The tubes were buzzing yesterday about Twitter’s new round of funding from Kleiner Perkins, whose $200 million dollar investment brings Twitter’s total valuation to around $3.7 billion. As someone who has been involved with VC investment before, I can tell you that while the valuation is very exciting, the hard part is this – finding the best way to spend that $200 million wisely. Longtime Twitter users will no doubt point to investments in infrastructure, data mining or development tools, but after looking at a year’s worth of statistics on Twitter, they have a more pressing need – acquiring users.

Note that I did not say acquiring user accounts, which appear to to be growing at a steady clip, but much of that growth is either from simply entering new markets around the globe or from existing users establishing multiple accounts for businesses, brands or even events. Here is what I do know: in the first quarter of 2010, Edison (my company) produced a nationally representative study of Twitter usage in America that pegged the percentage of Americans 12+ using Twitter at 7%. Now, the Pew Internet and American Life Project has released its December 2010 figures, showing Twitter usage at 8% of online Americans 18+. To make this comparison slightly more apples to apples, however, the Pew figures, which are amongst online Americans only, can be adjusted to all Americans, which drops their percentage down to 6% of Americans 18+.

Image representing Twitter as depicted in Crun...
Image via CrunchBase

So many of the findings of the new Pew report are in complete lockstep with the earlier Edison data (the higher percentages of young adults and minorities that use Twitter, for example) that the two studies genuinely reinforce each other. No matter how you slice these numbers, the conclusion is inescapable. Here we have two, highly credible and properly sampled consumer research polls that show, accounting for margin of error, that Twitter’s growth in actual human American users is statistically flat. In other words, in the 10 months between the sampling frames for the Edison data and the Pew data, the percentage of Americans using the service does not appear to have budged to any statistically significant degree.

So, whether you are a Twitter enthusiast or a Twitter investor, you have to reconcile what are, on the surface, two contradictory pieces of information – one, that “user accounts” are growing at a healthy clip; the other, that users are not. Are there new users joining the service every day? Surely. What counting user accounts does not tell you, however, is how many users are leaving the service every day, abandoning those user accounts. I’m not suggesting that there is, in fact, a high churn rate amongst Twitter users – I am merely offering that we don’t know.

Facebook in this country has crossed the chasm from early adopter channel to becoming a mainstream communication platform. These data suggest that Twitter has come right up to the edge of that chasm, but has yet to make the leap. Do you agree? Do you sense that this is true for your business, or have you seen evidence to the contrary? What do you think it will take to propel Twitter across that consumer adoption chasm, and into the lives of mainstream consumers?

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About Tom Webster

Tom Webster

Tom Webster is Vice President of Strategy for Edison Research, sole provider of U.S. National Election exit polling data for all major news networks. Webster has 20 years of experience in market and opinion research, with a particular emphasis on consumer behavior and the adoption of new media and technology. He is the principal author of a number of widely-cited research studies, including Twitter Usage In America, The Social Habit, and The Podcast Consumer Revealed, and is co-author of the Edison Research/Arbitron Internet and Multimedia Research Series, now in its 18th iteration. Reach him on Twitter at Webby2001, or on his blog at BrandSavant.

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Comments on Social Media Explorer are open to anyone. However, I will remove any comment that is disrespectful and not in the spirit of intelligent discourse. You are welcome to leave links to content relevant to the conversation, but I reserve the right to remove it if I don't see the relevancy. Be nice, have fun. Fair?

  • bradgosse

    One of the things that Facebook did correctly from the start was the only allowed one profile for real human being. They have always enforced this. Twitter allows far too many accounts per person in my opinion. If they made it more of a personal network I think it may have stunted their growth the beginning, it may have acquired a larger number of unique users that way.

  • http://www.puredriven.com Patrick Garmoe

    I still wonder about Twitter's future beyond a very niche communications platform.

    I can't name one person who isn't either in traditional media, or a marketer of some form, who truly loves Twitter. I love it, and completely realize its value, but it takes considerable time to realize its value, and for companies and people who don't stick with it for six months to a year, there's a good chance they'll never benefit from it.

