Tweeter Tiptoes into Advertising - Opportunity for Businesses?

By announcing its advertising model called Promoted Tweets, Twitter officially moved to the paid advertising world. So have a look at its features, operation and benefits to corporations.

What is it?

Unlike traditional PPC advertising like Google AdWords, Twitter’s pricing strategy involves bidding on keywords based on one thousand views. This allows marketers to place their 140-character message at the top of the estimated 50 million tweets displayed on the website each day.

Promoted Tweets will allow advertisers to buy keywords to link to their ads, which will show up when users search for those keywords and later in users newsfeeds. Twitter promises they will be targeted for relevancy. The ads will also be monitored for resonance, which is determined by factors such as the number of retweets. replies, clicks on the links, etc. Promoted Tweets with low resonance will be dropped.

How does it work?

The ads will let businesses insert themselves into the stream of real-time conversation on Twitter to ensure their posts do not get buried in the flow. Starbucks, for instance, often publishes Twitter posts about its promotions, like free pastries. But the messages quickly get lost in the thousands of posts from users who happen to mention meeting at Starbucks.

The ads will also be a way for companies to enter the conversation when it turns negative. Several companies have created tools to measure sentiment on Twitter, but until now, businesses can do little with that information. Even if they write a post in response, it also quickly gets lost in a sea of complaints.

At first, companies will pay per thousand people who see promoted posts. Once Twitter figures out how people interact with the posts, it will figure out alternate ways to charge advertisers. In the next phase of Twitter’s revenue plan, it will show promoted posts in a user’s Twitter stream, even if a user did not perform a search and does not follow the advertiser. For example, if someone has been following people who write about travel, they could see a promoted post from Virgin America on holiday fare discounts.

How do companies approach the new model?

Corporate marketers can use promoted tweets to accomplish a variety of goals such as receiving customer input to streamline product improvement or to start a conversation which leads to greater brand recognition. It helps to enhance the communications that companies are already having with customers on Twitter. Since marketers do not pay for re-tweeted advertisements, this program gives marketers the potential to reach a large audience.

In order to tailor advertising to Twitter, marketers need to step up to the plate and take it upon themselves to create value-driven Twitter ads. Advertisers need to sit down and think about how content is used and shared on Twitter, and, importantly, what makes a Tweet (paid or not) successful.

However, let's see:

- The acceptance of Twitter’s users with the new ad program

- The balance between user experience and website benefit

- The effectiveness if the model in execution

(Sources: NYtimes, Twitter's Blog, Mashable, E-commerce Services Suite)

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