Twitter is one of the most popular social media platforms in the world, with over 300 million active users. However, the company is facing some challenges in terms of user growth, revenue, and innovation. I will explore how Twitter could transition into a different business model that could offer more value to its users and stakeholders.
One of the main reasons for Twitter’s financial woes is its reliance on advertising as its primary source of income. Advertising accounted for 86% of Twitter’s revenue in 2020, but it also exposed the company to the volatility of the ad market and the competition from other platforms. Moreover, advertising may not be the best way to monetize Twitter’s unique value proposition: its ability to connect users with real-time information and conversations on various topics.
One possible direction for Twitter is to become a platform for content creation and monetization. Twitter already has a large and engaged audience that consumes and shares various types of content, such as news, opinions, memes, videos, and podcasts. However, Twitter does not have a clear way for content creators to earn money from their work, unlike other platforms such as YouTube, Patreon, or Substack.
Tekedia Mini-MBA edition 16 (Feb 10 – May 3, 2025) opens registrations; register today for early bird discounts.
Tekedia AI in Business Masterclass opens registrations here.
Join Tekedia Capital Syndicate and invest in Africa’s finest startups here.
Twitter could leverage its existing user base and network effects to create a subscription-based service that allows content creators to charge their followers for exclusive access to their content. This would create a new revenue stream for Twitter and incentivize more quality content on the platform. Elon Musk is already pushing this feat, but the pathway isn’t clear right now.
Another possible direction for Twitter is to become a platform for social commerce and transactions. Twitter already has a lot of influence on consumer behavior and trends, as well as a rich source of data on user preferences and interests. However, Twitter does not have a seamless way for users to buy and sell products or services on the platform, unlike other platforms such as Instagram, TikTok, or Shopify.
Twitter could integrate e-commerce features into its platform that allow users to discover, browse, and purchase products or services from other users or brands. This would create a new revenue stream for Twitter and enhance the user experience on the platform.
Twitter could create a more differentiated and valuable experience for its users, while also generating a more stable and diversified revenue stream. According to some estimates, Twitter could potentially earn $1 billion in annual revenue from subscriptions if it charges $5 per month to 20% of its user base. Additionally, Twitter could also reduce its dependence on advertising and improve its brand image and reputation.
Of course, transitioning into a subscription-based model is not without challenges and risks. Twitter would have to convince its users that the premium features and services are worth paying for, while also maintaining a free tier that attracts new users and retains existing ones. Twitter would also have to invest in developing and maintaining the premium features and services, as well as ensuring their quality and security. Furthermore, Twitter would have to deal with the potential backlash from some users who may perceive the subscription model as unfair or elitist.
However, I believe these challenges and risks can be overcome with careful planning and execution. Twitter has a loyal and engaged user base that values its platform for its unique content and communication capabilities. By offering them more value-added features and services that enhance their experience and satisfaction, Twitter could create a win-win situation for both it and its users. Therefore, I think that transitioning into a subscription-based model is a viable and desirable option for Twitter’s future growth and success.
These are just some of the potential ways that Twitter could transition into a different business model that could offer more value to its users and stakeholders. Of course, there are also many challenges and risks involved in such a transition, such as user backlash, regulatory hurdles, technical difficulties, and competitive threats. However, I believe Twitter has the potential to reinvent itself and become a more innovative and profitable company in the future.