Virtual Game Changer: Twitter Changes CEO And Renews Focus On Revenue Generation
This past Monday, Twitter co-founder Evan Williams stepped down as chief executive of the San Fransisco based start-up. Following his departure, Williams handed over the operations of Twitter toÂ Google veteran Dick Costolo, who was brought in last year to help theÂ micro-blogging service generate revenue. In a recent post on the company blog, Williams noted that Costolo, who is currently serving as Twitter's chief operating officer,Â would immediately be taking overÂ as CEO.Â Following the transition, Williams will switch his focus exclusively to product strategy development.Â Costolo, whose Web content distribution company Feedburner was purchased by Google in 2007, has been at the forefront of efforts to begin monetizing Twitter since he joined the company last year. More importantly,Â Costolo, hasÂ extensiveÂ experience helping online companies generate revenue, having served as a consultant at Accenture (formerly Andersen Consulting) for seven years. He also understands how technology companiesÂ grow, as well as the steps required toÂ effectively scale an online business.Â According to Williams,Â since his tenure with the company began, Costolo has played a critical role helping Twitter devise and execute their revenue efforts, while simultaneously streamlining inter-office operations.
Since its initial launch in 2006, Twitter, which allows users to fire off messages of 140 characters or less known as "tweets," has enjoyed skyrocketing popularity. According to Williams,Â Twitter currentlyÂ employs around 300 people, a number that has increased from 20 when he took over asÂ CEOÂ two years ago. Dorsey, Twitter's previous CEO, is currentlyÂ Twitter's chairman.Â Over the last 2 years, under William's leadership,Â Twitter grew from three million registered users to more than 160 million today. Their product has in many ways become synonymous with popular culture, achieving strong market penetration and attention. Moreover,Â Twitter's user base and usage statistics continue to growÂ in most international markets. Unfortunately,Â while Twitter's usage stats are positive,Â significantÂ work needs to be done on the monetization front to ensure Twitter's long term growth and solvency. Like any business, growth rate and user baseÂ are not the soleÂ indicators of operationalÂ success. Money talks. Inevitably, long term success within the virtual sphere means increasing a company'sÂ revenues and ultimately profits. These increases are important - particularly for Twitter -Â because they will enable Twitter to increase its shareholder commitment, accesst to capital, market capitalization, and investment attractiveness. Moreover, such increases will enable Twitter to retain the culture that it currently holds,Â while enablingÂ the company to pursueÂ aggressive user growth inÂ underdeveloped markets. Of note, Williams' departure comesÂ three weeks after Twitter unveiled an overhauled website that enablesÂ people to more easily sift through the growing mountain of micro-messages.Â Twitter's "Promoted Tweets" advertising service now allows companies and others to placeÂ "tweets" at the top of a page of search results. While the initial reception for the promoted tweets service has been positive, unfortunately,Â only time will tell whether this leadership change will bear fruit.Â More importantly, it will be interesting to watchÂ how users respond to the monetization strategies thatÂ Costolo incorporates; users, who have historically been sensitive to the presence of advertisements within their online interface.