For some reason I can’t quite explain, I find yesterday’s news story about Twitter Inc.’s infusion of money very interesting. This is a company, an organization, that is only 3 years old…just a toddler in the world of business, but is making headlines around the world. The news story says, “…The investment values the 3-year-old company at $1 billion, even though it has yet to generate any meaningful revenue, let alone profits….” And for some other reason, this made me start thinking of home businesses and customers.
The article says that Twitter right now has “…more than 54 million worldwide users…” which I can attest to…not that I know 54 million people, but of the 700+ followers that I currently have for my Twitter account, there are indeed people from other countries of the world.
I found the news story interesting on two counts:
- that the company has yet to produce any meaningful revenue, even profit, yet it has millions of users
- it has millions of users
In the current economic climate, I know of some home businesses [which I mention because this blog concerns itself home-based business] that are not making a profit. They’ve lost customers because their customers have cut back on spending. Also, home businesses have people who are “interested” in the products or the opportunity [if it’s a direct selling business the opportunity itself is one of the products]…but right now these are not paying customers. Kind of like Twitter Inc.’s users...we are not paying customers are we?
If Twitter is a company, then who are its customers? Makes you wonder about the definition of customer:
- someone who purchases a commodity or service
So, if all 54 million of us who tweet [send the 140 characters or less messages] on Twitter are not purchasing its services, then we users aren’t Twitter’s customers – are we? Then who is?
A good basic, foundational business question to ask of yourself is just that: who are your customers? Who are the people who will pay money for the goods or services you produce or provide? It is through the medium of customers that revenue is generated and profit obtained. You could make an equation:
- business profitability = products&services x people who buy them
Math is not my long suit but I’m hoping that Twitter Inc.’s owners and stakeholders [those who have a share or interest in an organization] will figure out a way for Twitter to become profitable so that it can pay its employees and keep innovating.
When I was young I never dreamed of something like the internet and I certainly never dreamed of anything like Twitter. I find it fascinating. I have a prediction, based on only what I think: should Twitter turn its users into customers, it’ll lose…big time. Rather it makes sense to me for Twitter to put advertising somewhere in its world. Facebook does, YouTube does. Again, both of these social media have users who do not pay for a presence, but do offer users and others ways to advertise their goods and services. That’s our market system at work.
Here’s a question: Do you use Twitter? For what? Social interaction? Business? If not, why not?