Almost all the social media companies including Facebook Inc (NASDAQ:FB) faced user growth slowdown in the third quarter. But is user growth the only measure to determine if the company is doing well? Gilt Groupe Founder and Chairman, Kevin Ryan doesn’t think so. He talked on Bloomberg TV about the social media stocks.
Ryan mentioned that Facebook Inc (NASDAQ:FB) has the slowest user growth compared to Twitter Inc (NYSE:TWTR) and LinkedIn Corp (NYSE:LNKD), but he feels that Facebook is monetizing and executing very well. So he feels that user growth is not the only indicator for performance of a social media company.
Ryan added that Twitter Inc (NYSE:TWTR) aren’t doing enough on the product side, he feels that most of the consumers still use Twitter platform the same way for almost 4 years. He thinks that Twitter platform is not as easy as the Facebook platform for the user. He mentioned that multiple heads of product in Twitter indicates that the company is not clear about how to shape the product for consumers.
“Any time any company has searches in any form that can be linked to a product that is really valuable. So if you know on Twitter that you just got engaged or you are thinking about a car or you are commenting on a new Armani Suit, that’s information that can be used to target you. Facebook does a really really good job at that and it works for many e-commerce companies. […] Twitter doesn’t have the same range of products Facebook has,” Ryan said.
Ryan insisted that Facebook Inc (NASDAQ:FB) is doing a really great job at targeted advertisement and on the way, helping out many ecommerce companies including his very own company. But he feels that Twitter is not up to the mark in targeted advertisements.
Ryan mentioned that they advertise in both Facebook Inc (NASDAQ:FB) and Google Inc (NASDAQ:GOOGL) for Gilt Groupe to attract new customers. He added that for the last two years Facebook has driven more traffic onto the Gilt website, which was majorly driven by Google before two years.
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