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Is Twitter a Fad? Nielsen Says It Just Might Be

Twitter
Twitter certainly has all the trapping of an Internet fad. Exorbitant media coverage. Celebrity endorsement. Ballooning traffic numbers. And, according to a new analysis from Nielsen Online, a weak retention rate.

By Nielsen's reckoning, more than 60 percent of Twitter users in a given month don't return to the site the following month.

Given the outsize hype surrounding the microblogging service, it's easy to imagine uninitiated Internet users setting up a Twitter account to see what all the fuss is about, sending off a tweet or two, and then, their curiosity satisfied, moving on to other, less diversionary online activities.

And there has been no shortage of hype. Celebrities are using the service to connect to their fans (many through ghost-Twitterers). TV talk shows are increasingly wrapping their broadcasts with an appeal to viewers to "follow us on Twitter."

Most recently, Oprah Winfrey made her inauspicious debut on the site, sending out her first tweet in embarrassingly gauche all caps.

Less than two weeks after creating her account, Oprah has amassed nearly 700,000 followers. The queen of daytime TV hopped on the Twitter bandwagon April 17, when she had CEO Evan Williams and celebrity Twitter enthusiast Ashton Kutcher on her show. Kutcher was fresh from his victory over CNN in the race to 1 million Twitter followers.

Add to that the frenzy of media coverage trying to pin down or plump up the phenomenon of instant updates and Web-wide messages of 140 characters or fewer, and Twitter is clearly basking in the klieg lights of celebrity.

But Nielsen's look at the site's retention rate includes what could be a worrisome comparison for Twitter's staying power. Nielsen Online Vice President David Martin pointed to Facebook and MySpace at comparable stages in their development. Both enjoyed retention rates twice that of Twitter's, and continue to see user loyalty increase.

"To be clear, a high retention rate doesn't guarantee a massive audience, but it is a prerequisite," Martin wrote in a blog post.

Martin noted that for most of the year preceding Oprah's appearance on the site, Twitter's retention rates were around 30 percent. As of this writing, Oprah had not posted a message on the site in five days.

Martin's takeaway is that the eye-popping surges in the site's membership (up 100 percent since last month) won't sustain it unless more of those users start to find the service compelling enough to keep coming back.

Concerns about the engagement of Twitter users add another wrinkle to the company's talk about carving out a business model through some form of tiered service aimed at businesses.

"Twitter has enjoyed a nice ride over the last few months, but it will not be able to sustain its meteoric rise without establishing a higher level of user loyalty," Martin said. "Frankly, if Oprah can't accomplish that, I'm not sure who can."