    And if they don't produce good content to share, it can also be useless, beyond being a great way to hear what others have to say.

    Even with today's tools, it feels clunky, and reminds me a lot of amateur radio, which I was deeply involved in at one point in my life. It's great to talk with friends and people in the online marketing and PR world, and media world, but there feels like a real dearth of online communities beyond that.

    I think the hype has run its course for Twitter, and I at this point doubt I'd invest. And that's coming from someone who understands and loves the service.

  • http://mytwittertoolbox.com David Perdew

    From a user's standpoint, it's interesting to note that Twitter is easier to setup, navigate, and update than Facebook, yet Facebook seems to have excelled in retaining users. I agree that multiple accounts are creating some of this attrition, and spam seems easier to infiltrate Twitter than Facebook, too. I'm not sure how a social media client with millions of accounts goes about attracting new followers, but maybe that needs to be on somebody's radar at Twitter camp.

    The other thing is, you wonder how many of the people who use external account managers like HootSuite, TweetDeck, or Social Oomph get lost in the final count, because they're not on the Twitter site every day?

  • http://scotduke.com mrbusinessgolf

    Unless the conversations between Twitter users picks up so connections can be validated I can't see how Twitter can prove its worthiness as a micro-blogging platform. Right now, Twitter is having a Link-fest and ReTweet-a-roma… Very few conversations. Consumers' interest in Twitter is waning since reading headlines for blogs and product promotions is not what they come to Twitter to do.

  • http://twitter.com/dancristo dancristo

    The problem with Twitter is that it is very difficult to use at first. Everyone heard the buzz, created an account, but most never followed more than 10 people. They were expecting to find friends like Facebook, but Twitter isn't about that. Right now, Twitter is about finding news, and following interesting people you don't know in real life. That's a hard thing for a lot of people to latch on to.

    Twitter will continue to grow, but unlike Facebook, it's not a platform for everybody.

  • http://flavors.me/40deuce 40deuce

    Interesting stuff Tom.
    I think Twitter has great potential for huge amounts of growth in users as people find new uses for the service. Facebook has a whole community of people that want to stay in touch with friends and the marketing part was built on afterwards. I think Twitter still comes off to non-users as a platform for “just talking” with anyone around the world. While there's huge value in that valuable information is beng shared there, they've yet to find a real way to convince the masses of ways to use it.
    I think that as people continue to find new and better ways to use Twitter (which is one of my favourite things about Twitter; there's so many ways people could use it) the people will start coming. 2010 saw a lot fo growth for Twitter, but I think 2011 will show even more.

    Cheers,
    Sheldon, community manager for Sysomos (http://sysomos.com)

  • http://ariwriter.com Ari Herzog

    I recently heard a perspective that in the coming years Google will buy Twitter. Makes sense to me. So, who really cares if Twitter crosses a chasm.

  • Mack Collier

    I think many of you, especially Patrick, nailed the key points here. Twitter has amazing potential as a communication platform, a learning platform, a networking platform, a promotional platform, etc etc etc. The problem is, it takes so long to FIGURE OUT the potential of the service. I used Twitter sporadically for 9 months in 2007 before the lightbulb went off and I 'got' it. The teenage girl that signs up tomorrow cause she wants to tweet to Lady Gaga won't give the service longer than a day to hook her in. It probably won't, and she'll go back to Facebook, cause she 'gets' it.

    Twitter could benefit from spending some of that $200M on educating others on exactly what the service is, and how it can be used. Or maybe it's time to actually hire a Community Manager and put a spotlight on Twitter's existing users that are making innovative uses of the platform.

  • http://www.marketinginprogress.com Brett Duncan

    Mack nailed part of the problem on the head. Reading through the comments, Twitter is actually pretty great for a lot of the things people are complaining about below. The problem is most people aren't using it in a way that makes sense. I personally feel like Twitter really is more important for business than Facebook is. Just its sheer openness and search.Twitter.com alone are gold mines for businesses.

    With that said, it will never eclipse Facebook. But maybe that's not the point. Maybe the 8% using it are a special group and extremely influential online, on and off Twitter (I think there are some studies out there that support that).

    bd
    @bdunc1

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