-blogging service?
Twitter is not a blog

sms You can send both a tweet an a SMS from your
mobile phone. But the tweet is posted on the Internet, and # Public SMS platform?
is public.
Twitter is not a SMS

social network In a social network, your profile is private.
In Twitter, everybody can follow you, you can follow # Public social network?
everybody, and your profile is public.
Twitter is not a social network

chat A chat conversation is private, a Twitter
conversation is public # Public chat?
Twitter is not a chat

Twitter is the SMS of internet era.
..…….

Twitter Study • December 09 • faberNovel / Atelier BNP - Paribas • 10

Summary






• Conclusion

..…….


Reputation: Twitter in France

Dear French Internet user, do you know...

Yes : 60%

Yes : 4%

Yes : 1%

..…….
Source : pour L’Atelier Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 12


Incredible growth !

%
%

%

%

%

%

%

..…….

Usages: Twitter in France

Percentage of Twitter members within our «aware
internet users» ?

9%

..…….


Who knows Twitter in France?

..…….


Who is the French Twitter user ?

..…….


What publication client/device do you use ?
30% 39%
Twitter.com PC / Mac
client

31%
Smartphone client

Source : Poll launched by L’Atelier ..…….
on twtpoll.com – november 2009


Tweeting, yes, but for what ideal purposes ?

65% Creating and sharing a friend network

Having good deals & coupons
69%

40% Recruiting an employee

..…….


Tweeting, yes, but for what real purposes ?

7% 2%
13%

8% 51%

14% 3%

Source : Poll launched by L’Atelier ..…….
on twtpoll.com – november 2009


Useless? < Twitter < Useful?

63% 73%

French Internet users French Twitter members

..…….

Who tweets?
Individuals

Typical user I’m 31 years old, tech-savvy. And I do a lot of
things with my phone.
But 55% of users haven’t posted any tweet on their account!

Star Ashton Kutcher (aplusk) was the first Twitter account
to reach 1 M followers
And he chats with Demi Moore...

Blogger Pete Cashmore (mashable) has 1 M followers
Mashable is a famous blog about social media

Politician Nathalie Kosciusko-Morizet frequently uses
Twitter
Minister of Forward Planning, Assessment of Public Policies and
Development of the Digital Economy in the French government,

..…….


Who tweets?
Companies & public institutions

Media CNN and the New York Times are among the first
20 most followed Twitter accounts.
But...Ashton Kutcher has more followers than CNN!

High-tech companies Google tweets to inform, Dell
tweets to sell.

Other companies The majority of Fortune 100 companies
don’t really get Twitter.
50% of the Twitter accounts of Fortune 100 companies have less than 500
followers

Public Insitutions The White House, l’Elysée
communicate via Twitter.
L’Elysée plans to tweet during Copenhagen Climate Conference

Twitter users’ are still a minority of tech-savvy people, companies and institutions
who have prominent communication needs
..…….


What does the average user do with Twitter?

Follow and discuss news or Strategic Intelligence
• Users follow mainly people who have the same kind of
live events business
• 41% of URLs tweeted are news.
• A majority of users use Twitter as a news aggregator.

Gossip
• Asthon Kutcher, Britney Spears and Ellen DeGeneres Compared to other community-
are the 3 most followed Twitter accounts
driven websites (facebook,
MySpace, etc.)
Twitter is more business and
gossip oriented.

..…….


What do bloggers do with Twitter?

They increase the ranking of They do “link journalism”
their blogs Bloggers use Twitter to analyze events in real time
Bloggers use Twitter to rapidly pinpoint interesting links
• Twitter has become one of the main sources of
traffic (eg : 10% of TechCrunch traffic ).
• Being on Twitter increases your Google ranking.

They carry on a continuous
relationship with their readers Twitter is a way, for bloggers,
•Followers get directly informed when a new post / a
new tweet is published. to explore new editorial areas,
mainly “link journalism” & real
time analysis

..…….


How do companies use Twitter?

They monitor in real-time They sell and market their
competitors, reputation and products
New sales channel (Dell)
improve business intelligence
New marketing channel (Pizza Hut)

To evaluate consumer
satisfaction and take into Twitter is an efficient marketing
account their feedback tool, both for companies and
•Crowd sourcing innovation to users (Zakos) customers:
•Conducting surveys on existing products (GM)
•Gathering feedback on experimental products (Dunkin good knowledge of customers
Donuts)
•Customer service (@MicrosoftHelps ) & free marketing opt-in channel

..…….


How do public institutions use Twitter?

Emergencies Police
Eg: @SF-311 for emergencies in SF Eg: West Midlands Police (UK)

Governments
Eg : Downing Street (UK)
Twitter is an efficient
communication and reporting
tool for public institutions

..…….


