What the Changes in Twitter’s URL Shortener Mean for Bitly

by Scott - 1 Comment

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This post originally appeared on Venturebent

Twitter has had a native URL shortener for some time, but it wasn’t until recently that they have begun automatically shortening URLs and link-wrapping those over 20 characters with a t.co URL. Alot of people are excited about these changes, including brands and media due to the condensed traffic source via the t.co link-wrapping. One service that has to be less thrilled about these changes is Bitly.

Bitly has been the dominate force amongst URL shorteners which has afforded them access to the real-time data kingdom. Sitting at the helm of real-time information sharing enables Bitly to derive incredible insights at both an aggregate and individual level. The applications to leveraging all the real-time data sharing on the web are endless, but one that particularly excites me is the ability to identify and understand broader web trends prior to anyone else. In short, I think the real opportunities for Bitly stretch far beyond link sharing analytics. But the amazing realm of opportunities Bitly possesses are entirely contingent upon the use of their URL shortener. So where does Bitly stand after the most recent changes? Let’s start with some questions.

Where is Bitly being used?

Bitly is used across many platforms which means that they have access to data extending beyond the Twitter eco-system. I’m sure Bitly points to this position as one reason they stand a chance as more and more platforms fill the holes they once occupied by integrating increasingly robust URL shorteners. And yes, the analytics services accompanying them will be here soon.

According to John Borthwick, last year less than 1% of Bitly links were being encoded on Twitter.com after their partnership ceased. I think this statistic misleads readers about how important the Twitter ecosystem is for Bitly. This statistic accounts for links that were being shortened on the site, not the total percentage of Bitly links being shared across the platform. What percentage of the Bitly pie are links shared on Twitter? From this, what percentage of users  were motivated to use Bitly out of pure convenience? I can’t find this information, but would love to know. If Twitter convenience truly does account for a large percentage of Bitly usage, they may be in some hot water…which leads me to my next question.

Who uses Bitly and why are they using it?

Bitly does two things really well on twitter – it enables me to squeeze a link within a tweet and provides rich analytics for tracking the interactions with that link. I expect that users that don’t care for the analytics will migrate to Twitter’s automatic URL shortener (t.co) because of its convenience. Conversely, Bitly users who derive value from the analytics will probably continue to use the service until Twitter reveals their analytics product. Whether these users choose to switch to Twitter’s native URL shortener once this becomes available will depend on a few things: how the product offering compares to Bitly, pricing, tracking habits across multiple platforms, and how intuitive the user experience is (people hate changing established workflows in the absence of a far superior offering).

But this begs the question – who is the demographic that is closely monitoring link analytics and doing so across multiple platforms? I’d venture a guess its primarily brands, online marketers/bloggers, and highly engaged tech adopters. To reiterate, in the near term I predict Bitly users who fall into these categories will continue to use the service, but I imagine that we will slowly see the more passive/social Twitter users move their native automatic shortener. For the record, I’m already a convert.

So where does this leave Bitly?

For starters, it means they must continue to innovate on their analytics offering because they have to assume that Twitter’s analytics package is on the horizon. Fortunately, they’re cross-platform…so they got that going for them. The less obvious question mark surrounds Bitly’s pulse on aggregate level trends.  As I mentioned earlier, their positioning at the beachhead of real-time information sharing enables them to derive insight into the real-time web’s broader trends. If the advent of Twitter’s automatic URL shortener does leave Bitly with a userbase composed mainly of brands, marketers, and techies, their aggregate data insight will be much less compelling; the pulse of often self-interested link publishers is likely different than that of the masses. Lastly, because Twitter is now indexing a large portion of Bitly URLs along with most others through the t.co wrapping, they have greater data sets to work with. Thus, they have the ability to offer superior data products solely for the Twitter platform. Did someone say monetization?

This post is full of assumptions, but it’s always fun to speculate. I strongly believe moving forward the company that holds the keys to the real-time data kingdom has the ability to power some incredible products far superior than link sharing analytics. These recent changes in Twitter’s URL shortener have definitely been a blow to Bitly. They must find ways to improve their product in order to retain the users who give them access to their critical mass of real-time data. Otherwise I fear they will only be a cross-platform analytics product who may never be able to seize their greatest opportunities.

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