Photo: BI Intelligence
We have been bullish on Twitter’s business since the beginning, and evidence is starting to pile up that Twitter is quietly building a formidable business.But there is a new element which is coming into play: mobile.
As Henry Blodget recently reported, plenty of Twitter advertisers are happy with the results of the ads — particularly mobile ads.
Also, CEO Dick Costolo told reporters this month that its mobile revenue exceeds its revenue from desktop ads on some days this year.
Twitter can build a great mobile ad business for two reasons, one which is intuitive and one which is less so:
- Twitter is a mobile-first product. Over half of Twitter’s usage is mobile according to our research (see chart), and Twitter is a great mobile product. The fact that Twitter’s product is great to use on mobile (unlike, say, Facebook) ensures it has the base to build a mobile ad business.
- Twitter has the same ads on mobile and desktop. This is less intuitive, but very important. It’s important because mobile ads, particularly display ads, don’t have the same performance on mobile as they do on the desktop. This shouldn’t be true of Twitter’s ads, which are mostly “tweets” that Twitter promotes to users. This means that Twitter’s ad system is easier for advertisers, since they can have the same creative and format for mobile and desktop. More important, Twitter’s mobile ads should perform well, so the company can sell them as a premium relative to other mobile ads.
Therefore, the anecdote of the advertiser very happy with his mobile ads should be more than an anecdote. Twitter’s product, and its ad product, is extremely well-positioned to build a great mobile business. We remain as bullish on Twitter’s business as ever.
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