Written by Norman Isaac Mwambazi

Tech Stocks: The difference between Twitter, Facebook, and Instagram

When you mention the word social media, the three social media networks Facebook, Twitter, and Instagram (which is owned by …

When you mention the word social media, the three social media networks Facebook, Twitter, and Instagram (which is owned by Facebook) pop up in the minds of almost everyone. These are the most used and most successful social media brands that people use for different purposes which include staying connected with loved ones, staying in the know of what is happening in current affairs, sports, and entertainment, among others, as well as businesses staying in contact with clients and customers.  

The three sites appeal to different demographics. Facebook, which by far boasts of the most users, has broad appeal across ages. Instagram, which is mostly photo-sharing pp has relatively more younger users, while the affluent college graduates favouring Twitter.

Facebook

Of the 7.6 billion people on the planet, 2.5 billion of them use Facebook at least once per month. This is nearly a third of the world’s population. With this huge number of users connected over a single social network, it is safe to say that everyone is Facebook’s target market.

At the end of 2019, Facebook had 248 million monthly active users in the United States and Canada. To break this down for you, about 68% of all adults in the U.S. adults have a Facebook account although digging deeper into the demographics of the users presents some slight differences.

74% of adult women are Facebook users, compared with 62% of all adult men and just like all social media; the Facebook platform is more popular with younger adults. Roughly, 80% of 18- to 49-year-olds have an account but this does not mean older Americans are not represented on the social network. 65% and 41% of those in the 50 to 64 and 65 and older age group are on Facebook respectively.

The data shows that college graduates are more likely to use Facebook than high school graduates, as are those living in rural parts of America. It is also worth noting that their ethnic background does not distinguish Facebook users and that almost everyone who uses social media as a means of connection uses Facebook.

IPO

In May 2012, Facebook went public in what was one of the most anticipated Initial Public Offering (IPO) in financial history. At the time, Facebook was valued at $104 billion, which was the third-largest IPO in the U.S. at the time. Facebook now has a market capitalisation of $872.68 billion and its stock price is $307.10 per share.

Business

Facebook’s primary source of revenue is targeted digital advertising on its platform. In 2019, the company reported $70.7 billion in revenue up significantly from $55.84 billion 10 2018. However, the rise in costs led to the falling of earnings from $22.11 billion previously to $18.48.

Facebooks largest shareholder is founder, chair, and CEO Mark Zuckerberg, who, as of April 2019, held 12.17 million Class A shares and 365.72 million Class B giving him 53% voting power over the company.

After going public in 2012, Facebook acquired the photo and video-sharing app Instagram that same year paying roughly $1 billion in cash and stock. This was followed by an even bigger acquisition of messaging service WhatsApp for $19 billion in 2014. This deal appreciated $22 billion in value due to a rise in Facebook’s shares.

Twitter

The micro-blogging service has over 67 million users in the U.S. About 24% of adult Americans say they have a Twitter account. Men and women represent Twitter users nearly equally. Like with Facebook, users skew younger, especially among 18- to 24-year-olds.

In this age group, 45% report they use Twitter. This compares to 33% for the 25 to 29 age group, 27% for the 30 to 49 age group, and 19% for the 50 to 64 age group. High school graduates are less likely to use Twitter compared to college graduates. Its users also tend to be more affluent and live in a city.

IPO

Twitter Inc. went public in November 2013 and achieved a valuation of $25 billion on its first trading day. In 2019, Twitter reported $3.46 billion in revenue, up from $3.04 billion the previous year. Twitter primarily gets its revenue from promoted tweets, while data licensing is its other revenue stream.

Co-founder, CEO, and company director Jack Dorsey holds 18 million shares which account for 2.34% of the company. Twitter has a market capitalisation of $52.47 billion and its stock is currently trading at $65.70 per share.

Instagram

Instagram is the ideal social media service for young people who want to share bits of their daily life in photos and videos. This is why it is especially popular among 18- to 24-year-olds. In this age group, 71% say they have an Instagram account.

However, usage is significantly lower for older Americans. In the 25 to 29 age group, just 54% have an account. Only 40% of Americans in the 30-49 age group report using Instagram, and the figure is 21% for those 50 to 64 years old.

Facebook, the parent company of Instagram says 1 billion users are active every month and 500 million use Instagram every day. About 47% of Facebook users also report using Instagram. More women than men say they have an account: 39% to 30%. Instagram users are typically college-educated, urban, and more affluent.

Business

As mentioned earlier, Facebook bought Instagram in 2012 for $1 billion that was paid in cash and stock. The purchase raised eyebrows and questions were asked whether it made business sense for Facebook because by then, Instagram was just two years into operation and did not have any significant revenue.

It has proved to make a lot of sense because fast forward to 2018, Instagram was estimated to be worth $100 billion by Bloomberg analysts, with revenue surpassing $10 billion.

PS: Stock prices quoted in this article can change anytime.