Twitter to Go Public

Scott Lambert

Popular social media site Twitter is about to be floated on the stock market; however, potential investors still have no idea what it is worth. Anxious to avoid the overinflated share prices that notoriously got Facebook into trouble, Twitter is taking advantage of the fact that its annual income is still under $1bn to use the JOBS Act of 2012, which entitles it to keep its official valuation secret until just before the floatation is launched.

All this uncertainty about the site’s financial future is adding to uncertainty about its future as a focal point for social media marketing. The general expectation is that it will grow stronger after going public, but as yet there is no metric by which to measure this. What is known is that over half Twitter's ad revenue for this year is expected to be from mobile device users; as the mobile market grows, this is likely to give it an increasing advantage over the competition.

With 300 million users, Twitter is probably at a better stage in its development cycle for going public than Facebook was with 1billion users; crucially, Twitter still has plenty of room to grow. This means prospective investors can anticipate their shares growing in value, making a purchase more worth their while. A transaction this week suggests that the company is currently valued at around £10.5bn; however, other estimates have put the price as high as $15bn and in total its shares are unlikely to sell for less. This should afford a measure of security for businesses wondering about investing in Twitter-based social media marketing plans.

Another factor that may counter-intuitively work in Twitter’s favor is its comparatively slow rate of growth. Although this may put off some bigger investors, it is also an indicator of stability. Crucially, this growth has been steady and it does not seem to be easily affected by changes elsewhere in the social media marketplace.

With both user and search engine preferences increasingly tipping in favor of subtle advertising that does not distract from the core function of a system, Twitter is looking like a good bet for advertisers and for those set to benefit from their interest. As the public popularity of search engines has waned in recent months, Twitter has continued to build on its advertising potential.

To find out more about how you can take advantage of this and better manage your Twitter advertising, call Xcellimark at 888-318-3950 ext 211 to speak with an internet marketing consultant today.

Topics: Social Media