Everyone once in a while, a phenomenon appears, is seen by all, but somehow its relevance slips through the cracks. It happened to TiVO, it happened to those little cameras on our cell phones, it happened to text messaging and it even happened in small part to Google Search. It's not that no one knew these things existed, it's simply that the impact of their existence wasn't recognized until much later. Twitter has something that will fall into this category. It's little. Everyone knows it exists. But it has taken Disney, Gatorade and Volvo to remind everyone how powerful it is. And the best part for Twitter, no one can copy it. No one else owns it. And it will never go away.
In a note just a few weeks ago we wrote that "The Tide May Be Turning for Twitter Inc. (NYSE:TWTR)." While we were attending the Twitter Inc. shareholder meeting, the idea of a competitive advantage was rattling around in our minds. Facebook In. (NASDAQ:FB) dominates social media with 1.65 billion monthly average users (MAUs), and an utter ownership of the mobile advertising world.
Alphabet Inc., (NASDAQ:GOOGL) on the other hand, dominates desktop and its YouTube property has absurd usage, like nearly 3 million video views every minute. YouTube has more viewers aged 18-49 on mobile alone than any other network or cable television broadcast channel in the United States.
So Twitter has to make a place for itself, somewhere outside of Facebook's unrelenting popularity. But then something happened. It was announced by Twitter Inc. on its blog and it seemed cool, but not really world changing, until we dug a little deeper. What we ended up finding was not only incredible, but it is the most powerful social media weapon of any company in the world. It cannot be replicated, cannot be competed with, happens 500 million times a day and Twitter owns it forever. Even the mighty Facebook Inc. (NASDAQ:FB) can't claim what Twitter can claim. Here we go.
This is the prologue to what we are about to understand, this isn't the secret weapon, yet. On June 3rd, 2016 Twitter Inc. (NYSE:TWTR) announced a new advertising product called "Promoted Tweet Carousel." Here's a quick overview from the company itself
That's creative, but hardly world changing and hardly a secret weapon. But let's go deeper:
Twitter Inc. (NYSE:TWTR) wrote that "Since we began discussing this ad unit, advertisers have expressed their excitement about being able to leverage the Promoted Tweet Carousel." Now here's where it started to turn, where the truth began to be revealed, and I'm not sure even Twitter yet understands what it has, and no, it's not the carousel.
Disney is leveraging the Promoted Tweet Carousel to promote a movie, but read how they will promote it:
Gatorade and Volvo are also on board. Now, here's the secret weapon in plain sight.
THE SECRET WEAPON
The new ad unit that has the largest movie studio in the world all in, has the largest sports drink maker all in, and one of the largest auto makers all in and the reason is very simple. It's not a carousel. It's not a cool new technology. Friends, the secret weapon, the uncopiable intellectual property, is simply a tweet.
Here's a reprise of what Disney said, this time, with our emphasis added:
Here is more from Twitter Inc. (NYSE:TWTR) about carousel, again, with our emphasis added:
Yes, the guts behind carousel, the guts behind the innovation, the guts behind the advertising is a tweet. That little 140 character microblog sent out 500 million times day. Twitter Inc. (NYSE:TWTR) has one advantage no other social media has, and that is that its core social post is in fact content in and of itself.
No other social media company or advertiser has a weapon so unique, so powerful and so influential. One "tweet" can start a revolution. A tweet and a hashtag on Twitter is this powerful:
This hashtag has been emblazoned across signs held among the thousands of protesters who are calling for an end to police brutality and the killings of African-Americans in the U.S.
After Boko Haram militants kidnapped hundreds of girls from a Nigerian boarding school on April 15, an international campaign was raised to pressure the Nigerian government to "Bring Back Our Girls."
Now social movements are huge, but not to be crass, they don't create cash flow. But the influence of "the tweet" has finally been recognized. The tweet itself is the advertisement for Carousel, and Disney, Volvo and Gatorade already get it.
We can say what we want about the woes of Twitter, and there have been many woes. But a Facebook Inc. post is not content. It's not valuable beyond its intended reach. No advertiser will pay for a Facebook post.
But the tweet is content that is so valuable that it is in and of itself worthy of ad dollars just because it was written. And the tweet exists in one place. The tweet has one originator. The tweet cannot be copied. The tweet happens half a billion times a day. And most importantly, the tweet belongs to Twitter.
And that friends, is as bullish a thesis as you can write.
SEEING THE FUTURE
This is the beginning of analysis, not the end. To really understand why Twitter will finally be a winner, and then to go further, to find yet again the 'next Apple' or the 'next Facebook,' we have to get ahead of the curve -- with facts. This is what CML Pro does. Our research sits side-by-side with Goldman Sachs, Morgan Stanley and the rest on professional terminals, but we are the anti-institution and break the information advantage the top .1% have.
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Thanks for reading, friends.
The author and the author’s household hold shares in Twitter as of this writing.