Analysis of Twitter - Case Study Example

Twitter Name Institution Course Professor Date Table of Contents Table of Contents 2 Introduction 3 Reasons for Company Competitive Nature in the Market 4 Sustainability of Business Model and Competitive Advantage 5 Strategic Leadership Approach 7 Recommendations 9 Conclusion 11 Bibliography 13 Introduction Twitter is among the successful companies, which operate in the social network industry ('Don't leave, Twitter' 2011). The company is regarded as a micro-blogging service provider that enables its subscribers to send or share “tweets” up to 140 characters with friends that are “followers”. The company has being influential in socio-political events, which include the U.S. presidential campaign of Senator Barack Obama. Twitter has attained a competitive edge in its market segment of the social network. This is because the company has focused at providing quality services to its users. The company also has a developed brand name, which has enabled it to gain global popularity that has enabled users from different geographical locations to associate themselves with the company. Twitter also attracts other companies by providing advertising services to these companies. This is a strategy, which has enabled the company to attain success within its business environment. Moreover, Twitter has a strong strategic leadership structure, which has contributed significantly towards developing and training leaders competent of taking the company to the next performance level. This includes addressing all the challenges of its leadership. As such, this report is an analysis of Twitter. The analysis is based on the business model and competitive advantage of the company. This includes identification of the reasons, which have contributed towards improvement in the competitive strength of the company. The report also provides an analysis of Twitter’s strategic leadership and how the company addresses issues and challenges, which it faces at strategic level. Finally, the report provides information on management recommendations for changes, which Twitter needs to adopt in order to improve its performance level. The report concludes by arguing that Twitter has attained global popularity and competitive edge, but there is a need for a focus on further development of technology level in order to ensure that the company does not face stiff competition from other key players in the same market like Facebook. Reasons for Company Competitive Nature in the Market Twitter has attained a higher competitive level in the market because of its ability to use referral services (PR 2012). These have contributed towards attracting new users and retaining the current users. This referral services provides users with an opportunity to share with their friends and family members from different geographical locations. On the same note, Twitter has entailed extensive media coverage, which has granted it an opportunity to reach more clients. In this, the company has ensured that it markets itself within all the social media sites where people from different geographical locations converge to interact with one another. Furthermore, Twitter has adopted an open source platform that has created an opportunity of third-party applications development. This has contributed towards marketing and strengthening the brand name of the company. The ability of the company to provide services, which can be integrated with other web services or applications, contributes towards the attainment of the competitive nature of the company (Andrew 2011). This makes the company to become a net-based chartroom, which is comprised of friends. Moreover, organisations from different geographical locations have identified the potential of Twitter as a marketing tool. As such, organisations have adopted Twitter as a means of reaching greater market segment. This has enhanced the process of marketing Twitter. Employees from various organisations act as the key agents of marketing organisations via the service provision of Twitter. Embracement of the services of Twitter by political and other social events has aided in marketing this company. In 2008, Twitter was actively used in the process of Obama presidential campaign. The attacks in India and Mumbai in 2008 took place because of the service provided by Twitter. Election of the Iranian president also saw Twitter grow as tool, which was used by protesters to communicate on various activities. In addition, Twitter has not stopped its political role. For example, Egypt and Tunisia 2011 “Arab Springs” are associated with Twitter services. This indicates that the ability of the company to get involved in various political activities from different segments has enabled it to reach a new market and retain such market segments. Twitter has being able to attract a strong base of investors (PR 2012). This has enabled the company to have a large pool of funds, which contributes towards boosting the resource base of the company. This has enabled attainment of success for the company. Such large investment in the company was evidenced in 2009 when investors from Spark Capital, Institutional Venture Partners, Digital Garage, and Benchmarks Capital among others injected $ 155 million into the company. Sustainability of Business Model and Competitive Advantage According to Barnett (2012), Twitter business model is based on promotion of products, which include accounts and tweets. As such, Twitter engaged in Business to Business advertisement, which is a model that has enabled the company to expand into new markets and earning a strong customer base for its services. Advertisement has seen Twitter gain more collaborative options from various companies, which are focused at advertising their products and services. This has resulted in earning of enormous profits from the advertisement campaigns. Twitter has embarked on controlling the content, which flows through its network path as a means of monetizing. This is an effective means of the company to ensure that its corporate reputation is not destroyed (Andrew 2011). As such, the company will not receive a negative attitude from its customers, non-governmental organisations, and State, as well as Federal governments. However, Twitter may never attain success by making advertising its primary revenue source. This is because it will receive a perception of being in the same operational strategies as the newspaper industry and television industry where the main customers are advertisers. Moreover, making advertising the primary revenue base for the company will deny the company opportunities of exploiting revenue, which is available within its business environment. Furthermore, Twitter may attract more attention from advertisers, which will make users