Twitter CEO Jack Dorsey’s big changes fail to entice users

Since returning to Twitter in July, chief executive, Jack Dorsey has made a multiple changes to the social network -- and promises more. But the new features so far have been unsuccessful at doing the one thing Wall Street wants most: getting more people to use the service. Among the drastic changes are altering the order of tweets, more appealing ads, making replies simpler and experimenting with longer tweets.

Communication Gap

Replying to tweets, quoting, retweeting have a learning curve. Most latch onto the logic instantly while others just don't. Dorsey wrote, " We are going to fix the broken windows and confusing parts, like the .@name syntax and @reply rules, that we know inhibit usage and drive people away.

"We're going to improve the timeline to make sure you see the best Tweets, while preserving the timeliness we are known for.

"Relentlessly refining Twitter will enable more people to get more out of Twitter faster."

Stunted Growth

Analysts say Twitter's stock price, which has reached record lows, is unlikely to rise until the company shows significant user growth.

"They've been a public company long enough where they should have been able to increase the user base and fix a lot of the product issues to appeal to a larger audience," said Blake Harper, Topeka Capital Markets analyst.

When Twitter reported its fourth-quarter earnings, Dorsey outlined for the first time his strategy for the company's future. But the plan lacked many details about upcoming product plans and was overshadowed by flat user growth in the quarter, the first time since Twitter went public in 2013.

The anaemic growth reflects an unsettling reality for Twitter: Product changes have not reignited excitement.

In October, Dorsey unveiled Moments, which aims to make it easier for users to follow major events and breaking news, but it has failed to gain traction, analysts say.

Dorsey has also experimented with changing one of Twitter's signature features, by expanding the 140-character limit.

Timeline Tweak

On Wednesday, Twitter announced it changed its timeline -- as its homepage is known -- to show a customized, algorithmic-driven feed of tweets that are thought to be most interesting to each user, rather than the uniform presentation to all of tweets in reverse chronological order.

Read more: Twitter tweaks its timeline to look a bit more like Facebook

Some users have reacted negatively to the idea of radical changes to the way Twitter works, with many taking to the service using the hashtag #RIPTwitter.

Up to now, advertisers have been disappointed with the failure to reignite user growth, though some have expressed tentative optimism about the changes.

"U guys have #riptwitter all wrong .. This is best change to platform ever," tweeted Gary Vaynerchuk, CEO of Vaynermedia, which helps advertisers build campaigns.

In his Wednesday letter to shareholders, Dorsey made clear he is focused on increasing the number of people who use the service. One part of the strategy is intent on making the site easier to use, since analysts say Twitter has trouble keeping new users on the service because of its complexity.

"We have some really weird rules," Dorsey admitted.

Wooing advertisers

Twitter isn't just taking cues from Facebook in terms of the order in which posts appear on our timeline, but also in terms of ads. The app will soon have video ads called First View, like the coca-cola one that plays in theatres to make you consume more of the sugar water. So, next time you see a promoted tweet, don't be surprised if there is a video accompanying it, draining your battery.

(With inputs from Reuters)