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The Twitter Ad Model Revealed (What Were You Expecting, a Pony?)

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If you don’t care about Twitter news, you may as well rejoin us next week. Over the next few days, Twitter is going to dominate the airwaves — and it starts tonight. In advance of his keynote at the Ad Age conference on Tuesday (not to mention Twitter’s own Chirp conference on Wednesday), COO Dick Costolo shared details of the company’s highly anticipated new ad platform, Promoted Tweets, with a couple of news outlets.

In the most basic implementation, advertisers will be able to bid on keywords to have their tweets featured in search results. But Twitter says it may also include paid tweets in users’ regular tweet streams too, something that will surely be more controversial. Costolo said the company expects to decide whether to take that step before the end of the year. Here are some of the promoted tweets implementation details, per stories in Ad Age and the New York Times

* Promoted tweets show up based on how large a CPM (cost per thousand) an advertiser pays.
* Twitter is developing a “resonance” metric (apparently not done yet — which makes you wonder what have they been doing these last few months!) that would also take into account how well a tweet fosters engagement and click-throughs.
* Twitter is limiting advertising to only one sponsored tweet per page.
* After the promoted tweets launch on its site, Twitter plans to start syndicating them to Twitter clients.
* Launch advertisers include previously tweeting companies Best Buy, Virgin America, Starbucks and Bravo.
* The actual promoted tweets will disclose that they are ads, and will turn yellow when moused over. But they won’t be separated out on the margins from the other tweets.
* Twitter is considering using targeting factors like subject matter, followers’ interests, and geographic locations to target ads in users’ streams, if they do launch.

Costolo told Ad Age that search volume on Twitter is “huge” but wouldn’t give actual numbers. Promoted Tweets is quite similar to TweetUp, the tweet marketplace launched by Bill Gross on Monday. It is going to be hard for TweetUp to spin this development into a good thing. It also follows other recent moves by Twitter to compete with developers using its platform, for instance buying the maker of Tweetie last week.

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21 Responses to “The Twitter Ad Model Revealed (What Were You Expecting, a Pony?)”

  1. The question is, has the consumer been brainwashed enough yet. You want to comparison shop for a netbook. Do you type in netbooks in Google or use Twitter search? When more people start getting into the habit of searching Twitter to see what people are saying about products before they buy them, this PPC model will thrive.

    But that takes grooming. That’s almost a thing you could run TV spots or web commercials for.

  2. Twitter seems to be making all the wrong noises. Not only are they slowly losing relevance as a marketing tool (I mean other than monitoring and some oh so exalted examples of actual sales)now they go an launch an intrusive ad model (Not on the lines of Facebook they say LOL)

    Also, having seen the first examples, methinks that the only ads which will work are ones where a carrot is dangled. Then again, Twitter marketing was always about carrot dangling.

  3. Google Ads works because the normal user also makes money out of them by putting up advertisements on his own blog or website. This should be a pointer to Twitter on How they can take it forward. If they allow users to choose which companies ads to be put up in their streams and at what frequency, it would make much more sense. The microblog owner has to make money too. Making it PPC or PPM is something which twitter can decide.

  4. Do people really search twitter that much? People monitor their own brand but beyond that, the current search result has no concept of relevance what so ever so I am wondering if people do random search on products and brands they care about. It will be interesting to see how this plays out.