avoid advertisers’ attention (Ingram 2012). This will result in a reduction of customer base for the company. Twitter competitive advantage is based on its ability to provide a platform for mass-scale marketing (Investor's Business 2011). In this, every tweeter acts as a marketer while a follower of the “tweet” acts as a potential re-marketer. As such, Twitter is able to penetrate its business environment through the “promoted tweets”, which enable connection of different groups of people and individuals in different geographical locations. On the same note, clicks and re-tweets that emerge from tweets of advertisers contribute towards generation of revenue to the company. Moreover, Twitter has embraced American cultural norms, which have contributed towards earning of global popularity for the company (Laura 2011). Egalitarianism is a norm, which is found in the service provision structure of Twitter. This provides an opportunity to all people, irrespective of their career, gender, and social status, to send messages to their friends and celebrities like Oprah Winfrey. As people send these messages they are aware that recipients of such messages may never respond, but the egalitarianism norm is still present in the provision of this service. Furthermore, people have a freedom of choosing on the best way to send these messages. This contributes towards the development of a positive attitude among the users on the benefits and reliability of services. This has contributed towards the development of a competitive advantage for the company. Brand of a company contributes towards development of a positive reputation and improvement in the competitive advantage of a company. Twitter is one company, which has a well established and developed brand, which is recognized at a global level (Investor's Business 2011). This brand has contributed significantly towards improvement in the performance level of the company. This has occurred since users have developed the desire of associating themselves with the brand of the company, which is selling successfully at global markets. Strategic Leadership Approach Strategic leadership is focused at ensuring that a firm improves its performance level (Calloway et al. 2010). As such, the leader is committed towards ensuring that he or she has a way forward for attainment of success. Twitter strategic leadership is focused at ensuring that the company has the ability of attaining global success. In this, the company has ensured that all of its strategies are leadership driven. This occurs by engaging all the senior and junior leaders in strategic activities, which are focused on attainment of success. The leaders support these strategic activities and ensure that the company is able to operate at a sustainable manner. Twitter has outlined its objectives for strategic leadership. These have contributed towards ensuring that the company has the ability to attain success. The objectives act as the guiding principles for the performance of the company (Calloway et al. 2010). This includes reflecting on the company success and influencing the functionality of various activities in the company. Furthermore, the objectives have contributed towards structuring an effective strategy, which is suitable for attainment of success. Values are the essential elements, which are included in the strategic leadership of Twitter (Leibner et al. 2009). This includes providing the company with commitment guidelines and right thing for conducting various activities in order to improve the performance level of the company. The leaders of the company also ensure that everything is done in a rightful manner. They do this by being focused and committed to the outlined structure of strategic leadership. This has ensured that leaders in this company are extremely engaged in the process of ensuring that the company attains its desired goals and meets its objectives. The key focus of Twitter’s strategic leadership is the performance of the company in the future. As such, the company formulates its business strategy, which is aimed at seeing improved performance and expansion in the future (Hwang 2012). The formulated business strategy is effectively communicated to all departments of the company in order to ensure that all individuals have the ability and power to recognize the vision and mission of the company. This also facilitates in consolidation of all the business activities of the company with an aim of attainment of success. This creates a platform for the management of the company to identify the needed resources and allocate them effectively when accessed. This ensures that the company has the ability of meeting its business goals. A key challenge for Twitter strategic leadership is the management of inequality and diversity of employees. This occurs since the company attracts employment from a large pool of employees from different geographical locations (Leibner et al. 2009). As such, managing and leading these employees seems to be a complex activity for the company. This is because the company has to ensure that talent management takes place and cultural diversity issues are addressed. Nevertheless, Twitter strategic leadership has been able to address this challenge. This has occurred since the company has outlined a structure for strategic leadership training, which is focused at ensuring that success is attained in the company. In this, leadership training is based on the structure. Moreover, training of leaders occurs effectively where the issue of cultural diversity is addressed. This provides an opportunity for all employees to comprehend the need of being effective in their leadership activities (Calloway et al. 2010). This includes training on how to handle issues, which are related to the complex nature of diversity problems and inequality issues. Recommendations Twitter may improve its revenue base by considering two options of monetization together, which are subscribers and advertising (Laura 2011). This will ensure that the company is able to maintain its users and attract advertisers who are sources of revenue for the company. Concentrating on advertising will not add to the success of the company since this may distract users from finding interest in the company. Therefore, Twitter has to establish effective strategies, which have the ability and potential of integrating the subscribers and advertising monetization options. Effecting Business-to-Business model for the company will contribute towards growth and attainment of a competitive advantage for Twitter (Investor's Business 2011). This will ensure that Twitter has the potential of attracting more engagement with companies, which want to advertise and provide their services at a social platform. This will contribute towards