Who is the most followed on Twitter?

Ashton Kutcher
3.9M

CNN 2.8M

Barack Obama
2.7M

Dell Outlet
1.4M

TechCrunch
1.1M

Number of
Majority
followers of
accounts
< 50

Twitter is much more a one-way communication channel ..…….
than a social media network

Twitter usage is similar to wikipedia

90% of the content is 90% of the content is
produced by 15% of users produced by 10% of users

• More unidirectionnal than • A community lead by
peer to peer communication hyperactive users
• Few contributors, many • Few actual tweople
readers • The more followers you
have, the more you tweet

A typical power law distribution applies to Twitter content creation
..…….


Summary






• Conclusion

..…….


What is the history of Twitter?

2006 2007 2008 2009
launch fame development success

Twitter raises $22M
Twitter won the “blog and opens its API, Twitter raises $35M
Twitter is publicly price” at SXSW developers create and has a growth of
launched. Interactive* Twitter applications. 1,300% in a year**

Twitter’s growth is amazing:
in 2009, Twitter is the fastest community driven growing-site.
..…….
* South by Southwest Interactive is one of the best festival in the world for creative technologies
** Feb 08- Feb 09 Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 30

Twitter benefited from the rise of mobile Internet

• The number of US mobile Internet users grew by 170% in two years*
• The rise of mobile Internet users was a tremendous accelerator for Twitter
• The 140-char format is adapted to mobile situations
• People were already used to SMS
• People can also tweet and be followed by using SMS.

..…….
* Feb 07- Feb 09 (Nielsen)

Thanks to an early adoption by celebrities and media,
Twitter reached a big audience rapidly

Celebrities
Most-followed accounts “ever” :

“Twitter star system” and verified accounts have spurred its adoption by a non-geeky audience

Media

• Media coverage on Twitter before
other major medias
• Ideal tool to cover live event in
real time
• difficult to censor

Twitter became THE real time news channel ..…….


As a generic platform, Twitter’s growth has been
user-driven

API (opened in 2008)

developers

New uses: #, @, RT, etc.

New applications

users
New functions : RT, lists, etc.

..…….


A strong community of developers

It is very difficult to compete with Twitter, because a new-comer has to create
a more powerful network than Twitter’s one.
..…….
Picture by Thenextweb.Com

What are the prospects for Twitter?

By the end of 2009 By the end of 2013

25 million users 1 billion users

Q3 2009 : $400 000 $1.54 billion in revenue,
Q4 2009 : $4 000 000 $111 million in net earnings
How?
Whereas Twitter grows very fast,
its business model remains unpredictable…
..…….
Source: TechCrunch, July 09 Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 35

Summary






• Conclusion

..…….


Make the bird lay golden eggs: hypothesis for
Twitter’s business model

Market research
Companies pay to do market research on Couponing and/or SMS advertising
Twitter, Twitter selects the panels and • Ads and/or coupons to opt-in Twitter accounts.
analyses the results • Prospects selected by geolocation or by Twitter

Contextual ads (Google Adwords like)
Freemium Contextual ads on Twitter search and during
You have to pay to get “pro” access to Twitter tweeting
..…….


When should Twitter begin to monetize?
1) Now

Advantages Risks

Twitter has high and
Twitter would pay all
short-term financial
the testing costs to
expectations, Twitter
find the appropriate
should monetize fast
business model
to keep VC happy.

Twitter would acquire Twitter could engage
a real business in a wrong business
experience. model.

..…….


When should Twitter begin to monetize?
2) Later

Advantages Risks

Twitter has such a big community, that it could start its monetization by testing various
business models at a small-scale.
..…….


Summary

What is Twitter?

What do people do with Twitter?

Why did Twitter grow so fast?

What business model for Twitter?

Who could challenge Twitter?

Conclusion

..…….


..…….


facebook?
The ox that wants to be the frog

facebook is a giant compared to Twitter

350M users approx 20M users

facebook looks more and more like Twitter since the acquisition of friendfeed :
facebook wants to go public

+ = ?
..…….


facebook?
Twitter competes with facebook on contextual ads, real-time search and CRM

Personal activities Business purposes
Users are more reluctant to have ads on facebook 20M on Twitter.
than users
Tweets have a larger public than facebook updates’.

Private real-time information Public real-time information
More information is available on Twitter than on facebook, making
real-time search more accurate.

Unless facebook succeeds in becoming public, Twitter has a better position.
..…….


..…….


Google?
Twitter & Google cooperate in the field of real time search

• Old news • Real time news
• Steady content • Dynamic content
• The web’s long term • The web’s short term
memory memory 20M users
• Page rank • Retweet rank ?

