Twitter’s (NYSE: TWTR) share price dropped nearly 4% yesterday despite the company announcing some pretty exciting new e-commerce features as part of its wider ambition to double revenue and users by 2023.
Twitter’s e-commerce play
E-commerce is booming right now and there’s been an expectation that eventually every product you see on social media will soon be ‘shoppable’ within a few clicks. Now Twitter wants to get in on the trend with a move that will surely increase business engagement on the platform while driving revenue. Twitter is aware of the potential it holds in e-commerce as the app currently boasts 192 million daily active users which can be turned into potential buyers. Twitter stated:
“We know people come to Twitter to interact with brands and discuss their favorite products,” adding, “Imagine easily discovering, and quickly purchasing a new skincare product or trendy sneaker from a brand you follow with only a few clicks.”
Is the feature live yet?
Twitter confirmed that it’s testing out various new e-commerce additions, including a way to display tweets that can link to product pages. The first feature is a new Twitter card for e-commerce that can add a ‘Shop’ call-to-action button that links through to a transaction page. The ‘Shop’ button is not the last of it though as Twitter also confirmed that it’s testing various other e-commerce tools which will bring a host of opportunities for sellers. CEO Jack Dorsey warned Twitter shareholders that while the company was excited about its new venture into e-commerce, plans are still in the very early stages.
Twitter’s Revenue Product Lead Bruce Falck noted:
“On eCommerce, we get a lot of questions around where we’re at and what the plans are, and why taking so long. Sequencing is really important, and we really believe firmly that getting the performance ads business right, starting with MAP, but then moving on to clicks and conversions, is going to be critical as a prerequisite to eCommerce.”
The mention of MAP refers to the company’s rebuilding of its Mobile Application Promotion (MAP) system after identifying significant issues in 2019. Twitter has since rebuilt its MAP system as this is a key focus point for the company to perfect before launching into e-commerce.
Twitter’s new ad features are part of the company’s larger plan to become a creator platform and bring in more revenue. The microblogging site recently unveiled plans for a “Super Follow” subscription which content creators will be able to offer their followers subscriber-only additions like newsletters, exclusive content, a supporter badge, deals, and discounts. This new shop format will give creators the opportunity to link products to their tweets, allowing their fans to buy merchandise easier.
The growing trend of shopping on socials
It’s easy to see why Twitter is exploring the world of online shopping, with Facebook, Instagram, Snapchat, TikTok, and Pinterest all developing their own e-commerce tools. There has also been a shift to using video-based shopping on socials recently which might be another avenue for Twitter to explore. For example, Shopify partnered with TikTok on a social e-commerce project last fall and Walmart ran a live-streamed shopping event on TikTok over the Christmas break. Twitter could easily adapt video tools for sellers using its platform as the company has all of the features for videos and live content. Using video for online shopping might be a good way to push its e-commerce across its platforms.
Twitter received some backlash in January after it permanently banned former President Donald Trump from its platform. However, since then the stock has rallied over 30% and is up more than 77% in the last six months. It seems Dorsey has shown shareholders just how serious he is about growing the company.
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Content Writer at MyWallSt
Nicole's favorite stock is Etsy because she loves its original and handmade items. She believes people are going to stop buying mass-produced items and start purchasing ‘one of a kind’ fashions and furnishings. In a world of sameness, Etsy has the advantage.