ClickZ met with Twitter’s director of revenue Adam Bain earlier this week for an extensive conversation about the company’s evolving ad product suite, how brands use the platform, and why he believes Twitter engagement beats the competition – including Facebook and standard display ads. Here are excerpts from the discussion.
Why Twitter Beats Facebook
The whole idea is once you’ve got this follower, it is a high bar compared to Facebook. If you like things or fan things on Facebook it’s not as high-bar as on Twitter. On Twitter, once you follow a brand you get messages from that marketer in your stream. [For instance,] look at an auto company that has a lot fewer followers on Twitter than on Facebook – what we’ve heard from them is the amount of engagement that comes off of those sets of users that actually follow a brand is much much higher.
The “like” and what those guys have set up – they’re smart. Yeah, I like this. I like that. I like you. I like everything…. The like is actually a meaningful number. I guess our whole thing is the progression down the funnel… With following, what comes next is that [the] marketer is allowed to have a conversation with you and that relationship goes on until you decide to unfollow that brand. You’re sitting there as a brand intermixed with other meaningful connections in people’s lives.
On Why Twitter Engagement Beats Display
Essentially if you look at what we have had as an industry in display over the last 16 or 17 years, something amazing happened from that point until now, which is absolutely nothing. The market did not move….
Here was the core problem and this is a problem with all online display: There is no engagement with traditional online display, period, end of story. The one engagement number we can look at in online display is click through rate. You’ve got .05 percent engagement rates in terms of CTRs for traditional display. What’s happened over the last few years is this shift in media buying, you’ve got real time bidding, data enhanced targeting and all those things – and maybe it’s brought it from .05 to .06 .
So when we were going to start the platform we wondered aloud, “What is it that makes search ads so engaging and traditional online display not?” We looked at search, we also looked at TV, and we think those two ad platforms work in some way shape or form and the reason is in search you’re asking a question of Google and you get high quality answers back and some of those answers are from marketers. The ad medium is not very different from the content medium there.
In TV, you’ve got a 30-minute story that a content provider is telling…and then you’ve got 30-second stories dispersed through that. The content medium is not that much different from the ad medium there. In online display, it totally is disjointed.
In TV and in search, marketers are rewarded for being good, not just being loud. That’s the same thing that we applied to our platform. In our engagement-priced ads the click is about 80 percent of the engagements. The other 20 percent are made up of retweets, and probably, frankly, that’s an even…stronger signal than a click because it’s someone saying, “I like this content so much that I’m going to retweet this ad to my follower base.” [Engagement pricing is also based on Favorites and @Replies.]
On Retail Advertisers on Twitter
There’s this huge gap between ambient awareness and conversion, and that’s the problem with display – this massive gap between the two. With consumers the world’s a pretty big place and we’re trying with the product to shrink the world so small that it can actually fit in your pocket. With marketers we feel like we’re trying to shrink the funnel and connect the dots better between awareness, engagement, brand favorability, purchase intent, through to conversion – and even what happens after…you make a purchase. One of the things we’d like to do for [the retail] space is connect the dots better on the conversion side.
On Twitter Brand Followers
Between 20 and 40 percent of consumers follow brands overall on Twitter. Usually, that’s within their first set of follows. The mental path is, I come onto Twitter, I’m looking for people I know. I then move to people I wish I knew like celebs or athletes or musicians, and then I move onto brands I’m already associated with or I wish to be associated with.
On Why Political Advertisers Can’t Advertise on Twitter – Yet
Matt Graves, Twitter spokesperson: That’s a category that, you certainly have the 2012 elections coming up, it’s something that will be of interest, but we’ve been very focused on trying to walk before we run as a platform. Before we dip into that category, we want to figure out what works.
We’ve got a guy now in D.C. named Adam Sharp who’s not a sales guy. He’s working directly with politicians and congressmen in D.C. to help them get more out of the platform. For us that’s kind of the first phase – educate the market. From our perspective we’re not in a rush to move blindly into markets we want to move smartly category to category.