Need Twitter’s real time Need Google search
content technology & traffic
Need access to Twitter
firehose to rank tweets
In October 2009, they reached an agreement to include
Twitter content in Google search results ..…….


Google?
pushes initiatives towards a fragmented real-time content market...

• Google Wave could become a universal real-time conversation
platform

• Google will index the whole real-time web thanks to PubSubHubbub, a real-
time protocol

• In December 2009 Google struck formal partnerships with Facebook,
mySpace and Twitter to index their live updates

=> The new version of the Google search engine, Caffeine, will emphasize
real-time search results including tweets, blog items, news articles and social
networking updates

...and a monopolistic real-time search market
..…….


..…….


Spam?
A threat for Twitter

Spammers use Twitter for two purposes :

Tweetomercials Cons

Though Twitter is making progress on blocking spam (they introduced a
“report spam” function on October), spam could reflect as badly on Twitter as
it reflected on Myspace.
..…….


Other micro-blogging services ?

• open source, no character limitation.
• belongs to Google
=> Google didn’t build a large enough community to compete with
Twitter

•“Niche” market : enterprise microblogging
• Has a business model
• internal company information
=> Popular but doesn’t directly compete with Twitter

For the time being, no other micro blogging platform is in position to
compete with Twitter : Twitter rules them all!
..…….


Summary






• Conclusion

..…….


Worst case scenario:
Twitter may be asphyxiated by competition on all of its potential markets

Real-time Social Information Specialized
protocol Network analysis Business tool

New protocols may All social networks As real-time streams Companies duplicate
enable broadcasting foster real-time grow from various Twitter interface but
quicker, free and status broadcasting, sources, the real specialize efficiently
less proprietary real- and compete with business model may on vertical markets
time content Twitter on features belong to companies
and privacy able to filter the
information.

Eg : PubsHubbub Eg : Facebook as a Eg : Google Caffeine Eg : Yammer creates
protocol as a push- Twitter based on as a competitor on a B2B Twitter with
notification RSS may real-life social real-time search specific distribution,
offer real-time network features and
broadcast to all business model

By willing to maintain a wide-open “pulse of the world”, Twitter may be
overwhelmed by businesses grounded in reality
..…….


Best case scenario:
Twitter may become....
Real-time Social Information Specialized
protocol Network analysis Business tool

The most trusted The first mode of Robust platform for Ensure customer
source for real-time communication analyzing massive satisfaction and
data between individuals amounts of real time loyalty, while
data and behavior providing targeted,
Geolocation Friend geolocalized ads
Real time
Services updates
analytics CRM
Media Contact mgmt Human E-commerce
behavior
Celebrities Social Search Real time
Data
aggregation feedback

$$ $ $$ $$$

…a standard of real-time information, data, and communication
between individuals and businesses. Twitter can be the leading
communication platform for commerce and people.
..…….


The Innovation Agency

faberNovel, founded in 2003, specializes in designing and realizing innovative
projects.
Based in Paris and San Francisco, faberNovel builds on emerging technologies,
methodologies or practices to create new products.

faberNovel’s team combines the necessary talents and passion to turn their clients’
wishes into market realities: Idea > concept > prototype > product > success!

References: Avis, Groupe Suez, JCDecaux, L’Oréal, Orange, Pages Jaunes, RATP,
SFR, SNCF, Vinci, etc.

See our strategic studies on:
http://www.fabernovel.com/en/analyze/realisation/strategic-studies-and-surveys

..…….


Tracking and sharing innovation : since its beginning in 1978 in Paris, L’Atelier has
been helping executive committee in such fields as innovation and internet strategy.

L'Atelier teams have been actively involved in technology for years, acquiring solid
expertise and an impressive network of contacts. Strategic and operational insights
from L'Atelier experts have earned a reputation for both vision and provocative
thinking. A respected observer of developments in France, L’Atelier opened a San
Francisco office in 2006 and one in Shanghai in 2007.

http://www.atelier.fr | http://www.atelier-us.com | http://asie.atelier.fr

..…….


17, rue du fbg du Temple 75010 Paris 16 rue de Hanovre 75002 Paris
Tél. : +33 1 42 72 20 04 Tél. : +33 1 43 16 92 00
Fax. : +33 1 42 72 20 03 Fax. : +33 1 43 16 91 00
www.fabernovel.com http://www.atelier.fr/

Contact presse: Contact presse Rumeur Publique:
Sabrina Distinguin Thomas Boullonnois
sabrina.distinguin@fabernovel.com thomas@rumeurpublique.fr

..…….


Twitter Study by faberNovel & l'Atelier

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