improvement in the performance level of the company. Nevertheless, Twitter has to ensure that its accounts are verified for all enterprise subscriptions. This is essential in order to ensure that customers who register companies are actively involved in business activities with the company instead of being squatters or imposters. This contributes towards attainment of a real expansion of the company. Moreover, subscription statistics are crucial for the company to determine its success level and performance within the operational market. With all the company subscriptions, Twitter should charge some fee for the provision of the service. This will act as a means of improving the revenue base for the company. E-commerce is also an essential feature, which Twitter should embrace in running its business activities. This will provide a platform for linkage of Twitter with several other companies. In terms of strategic leadership for the company, Twitter Company needs to focus on ways of ensuring that it taps a large pool of talent at a global perspective, which is not limited by diversity issues. In this, the company has to develop creative and new ways that will contribute towards overcoming the issue of cultural diversity problem (Andrew 2011). This will ensure that the company has the ability to attract a large talent, which is strategically fit and focused towards improvement of the performance level of the company in order to attain the desired success level. Customer service is an essential activity for all companies. This is because through provision of customer services, a company has the ability of identifying the needs of customers, as well as gathering information from customers on feedback in terms of provision of various services by the company. This indicates that Twitter needs to ensure that it embraces the concept of customer service whereby it facilitates effective conversation between users and the company to take place. This will create an opportunity for the company to gather credible information on users’ responses and their thoughts about the company. The service will also ensure that the company is able to boost confidence level of its users since when they interact with the management team of the company they tend to develop a feeling of company ownership. Collaborating with other companies is an effective means for improvement of the performance and attainment of a large market for the company. However, as Twitter engages in collaborating with other companies, there is a need for Twitter to first assess the performance level of such companies. This is because in case the company has a poor performance and negative brand reputation, Twitter will lose its customer base. This will occur since customers will start associating Twitter with the company that has a poor reputation in terms of performance. In addition, Twitter needs to conduct an effective market research. This research will act as a tool of accessing and evaluating the performance level of the company within its market segment. This will include identification of the various needs of users. User needs identification will then act as a foundation for adoption of measures, which will contribute significantly towards user satisfaction. As such, the company will have an opportunity to improve its customer base and ensure that its users are satisfied with the services, which are being provided by the company. Furthermore, the research will also aid in determining how the company performs within its market segment in comparison to other companies. This will contribute towards adoption of measures, which will ensure that the company has the ability and potential to improve its level of performance in order to attain its desired success level. Conclusion Twitter is one of the companies, which has being able to distinguish itself from other companies in terms of attaining a stronger competitive edge in the market. This has occurred since the company has a strong strategic leadership structure and business model, which has contributed towards improvement in the performance level of the company, as well as penetrating new market segments. Moreover, the company is distinct from other social applications and networking media since it creates an opportunity for its users to make choices, which are based on information amount and length that one would like to be updated with or receive from other people. This form of interaction provides users with an opportunity to distinguish themselves as controllers of the information they receive from the social network. This is because users can check for tweets or updates from their desired followers. This includes the ability of ignoring some tweets and updates, which are from people they do not like. This indicates that users have the ability to regulate the information that flows online. The company has gained global popularity and improved its performance level. This includes expansion of its market segment to new markets. Consequently, the company has being able to attain a strong customer base whereby its users continue increasing throughout. Improvement in the performance level of the company has contributed towards attraction of investors into the company who have contributed in improvement of the financial health of the company. Furthermore, the financial health of the company has improved significantly. This has occurred since the company has being able to attract more investors. Formulation and adoption of effective business strategies, which have contributed towards improvement in the performance level of the company has contributed towards ensuring that the company is competitive within its market segment. However, Twitter has to realize that other social networks are improving their technology levels. This means that unless the company focuses on technology development and provision of better services, it may face stiff competition from the market, which may lead to a reduction of its performance and revenue earnings. Bibliography Andrew S., R 2011, 'Food trucks widen dining experiences', San Francisco Chronicle (10/1/2007 to present), 18 February, Regional Business News, EBSCOhost, viewed 13 September 2012. Barnett, E, 2012. Twitter Founder Jack Dorsey Defends Business Model. Available at < http://www.telegraph.co.uk/technology/twitter/9032348/Twitter-founder-Jack-Dorsey-defends-business-model.html> Calloway, J, Feltz, C, & Young, K 2010, Never By Chance: Aligning People and Strategy through Intentional Leadership, N.P.: Wiley, eBook Collection (EBSCOhost), EBSCOhost, viewed 13 September 2012. 'Don't leave, Twitter', 2011, San Francisco Chronicle (10/1/2007 to present), 14 January, Regional Business News, EBSCOhost, viewed 13 September 2012. 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