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Twitter Finally Joins the Mix With Its Own Ad Offering

  |  April 20, 2010   |  Comments

A look at what Twitter's new ad offering, Promoted Tweets, is all about, how it will fare, and whether or not it will have an adverse user reaction?

Last week, Twitter (finally) revealed its first real monetization plans: an advertising offering it's dubbed, "Promoted Tweets." I had planned to write on a different topic for this week's column, but having authored a new book on Twitter marketing, I feel compelled to change course. I also feel compelled to comment upon what's beginning to feel like weekly schoolyard one-upmanship between Google, Apple, Twitter, and Facebook. Don't get me wrong. I'm glad to see innovations and vibrancy in our space. I'm just beginning to wonder how much Kool-Aid we're all supposed to drink. But enough of this tinge of cynicism: on to more Twitter advertising!

Latest Twitter Stats

Twitter has its share of naysayers, but at its recent developers conference, Chirp, Twitter co-founder Biz Stone divulged some stats that show it's certainly no lightweight player:

  • Close to 106 million registered users
  • 300,000 new users join each day, 60 percent of which are from outside the U.S.
  • 180 million unique visitors a month
  • 600 million search queries per day
  • 75 percent of traffic comes from outside of Twitter.com (via third-party apps)
  • 60 percent of all tweets come from third-party applications
  • 37 percent of active Twitter users tweet through their phones
  • 3 billion requests per day are processed through Twitter's API
  • Twitter has grown from 25 employees last year to 175 this year

Promoted Tweets in a Nutshell

Twitter's Promoted Tweets will look and function like all other tweets, i.e., limited to 140 characters, except they will be flagged at the bottom as "Promoted by [Name of Advertiser]."

Of course, we would expect Promoted Tweets to have blatant offers and ad messages...not that users and brands aren't already crafting such tweets.

At first, Promoted Tweets will appear only in Twitter Search results, at the top of the page, with a limit of one Promoted Tweet per page. (Ironically, as of this writing Twitter doesn't seem to be running its own Promoted Tweets within Twitter Search when you search for "Promoted Tweets.")

Twitter intends to track and analyze the value and staying power of an ad with a "Resonance Score," taking into account such factors as user retweets, favoriting, and replies. Twitter says it will take down ads that don't have a high enough score. (We wonder if Twitter has also considered a thumbs-up/thumbs-down user vote to help determine the Resonance Score?)

At Promoted Tweets' formal unveiling at last week's Ad Age Digital Conference, COO Dick Costolo revealed that ad data and analytics will be available to advertisers in real time, but the dashboard, as well as the mechanics for campaign purchasing and set-up is still shrouded in mystery. Beta advertisers seem to have been hand-selected, and all we know about pricing is that it's currently on a CPM (define) basis.

Presumably, if this grand experiment works, Twitter will soon open itself up to other advertisers. Eventually, too, Twitter says that Promoted Tweets will be open to third-party Twitter clients (with speculation that a possible revenue share deal would be worked out) and then later will appear in-stream in users' timelines.

My Reaction

I'm somewhat surprised that Twitter's first move into monetization is Promoted Tweets. Not that I don't think there's money to be made by Twitter this way (heck, look at what Google's been able to accomplish), but I'd have thought Twitter would first pursue a non-advertising route, particularly because of adverse user reaction.

Also, the real-time nature of Twitter makes relevant advertising a high-maintenance play. This might make managing Promoted Tweets more like paid search campaigns than display ones. Into whose lap will campaign management responsibility fall: media's or search's?

Speaking of search, Costolo admitted that Twitter's search is but a fraction of its traffic (read: low ad inventory). My experience with Twitter Search is that while it can be useful to datamine, it's far from an easy or perfect science, so I'm less apt to use it when I have to find information, particularly any information beyond the most recent few days or so.

Combine this with Google's recent addition of Twitter's archive to its "replay search," which is integrated with live, real-time tweets simultaneously, and one has to wonder if Google started serving advertising here, who's going to come ahead at monetizing tweet searches. (Check out this Google "replay" for Starbucks to get a comparative value. Notice on Google you can easily move your timeline view and go all the way back to February 2010 if you wanted to. Twitter Search doesn't make that possible.)

Will Promoted Tweets make my media plan one day? Maybe, but it'll probably be just a sliver for a long while.

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ABOUT THE AUTHOR

Hollis Thomases

A highly driven subject matter expert with a thirst for knowledge, an unbridled sense of curiosity, and a passion to deliver unbiased, simplified information and advice so businesses can make better decisions about how to spend their dollars and resources, multiple award-winning entrepreneur Hollis Thomases (@hollisthomases) is a sole practitioner and digital ad/marketing "gatekeeper." Her 16 years working in, analyzing, and writing about the digital industry make Hollis uniquely qualified to navigate the fast-changing digital landscape. Her client experience includes such verticals as Travel/Tourism/Destination Marketing, Retail & Consumer Brands, Health & Wellness, Hi-Tech, and Higher Education. In 1998, Hollis Thomases founded her first company, Web Ad.vantage, a provider of strategic digital marketing and advertising service solutions for such companies as Nokia USA, Nature Made Vitamins, Johns Hopkins University, ENDO Pharmaceuticals, and Visit Baltimore. Hollis has been an regular expert columnist with Inc.com, and ClickZ and authored the book Twitter Marketing: An Hour a Day, published by John Wiley & Sons. Hollis also frequently speaks at industry conferences and association events.

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