View Count: 108 |  Publish Date: March 02, 2014
Twitter steps up efforts to woo users as growth slackens

Kyle Bowes signed up for a Twitter account more than two years ago to keep up with his favorite soccer team. In that time, hes sent a total of 12 tweets.
Bowes, 21, works just 2 miles down Market Street from Twitters San Francisco headquarters, where engineers are working to solve the problem he represents: members who dont actually use the microblogging services product, or worse - people who dont think they need Twitter at all.
I dont know what I would say on Twitter, said Bowes, who follows postings about the Arsenal Football Club, based in London. Sometimes the players will say things that are important news, so thats why Im on there, but Ive never actually done anything.
Chief Executive Officer Dick Costolo is facing a slowdown in new-member growth at the same time as some Twitter users are checking in less often. To cope, hes planning such changes as more images and different ways to organize information, designed to make the service more appealing and easy to access, especially for newer users.
The pressure to overcome these hurdles is increasing as Twitter seeks to boost advertising revenue and justify a stock price that has more than doubled since November. Twitter doesnt have the war chest to acquire growth like rival Facebook, which last month signed a $19 billion deal for mobile-messaging service WhatsApp. With just $2.2 billion in cash, Twitter has to invent blockbuster products internally.
Its absolutely critical that they re-engage audiences and get some growth going, said Arvind Bhatia, an analyst at Sterne Agee & Leach. Its the No. 1 issue with investors today.
Costolos planned changes also include ways to woo reluctant consumers. Hes also hunting for a product chief to replace Michael Sippey, who left in January.Growth potential
Twitter, which sold stock in an initial public offering at $26 per share in November, has since ballooned to $55.92, making the unprofitable company worth $31.7 billion. Investors are paying a premium for Twitter shares compared with Facebook or LinkedIn, based on the companys growth potential. Analysts project Twitters revenue will rise 85 percent this year, according to data compiled by Bloomberg.
Some investors were expecting the company to deliver on that potential sooner. The stock tumbled a record 24 percent on Feb. 6, a day after Twitter said monthly active users rose 30 percent from a year earlier to 241 million in the fourth quarter - slower than the 39 percent gain posted in the prior period. Facebook has 1.2 billion monthly active users.
Many people use Twitter for following live commentary from friends, news sources and celebrities such as pop stars or sports figures. While the service is something that many consumers want, it may never be viewed as a social need - such as a grandmother logging into Facebook to see pictures of her grandchildren, said Martin Pyykkonen, an analyst at Wedge Partners. Costolos challenge is adding features that will hook casual users and get them to spend more time on the site.
If youre Twitter, you have to be thinking about how to make it more mainstream, more general-purpose for usage, Pyykkonen said. Making it easier to use while still maintaining that real-time information flow is going to be really important for them, and youd hope that they were already thinking this way and arent in panic mode.
Twitter, whose service lets users send 140-character status updates to followers via the Web or mobile device, has already had some success in influencing user behavior by changing its design. Making photos more prominent in users feeds in the fourth quarter led interactions with Tweets to rise 35 percent, Costolo has said. Putting a messaging option more prominently in Twitters mobile application caused message frequency to rise 25 percent.
To jump-start user growth, the company will make the product more focused on conversations, integrate more photos and videos, and test ways to organize information along topic lines, instead of just chronologically.Joining up
Twitter also plans to make it easier for people to get started on the service. Unlike on Facebook, where people build their social networks based on an existing set of friends, Twitter users have to decide what information sources to follow and how to personalize the product, making for a longer journey before understanding what value it can deliver, Pyykkonen said.
That can alienate potential users like Irma Sanchez, 22, of San Francisco. She was introduced to Twitter through her sister, who follows celebrities, yet didnt create her own account.
My sister uses Twitter to be up in famous peoples business, Sanchez said. I dont know why I need to spend time on that. It didnt seem interesting to me.
Costolo said recently that Twitter now lets people import their mobile-phone contacts to see who they can follow on the service to get started, one step in a longer-term plan to make it more accessible.
Some of Twitters new designs look like a product that Sanchez does use - Facebook. The company this month started testing a version of profile pages with a wide background photo across the top of the page and a smaller profile picture on the left-hand side, similar to what Facebook does on its member pages.
Twitter has also been increasing the pace of its product testing to release new updates on Android-based mobile devices every week, for example. The company did 23 things in the fourth quarter to improve its product, like letting users send photos in private messages and allowing advertisers to target people talking about television shows, according to Heath Terry, an analyst at Goldman Sachs Group.
Sarah Frier is a Bloomberg writer. E-mail:

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Time: 1:13  |  News Code: 388353  |  Site: San Francisco Chronicle
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