“Promoted Tweets” Twitter Ads a Game Changer? Oh Yeah

By on April 14, 2010

twitterbirdongoldeneggAs you might have heard, Twitter has finally initiated a revenue model.  Earlier this week, they rolled out “Promoted Tweets”, their new advertising program.  What does this mean for Twitter and their millions of loyal users?  To some extent, it probably means a shift in the atmosphere on Twitter, but they’re taking some interesting steps to ensure it doesn’t shake things up too much.

The Promoted Tweets Program

For now, Twitter’s new advertising program only displays promoted tweets when users search for keywords that advertisers have purchased to link to their ads.  The sponsored posts show at the top spot in the search results, just as with any sponsored search engine results.

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In time, Twitter plans to show promoted tweets in the stream of posts, based on their relevancy to a particular user.  Yes, that means you’ll see sponsored posts even from companies you’re not following, and yes, that is significant.  If it’s done right, and few doubt that Twitter will do it right, this could be an overall positive thing, even though it’s certainly a change in what we’re used to seeing on the site.

An indication that they will in fact make this change a positive can be found in the way they’ll decide which ads you see.  When ads are posted, Twitter plans to measure what they call “resonance,” which takes into account nine factors, including the number of people who saw the post, the number of people who replied to it or passed it on to their followers, and the number of people who clicked on links.  If a post doesn’t reach a certain resonance score, Twitter will no longer show it as a promoted post. That means the company will not have to pay for it, and users won’t see ads they don’t find useful.

The reason this is important is that it keeps advertisers accountable.  They have to come up with ads that are interesting, compelling, and, most importantly, relevant to your needs.  If they’re not adding to the conversation in a meaningful way, their ads won’t just be ineffective, they’ll be pulled altogether.  This is even better than the existing stream of garbage some amateur marketers are sending through the stream now.

Reactions

If you do a search for “sponsored tweets” or “promoted tweets” on Twitter, you’ll find a wide range of reactions to this newly announced program.  Here are a few that are representative of the overall feelings out there:

  • @jaymeslangrehr If Twitter wants to make $, why not just slap in contextual ads like Facebook & call it a day instead of selling sponsored tweets?
  • @andrewspong: To me, ‘promoted tweets’ are the antithesis of open convos
  • @vagabonn I don’t mind promoted tweets actually. Sometimes they might be relevant and so far they don’t seem too obnoxious. Twitter’s gotta make $$$
  • @cmsexpo Sponsored Tweets = Twitter finally gets their business model, and we get marketed to bloody hell.
  • @LukasC hurrah! Promoted Tweets should increase in visibility over time. Just getting started.
  • @marcinators Curious about the launch of Promoted Tweets – wary of effects on our tweeting experience
  • @JadedSkeptic Sponsored tweets. A bold progressive idea.
  • @rymccoleman I think promoted tweets are an interesting idea, but the promoted tweet shouldn’t stay at the top of the search when you refresh.

A few reactions were very strong, saying that if Twitter moves forward with their promoted tweets plan, people will jump ship and say good bye to Twitter forever.  The question is, how long did people expect the company to continue without generating revenue?  And without charging users for an account, how else should a revenue model play out?  The suggestion that ads should just be placed alongside the stream, as on Facebook, isn’t much different.  The ads are on your page, and whether they’re on the side or integrated into your stream, you have the option of reading or ignoring them.  The preferable part about having them as part of your stream, again, is that this model measures an ad’s relevance, which is good for marketers and consumers.

Bottom line is that the model has been rolled out, and it’s likely here to stay.  As information is made available about pricing and other specifics, we’ll see if the program is for everyone or just the big players, but it’s likely that there will be some sort of opportunity for everyone.  Twitter has proven to be a sensible company to date, and they’re liable to remain such.

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Matthew Toren

About Matthew Toren

Matthew Toren is a serial entrepreneur, mentor, investor and co-founder of YoungEntrepreneur.com. He is co-author, with his brother Adam, of Kidpreneurs and Small Business, BIG Vision: Lessons on How to Dominate Your Market from Self-Made Entrepreneurs Who Did it Right (Wiley). He's based in Vancouver, B.C.