Almost two-and-a-half years after its launch, Reality Social is struggling to hold onto its small U.S. consumer base, in accordance with new information on the microblogging platform launched by former President Donald Trump‘s media firm.
Up to now in Could, U.S. each day visits to Reality Social have dropped greater than 21% from April, and greater than 35% in comparison with March, in accordance with digital intelligence platform Similarweb.
The location’s common variety of month-to-month visits over the previous yr — simply over 4 million from Could 2023 to April 2024 — plummeted greater than 39% from the prior 12-month interval, from Could 2022 to April 2023, Similarweb reported.
The site visitors has declined whilst Trump — essentially the most outstanding Reality Social consumer and the bulk shareholder of its mum or dad firm, Trump Media — has saturated the nationwide information with protection of his legal trial and White Home bid.
And whereas the app noticed a surge in guests within the lead-up to Trump Media’s public buying and selling debut in March, Similarweb’s most up-to-date information present that these beneficial properties have already been erased.
The consumer and engagement information from Similarweb and two different information corporations, collected and analyzed solely for CNBC, gives a glimpse into how Trump Media’s flagship product is growing — one which the corporate itself has but to offer.
The corporate claims it doesn’t monitor key indicators that social media platforms historically use to observe their efficiency. These embrace metrics like a website’s lively consumer accounts and its each day and month-to-month customer numbers, in addition to its income per consumer and advert impressions.
Trump Media says it believes monitoring these stats “may not align with the most effective pursuits” of the corporate or its stockholders, in accordance with its most up-to-date submitting with the Securities and Alternate Fee.
The corporate additionally mentioned it “might by no means acquire, monitor, or report any or sure key working metrics.”
CNBC reached out to Trump Media for touch upon the corporations’ findings, and requested if it might present any information of its personal.
“Why would we touch upon a pretend information community reporting on pretend analyses?” the corporate mentioned via a spokesperson.
However the brand new analyses might be warning indicators for Trump Media, whose enterprise relies upon largely on rising its consumer base.
“If you cannot show that you’ve got a sizeable, lively, engaged, rising viewers, I do not perceive the way you create a profitable ad-supported social media enterprise,” mentioned David Carr, Similarweb’s editor of insights, information and analysis, in an interview.
Trump Media depends totally on advert gross sales for its income, and discloses in its SEC filings {that a} decline in consumer engagement might damage its enterprise by making Reality Social much less enticing to advertisers.
The information corporations’ findings might additionally harden Wall Road analysts’ view of the corporate as a “meme inventory” whose sky-high market capitalization is untethered to its enterprise fundamentals.
“We mainly do not see something in these digital indicators that will clarify why the valuation is as excessive as it’s,” Carr mentioned.
Trump Media on Tuesday reported a first-quarter web lack of almost $328 million on revenues of about $771,000, most of which got here from promoting.
Nonetheless, as of Friday, the corporate had a market cap of barely greater than $8 billion.
The inventory closed on Friday at $45.81 per share, which is roughly in the midst of the big selection of share costs, from a low of round $22 per share to a excessive of round $70, that TMTG shares have traded at because the firm went public in March.
A single surge
Reality Social’s month-to-month lively consumer numbers declined considerably within the U.S. within the ultimate months of 2023, three completely different information corporations advised CNBC.
However the platform’s site visitors rebounded within the first quarter of this yr, as Trump Media closed in on a deal permitting it to begin buying and selling on the Nasdaq beneath the ticker DJT.
Similarweb tallied 781,954 lively iOS and Android customers on Reality Social within the U.S. that month, a greater than 58% surge from February. GWS Amplify provided a fair rosier evaluation, calculating that Reality Social’s month-to-month consumer numbers hit a brand new peak of 1.4 million in March, which carried over into April.
Information of Trump Media & Expertise Group public buying and selling is seen on tv screens on the Nasdaq Market in New York Metropolis on March 26, 2024.
Michael M. Santiago | Getty Pictures
Knowledge agency Sensor Tower, in the meantime, calculated that the social media platform’s U.S. month-to-month lively consumer stage within the first quarter of 2024 rose 10% yr over yr.
However all three analysts linked that rise to the heavy press protection surrounding Trump Media’s public merger and its extremely risky buying and selling kickoff, when the inventory rocketed up as a lot as 50%.
That meme-fueled frenzy appears unlikely to determine a long-term achieve in site visitors: Within the four-week interval ending Could 19, as an illustration, each day lively U.S. Reality Social customers have been down 19.7% yr over yr, in accordance with Similarweb.
Reality Social’s headwinds
Reality Social additionally faces two main obstacles to constructing an engaged consumer base, in accordance with GWS Amplify.
The primary is a retention downside. Reality Social customers on common test the location fewer than two days every week — falling behind apps like Fb, X, TikTok, Reddit and Pinterest.
Reality Social customers additionally clock fewer minutes of engagement on the platform that do the customers of different social media networks. The overwhelming majority of Reality Social customers, 87%, additionally use Fb. One other 51% are additionally on X, GWS Amplify reported.
“In comparison with different social media platforms, Reality Social customers are accessing the app a lot much less steadily and are spending a lot much less time on it per session,” the agency’s CEO, Dr. Paul Carter, advised CNBC in an electronic mail.
“That can have a much bigger affect on the prospects for Reality than any media limelight,” Carter mentioned.
Former US President and Republican presidential candidate Donald Trump speaks throughout a marketing campaign rally within the South Bronx in New York Metropolis on Could 23, 2024.
Jim Watson | AFP | Getty Pictures
He added {that a} future decline in Reality Social’s numbers “will probably be as a result of the platform has failed to have interaction customers in the way in which that essentially the most profitable social media firms – TikTok most prominently – have mastered.”
The second downside is that Reality Social would not supply something to set it aside from greater microblogging websites, particularly X, which it carefully resembles.
Trump Media says it’s centered on including new options to Reality Social, together with stay TV streaming, in accordance with its newest earnings report.
For now, essentially the most distinctive characteristic of Reality Social is Trump himself, who makes use of the app usually and sometimes makes information in his posts.
But Trump’s presence on Reality Social alone has not been sufficient to attract customers away from its rivals, nor has the wall-to-wall nationwide press protection of Trump’s legal trial and his marketing campaign to defeat President Joe Biden.
“It simply hasn’t occurred,” Carr mentioned.
— NBC Information’ Rob Wile and CNBC’s Gabriel Cortes contributed to this report.
