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Is Twitter worth its reported $1 billion valuation? The verdict’s still out on that. But independent research keeps coming in that details h…

Twitter logo map
photo: Boris Veldhuizen van Zanten

Is Twitter worth its reported $1 billion valuation? The verdict’s still out on that. But independent research keeps coming in that details how valuable the social utility’s users could potentially be to advertisers. The latest, from tech and media research firm Interpret, shows that Twitter users are twice as likely to engage with brands — in multiple ways — than other social network users.

Interpret surveyed over 9,200 internet users in August, finding that roughly 24 percent of the respondents that used Twitter, reviewed or rated products online; just 12 percent of people that used other social nets — but not Twitter — said the same. Twitter users were also more likely to visit company profiles (20 percent) than non-Twitter users (11 percent), and twice as likely to click on ads or sponsored links (20 percent vs. 9 percent).

The higher rates of engagement with brands could stem from a number of factors. First, people aren’t spending as much time doing activities (commenting on photos, chatting, playing games) on Twitter, so they could be more apt to click on an ad that would take them away from the site. In contrast, it’s been proven that most ads on Facebook, MySpace and other social networks, fail to garner high click-throughs or other interactions, simply because users don’t want to have their experience interrupted.

Twitter is also built to be an information stream, not a destination; users share bit.ly links that generate over a billion clicks each month, and also mention specific brands or products in roughly 20 percent of their updates.

But what’s still up in the air — and likely an even more pressing issue now, with a potential $100 million investment on the horizon — is whether Twitter can turn these advertising-friendly users into revenue. (The startup has some plans for ads, but is more focused on making money from premium accounts). Still, companies like Glam Media, 12seconds and others have already figured out how to do it, and largely without splitting any of the revenue with Twitter itself.

  1. Twitter is a micro-blogging system. It is NOT a social network and it is NOT a real-time search engine. It's a blogging tool.

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  2. @jenkins I think your take on Twitter is a bit short-sighted. Twitter can be all of those things. The most powerful thing about it is that REAL people use it, in spite of all the bots and ads. If people use it, then it really can evolve into anything the community demands. The original purpose of the software itself becomes irrelevant. And, considering I used the @ symbol to address you, Twitter has also created several social memes (RT, etc.).

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  3. Twitter is fully capable of being a half trillion dollar valuation. However, I believe someone else will take that half trillion because Twitter is resting on laurels believing no one can come after them…

    I'm protesting the headline of this article because it is uneducated and misleading. To keep referring social marketing as "advertising" need to stop, honestly.

    As the article stated <i>"Twitter users are twice as likely to engage with brands"</i> clearly shows this is not advertising.

    Advertising is about impressions where social marketing is about engagement.

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  4. agreed with Jenkins, this isnt a real social network, its a blogging tool. there is so much noise on twitter that its impossible to really have that true 2 way communcation channel, its just a way one shout, so it's not all that social IMO.

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  5. Twitter is populated by advertising, marketing and freshly monickered social media mavens/experts/yahoos (no relation). So, yes, they all check each other out in this incestuous pool of Brand exposure and hoopla. That's the only reason there is the appearance that Twitter Users care about "ads."

    Real people don't Tweet. They may have accounts, but, they don't participate and have already abandoned the platform. Does anyone remember 2nd Life? Will anyone remember Twitter?

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  6. Staci D. Kramer Friday, September 25, 2009

    @Dan what's striking about twitter compared with second life is the number of "real people" who are using it — not just those of us who live in an echo chamber — whether it's to follow/chat with others about sports or project runway, keep track of local events, share info, feel articially close to Ryan Seacrest, connect with brand managers, and a number of other uses. That doesn't mean it's here to stay but maybe it's more Compuserve, which lasted far longer than anyone imagined and paved the way for what we do now online, not fad.

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  7. Lots of real people also use IM and email. Twitter is a blogging service, no , wait, it's real-time search, no, wait, it's a social network…

    The truth is that no one really knows how this plays out but I've seen plenty of web fads come and go and this one looks more and more like one every day.

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  8. what do you mean "it's not a real-time search engine, jenkins?

    heck, i've tracked the soon-to-launch espndallas nearly all week using the search feature at twitter because goog results are from years ago rather than minutes/hours ago.

    heck, i learned that espn raided the dallas morning news' sports dept. of 3 or 4 of their main sports writers last week via twitter search… following that trail of crumbs one of them says he can "not confirm or deny" though.

    we'll see come monday.

    i also picked up this soon-to-be meme there "LOCAL is the new NATIONAL".

    sweet!

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  9. I'm not sure about the validity of the valuation, but it's clear that people — in media, tech, but also other industries like accounting and healthcare — are using Twitter to share and receive info.

    Some of that info is about brands or products (as is the case with offline conversations). The companies that figure out how to use Twitter to get their message across, build relationships and even generate leads — whether they pay for ads or not — are just adding another tool to what should be a diverse marketing strategy.

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  10. Whether Twitter has staying power or not, businesses need to develope their marketing strategies to include social media in order to protect and promote their brand.

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