Micro blogging site, Twitter Inc. TWTR said that it is experimenting with a new way to display tweets, sending shares up nearly 3% yesterday.
As per The Wall Street Journal, Twitter is testing an “algorithmic-driven news feed” for a small user base that will sort tweets as per relevance rather than the traditional reverse chronological order. The change is in sync with CEO Jack Dorsey’s promise of bringing big bold changes for the product.
Dorsey, after being appointed full time CEO in October, has been trying to simplify the Twitter experience in the face of decelerating user growth.
He had addressed the timeline issue in the second quarter earnings conference call as the interim CEO. “You will see us continue to question our reverse chronological timeline and all of the work it takes to build one by finding and following accounts through experiences like why you are away and Project Lightning which launches this fall. Our goal is to show more meaningful tweets and conversations faster, whether that’s logged in or out of Twitter. It’s been awesome to use these new experiences daily and I believe we should strike the right balance of recency and relevance in a way that feels really great that truly show the power of Twitter immediately.”
However, Twitterati is not pleased with the change. Alleging imitation of Facebook Inc.’s FB timeline feature, many argued that the reverse timeline order does not need to be changed. It makes sense for Twitter, which is inherently a “real time news and communication platform.”
On the other hand, some analysts observe that sorting tweets as per relevance might be a good idea to deal with users’ concerns of finding important tweets quickly while they are away for some time. In the chronological way of display, it would be time consuming to filter the important tweets. The company has already experimented with this idea through its “While You Were Away” feature. The feature, launched in January, helps users to find important tweets by posting relevant tweets first. It has gained mixed response from users.
Last month, Twitter swapped the “favorites” button for a “likes” button to make the service easy to use. The company replaced its star icon that stands for favorites to a bright red heart shaped button to represent likes. The move appeared to be similar to other social media services like Instagram and Facebook and was met with severe criticism.
Twitter under its re-elected CEO Dorsey has been trying new means to increase user growth rate and engagement levels. Twitter’s sluggish user growth is a pressing concern. In the third quarter of 2015, Twitter just added 4 million new users, taking the count to a total of 320 million users. To put this in context, Instagram boasts 400 million users while Whatsapp has a user base of 900 million. At nearly 1.55 billion users, Facebook is the largest social media service.
As a part of the strategy, Twitter launched a news curation feature, Moments, in October. Moments is not only an attempt to make the Twitter experience better for current users but also an effort to rope in new users who find the site too confusing or unnecessary. Moreover, Twitter is supposedly mulling the idea of increasing its signature 140 character limit, thus enabling people to post longer tweets.
As more users spend time on Twitter, the company expects to bring in more ad dollars to boost the top line. With the Buy Now feature, the company is banking on its e-commerce platform to generate additional value.
At present, Twitter carries a Zacks Rank #3 (Hold). Better-ranked stocks worth considering in the broader technology space include Amazon.com, Inc. AMZN and Blue Nile Inc. NILE. Both carry a Zacks Rank #2 (Buy).
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