Sunday Stuy: It’s Not Twilight for Twitter

One couldn’t help but be amused by the myopic view of those analysts who downgraded Twitter late last year.  The drop in Twitter shares the last few days of 2013 shows just how unimaginative stock analysts can be.

As they evaluate Twitter in its current iteration, its as if the analysts had looked at the market for personal computers in 1982 and said, “The IBM PC and VisiCalc will dominate the market for business computers and they will be installed on the desks of senior executive managers.”  We all know that happened – for about a year.

Then, in the next decade, the market for computers exploded and fortunes were made.  So much for the “analysts” view.

Twitter holds the same kind of promise.

The “#hashtag” subject identifiers that allow today’s Twitter users to categorize subjects into a single feed is primitive; akin to an IBM PC computer with a monochrome monitor without an internet connection. It does what it does and does it reasonably well, but like the old VisiCalc spreadsheet program (the precurson to today’s Excel), it has its limitations.

For investors, Twitter’s value isn’t in what it is, but in what it can become – much like what computers came to be from the early 1980’s to today.

So, let’s apply some imagination:

What if Twitter had a dashboard that allowed you to apply a filter to topics of your interests: your sports (or sports teams, sports stars, sports scores, etc.), business (or marketing, investing, finance, accounting, retail, professional services, companies, etc.) politics (or politicians, parties, elections, Congress, state legislatures, counties and cities, etc.) food (or recipes, restaurants, bars, dieting, etc.) fashion (or men’s, women’s, and children’s fashions; high-fashion, discount, designer, etc.) your neighborhood (by your zip code, your city, your state, your Congressional district, street or block) automobiles (new, used, auto servicing, technology) or electronics (TVs, game systems, computers, software, telephones, etc.)?

What if the dashboard allowed you to choose two or more of those options like “sports AND restaurants” or “politicians AND your Congressional district” or “Men’s fashions AND your city” or “men’s fashions AND discount AND sports team”?

Now, let’s imagine that after you have applied all those multiple filters to find, say, a sports-themed restaurant that highlights your favorite team in the city where you have business that serves dry-aged prime ribs.  Your customized Twitter feed has found you the ideal restaurant, but you decide that you would also like chocolate cheese cake for dessert.  What if Twitter allowed you type in a random word or words to further refine your filter (“OR chocolate cheese cake”, so that you would learn if the restaurant had chocolate cheesecake or you would had to go elsewhere for dessert )?

All this filtering is, of course, simple Boolean Algebra, well known (though often not by name) to more skilled Google searchers or to users of Lexis or Nexis legal and news databases.

The technology to radically transform Twitter from a hodgepodge of hard news on-scene reporting (where it has been most valuable) from the random musings of people you don’t know or care about (“Going for coffee with Janey”) already exists on other platforms.  It remains to be seen whether Twitter would incorporate it to their systems.

Its merely a matter of time – and vision — to see whether Twitter will effect a makeover to serve as a highly targeted tool for up to the minute information from other users on topics that interest you. If it does, and that needs to be seen,  it will become a powerful niche marketing or “micro-targeting” tool for an increasingly diverse consumer marketplace where every advertising dollar has to be skillfully applied, especially by small and medium sized businesses. Advertisers tend to pay well for  such placements.

 

 

J.G. Collins

DISCLOSURES:

HOLDS OR FAMILY HOLDS:  No. SHORT: No. OPTION POSITIONS: None  EMPLOYED BY OR FEE FROM: No.

This blog post contains forward-looking and speculative statements that  may not come to be realized.  You should consult your personal investment advisor or other professional before acting on any stock advice, whether here or elsewhere. The author is not a registered investment advisor and is commenting based upon his personal use of the product (Twitter).

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