Can High Engagement Levels Become Quora’s Competitive Edge?

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Quora has been gaining traction slowly but steadily. The company now has nearly 200 million monthly active users and was valued at $1.8 billion in its most recent funding round in 2017. Quora does not have an established revenue model yet, but it recently opened its platform to advertisers. Our interactive dashboard on Quora’s valuation shows our estimates for Quora’s revenues for the next two years and its valuation (see With A Strong Monetization Platform, How Much Can Quora Be Worth?).

While we do not expect Quora to generate substantial average revenue per user (ARPU) given that it is not focused on monetization at the moment, its ability to engage users for longer can become a key advantage as it looks to generate revenues.

You can change any of our assumptions to arrive at your own estimates for Quora’s revenue potential and valuation.

Time Spent On Social Media Increases With The Number Of Accounts

The time spent by users on social media has been steadily rising. Reports suggest that users spend an average of 2 hours in a day on social media – a figure that has increased from 90 minutes in 2012. Further, this time spent increases with the increased number of social media accounts – meaning a new user will not curtail his or her time on other platforms to use a new platform, instead just spending more time on social media.

Currently, Facebook and YouTube dominate social media engagement levels, with the average time spent by a user per visit on these sites being around 30-40 minutes. As Quora’s popularity increases and its user base expands, Quora can command a similar engagement level.

Quora’s Unique Product Can Lead To Higher Time Spent Per Visit

While data around Quora’s engagement levels is not available (as the company is still establishing its revenue model) the nature of its platform can lead to higher engagement levels.  Answering questions is likely to engage users for longer, and if a user asks a question he or she might spend enough time to review all of the answers received. While the number of answers to every question on Quora varies, a user can expect five to ten answers to each question on average. This would mean spending an average of 20 minutes going through the answers to each question asked, and useful responses can lead to more questions. Users are also likely to review similar questions.

Users spend varying amounts of time on Quora, ranging from an hour to more than 4 hours. Since Quora is focused on the quality of its product (reliable and useful answers to relevant questions), Quora may not have a massive user base but will be able to ensure that users are highly engaged on its platform. This can give a unique opportunity to advertisers to better engage with their customers. Answering customer queries and providing detailed features of products through Quora answers can be another way for brands to engage with customers on the platform – an opportunity not provided by other platforms.

Quora has a unique position in the social media space, and if the company exploits its position effectively it can open up several monetization opportunities, growing the average revenue per user.

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