What's a Active Twitter User worth thesedays? Average Value is a bad metric for most things

Posted by Marshall Sponder on January 25, 2009 | Link It

I understand, according to Robert Scoble, that a Twitter users are worth 42 bucks each! – (wrote about Twitter Users value briefly this morning at TheAnalyticsGuru.com – still haven’t but FeedBurner on it – btw, but you can look for additional insights from me, on TAG).

On the other hand, I guess Jeremiah thinks Twitter’s Valuation, $73.52 an Active User?

[qwidget question="55"]

I think the differences in valuation have to do with the actual number of Twitter Users – and I’m not sure why Twitter thinks it’s a problem to give out that number  – but it appears, they do, according to Jeremiah -

Last week, when I visited the smooth Twitter offices in SF, I asked them about official registered users and they commented “they don’t give out those numbers”, as it would benefit others more than them. So, I’ll average it around 5mm total registered users. I trust the HP labs research on Twitter (met with Bernardo two weeks ago) and their data from a significant sample size shows that only 68% of users return.

This would suggest that 3,400,000 actual users, which if you diveded into the supposed valuation of $250mm would result in the active (people who actually return) users actual worth $73.52. Scobleizer suggests it’s $42 but I think it’s near double that –as you have to take into account those that won’t participate.

But here’s the thing – half of the accounts on Twitter are just spam, as far as I’m concerned, and aren’t worth anything – and aren’t even active much, and are not even worth a cent, much less $73.52.

But what’s an “Average Twitter User” really worth?  I think there’s a bunch that matter a whole lot more – would’t Scoble’s account be worth, say 100K?   It could be – who’s to say?

I found some pretty good visualizations over at Neoformix

The above StreamGraph illustrates the distribution of the most interesting capitolized words in the StatBot dataset of all the updates for the top 100 twitter users.  According to Jeff Clark:

The most ‘interesting’ words in this data are primarily product, technology, or technology event names with the exceptions of ‘Scoble’ and ‘Obama‘. This isn’t surprising since the top twitter users are early-adopters interested in technology. I was a bit surprised at the large volume for Seesmic but discovered that it is a company founded by Loic Le Meur, the 6th top twitter user.

Ha, ha – little did Jeff know how much Twitter is dominated by a few people – maybe a 100, but what’s new about that?

And Jeff Clark’s Obama Twitter Word Map

is really cool – I hope he updates it regularly – and then animates it!  That would be interesting visualization – interesting Art, too.

pe="rect" coords="260,536,292,544" href="http://search.twitter.com/search?q=obama+promises"> shape="rect" coords="401,311,427,319" href="http://search.twitter.com/search?q=obama+thought">

This Twitter word map is constructed from tweets containing ‘obama’ during January 1-21, 2009. Higher frequency words are larger and you can click on any word to jump to Twitter Search and see the matching tweets. This is done using a simple HTML image map I generate along with the image. The base image is derived from the iconic Hope/Progress image designed by Shepard Fairey.

In fact, making decisions using Average Value, is really tricky, and I don’t recommend it – I think it makes sense to look at Averages for planning purposes, but not for Valuation – even if it’s tempting to do so.

Besides, if I want to accept a Valuation for a Twitter User – I’d rather go with 42 dollars -  the Answer to Life, the Universe, and Everything (42) is a better number.

Seriously, say the GDP for the United States is, say $15 Trillion Dollars per year (right now) and there’s something like 300 Million US Citizens (not counting 20 or 30 million undocumented aliens) – wouldn’t that make each person worth about 50,000 a year?

For planning purposes, I can see that maybe, we’d use that number to say that Government Spending, all things being equal, ought to create or support the spending of that much money from Government and Private Sectors, on each individual – but…. do think anywhere near that kind of money is being spent (and my math is probably wrong or fuzzy – so I’m talking more about the idea of using averages to make a decision than the value being right or not, though that has it’s place, too).

At the end of the day, the Government and the Private Sector don’t spend anywhere near that kind of money on the average citizen – to the average value, here, doen’t translate to any kind of action.

Getting back to Twitter – if the average value of a person on Twitter really is 42 dollars (or whatever it is) how does Twitter deliver that value – how can they improve the service (which will increase their valuation, btw).

But even here, we run into a problem with Average Valuation per User – let’s say the entire US gets on Twitter (something that’ll never happen), and they get a bit more money – but the average value of a user goes down to under a buck, or a few cents – does that mean a user is worth any less?

What do you think?  I put a QWidget above  if you want to comment – or you can make a regular comment in WP, if you want.

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