Twitter – the word, rather the website needs no introduction, but just to make a start, let’s do a formality. Twitter - a highly popular social networking and microblogging service which runs through a website that allows people to post 14-character messages, operated by Twitter Inc. Ever since its creation in 2006, millions of dollars have been spent funding it, but speculations have always been on as to what makes it generate revenue if not ads or other visible means of revenue generation.
TechCrunch’s explosive “Twitter records out” publishing in mid-2009 had figures of Twitter’s projected earnings for 2009 and its internal strategy, dealing with Google and Facebook, information giving indications of its monetization. Somewhere around that time, Biz Stone, a Twitter co-founder, also spoke about developing add-ons and services for businesses and professional users of Twitter with a possibility to create a revenue stream for the company, expecting to have some of them start contributing for the fourth quarter of the year 2009. However, outfocusing from the cost of paid services or revenue building from it, put forward were the “red herrings” of further expansion of the company and its user base. Ok, let’s fly over from here and land on the “income” ground!
As a part of monetization effort, Twitter made deals with Google and Microsoft. It was for Google and Bing search results to show the “tweet streams.” It’s believed Twitter made huge money from those deals.
Further, as declared in December 2009, what we get from the Twitter Blog, a feature they were beta testing was ‘Contributors’- a business-specific feature (that was a cash flow channel to Twitter!). The blog further stated this feature “to be enabling users to engage into more authentic conversations with businesses by allowing those organizations to manage multiple contributors to their account.” Allowing a contributor’s username to display in the tweet byline, it facilitated a more personalized form of communication between the business and the consumer. With corporations ready to pay money for such premium services designed by Twitter specially for them allowing them to stay in touch with their customers and raise their sales, Twitter found a way to sell its services too.
It’s in April of 2010 that we find Biz Stone coming up with a revenue generation idea introducing “Promoted Tweets.” What we get from his blog is:
“We are launching the first phase of our Promoted Tweets platform with a handful of innovative advertising partners that include Best Buy, Bravo, Red Bull, Sony Pictures, Starbucks, and Virgin America — with more to come. Promoted Tweets are ordinary Tweets that businesses and organizations want to highlight to a wider group of users.”
That’s pretty much like Twitter’s first steps into advertising, however planned in such a way that it is non-intrusive or non-frustrating to its users. Coming up as an extension to the Promoted Tweets platform was a new advertising concept named “Promoted Trends” to be put to test in June of this year allowing users to see time-, context-, and event-sensitive trends promoted by Twitter’s advertising partners. The newly released Disney/Pixar Hollywood movie Toy Story 3 seems to be the very first promotion using this new “Promoted Trends” model. So, monetization for Twitter comes up with this unusually different advertising and promotional model.
At the end point of the matter, it’s not much mystery left there how Twitter earns or plans to earn. However, commendable is the way they have devised their revenue generation models – effective and without letting the user experience go down. And, if we patiently wait, as Twitter itself has remained much patient with its monetary growth, we can expect some more excellent services and ways on the Twitter path where money would come along with keeping the user base intact, loyal, and growing.