Twitter (NYSE: TWTR) recently released a blog post touting its advertising platforms as highly influential on holiday shopping. The post outlined analysis conducted by marketing research firms Crimson Hexagon and DB5, and ultimately asserted that 64% of Twitter users have purchased a product because of Twitter.
Although the article is intriguing, the fact that it was released by the company instead of an impartial third party leaves readers wondering, "Is this just propaganda?" The answer: a resounding "no." Advertisers have already picked up on this, and as investors begin to do the same, Twitter can expect a substantial increase in value.
Source: Crimson Hexagon
Companies value Twitter
Many large companies are already advocating Twitter's effective advertising platforms. Shawn Gensch, senior VP of marketing at Target (NYSE: TGT), comments, "Twitter has become an essential way for Target to give our guests the inspiration and ideas they crave whenever they're in the mood to shop ." Further, Target's marketing team is so sold on the belief that Twitter influences holiday shopping that it will be holding a live Black Friday Twitter chat. Jeff Jones, Target's executive vice president and chief marketing officer, will be driving from store to store throughout the day, making observations on popular items and marking them "#TargetChat" .
Similarly, Best Buy (NYSE: BBY) will also be leveraging Twitter during the holiday season through products offered by Wayin, one of Twitter's official product partners. Essentially, Wayin collects and visualizes social data and enables companies to manage, customize, and store that data on any site.
Best Buy will use this technology to display to both online and in-store shoppers the products generating the most hype . This will manifest itself in www.bestbuy.com/trending, a portal that displays top-rated products and tweets describing them.
Toys"R"Us is even utilizing Twitter for its holiday advertising. The company recently released an ad tagged with "#wishinaccomplished," in which children on a school bus are surprised with a trip to the toy store . This ad was the first of a few, all of which prominently display the hashtag. When consumers search the hashtag on Twitter, they are brought to Toys"R"Us' feed, which lists all the company's Black Friday deals and prices.
Further, many other companies, including Macys, Sears, Walgreens, Rite Aid, and CVS, among others, initially leaked their Black Friday deals on Twitter, generating buzz significantly earlier than in years past .
What's the point?
The point is simple: In light of current marketing trends, it's safe to say that the results of this study are true. Twice as many companies are utilizing the platform this year compared to last, and the message they are sending is clear: Twitter's advertising mediums work. Last year, from the third quarter to the fourth, the company saw a 36% increase in revenue and a 10% increase in active users, most of which is attributable to holiday advertising . This year, as CMOs continue to catch on, the company can expect similar, if not higher, growth rates.
Final Foolish thoughts
As this holiday season comes and goes, Twitter's revenue will increase and investors will begin to realize what some marketers already have. As a result, Twitter's value will likely increase as well.
Find out what's in store for 2014
The market stormed out to huge gains across 2013, leaving investors on the sidelines burned. However, opportunistic investors can still find huge winners. The Motley Fool's chief investment officer has just hand-picked one such opportunity in our new report: "The Motley Fool's Top Stock for 2014." To find out which stock it is and read our in-depth report, simply click here. It's free!