Twitter Launches “Promoted Tweets”

By on in Technology

The rumor mill was buzzing last month at leading industry conferences such as South by Southwest (SXSW) and Search Engine Strategies (SES) over Twitter’s anticipated launch of an ad platform.

Twitter Ads

Well…it’s official -Twitter has launched and is starting to roll out (slowly) “Promoted Tweets,” which will initially only pop up on searches at Twitter’s Web site. The initial roll out will be limited to a small group of test marketers including Virgin America, Best Buy Co., Sony Pictures and Starbucks Corp. As of yesterday Twitter reported that fewer than 10 percent of its users were expected to see the ads, but the ads should start appearing on all relevant searches within the next few days.

With over $155 million in investments from leading Venture Capital firms and a projected $1 billion valuation on barely any income….now is as good a time as ever to launch an ad platform and capitalize on Twitter’s 75+ million users who post over 50 million tweets daily.

Seems to me if you can launch an ad platform that doesn’t disrupt the normal communication flow on Twitter it can turn into a jackpot.

For instance, Facebook launched Facebook Ads (it’s proprietary ad platform) a little over a year ago and since then it has become a revenue creation monster for Facebook. In fact, based on several conversations that I’ve had with friends at Facebook….Facebook is expected to generate over $1 billion in revenue in 2010….and a nice slice of that revenue (estimated at north of 40%) is coming from Facebook Ads.

Based on Facebook Ads….Twitter’s ad platform should be a hit.

From what is known at this point it looks like Twitter’s ad platform is strictly meant for advertisers, meaning Twitter makes money by selling inventory to advertisers. Twitter’s “inventory” at this point appears to be search keywords. For instance, it makes sense that Virgin America would want to show a promotional tweet when Tweets occur about airline travel. Promoted Tweets appears to make this possible.

It will be interesting to see what other type of inventory Twitter will introduce in the future. It certainly would be cool if the ad platform was self serve like Facebook Ads and Google AdWords and advertisers (not just the largest of advertisers like Twitter’s pilot would suggest) could compete to show promo ads for specific search streams.

It’s difficult to discuss Twitter’s “Promoted Tweets” without at least giving a shout out to my friends over at “Sponsored Tweets.”

Sponsored Tweets (a VC backed firm owned by the founders of Pay Per Post) is an ad platform that enables advertisers to partner with select Twitter users on a pay per tweet basis.

For instance, say you are an advertiser that would like a web or Hollywood celebrity to Tweet about your product or service – Sponsored Tweets allows you to do just that. As an advertiser you pay for Twitter users to Tweet your stuff. As a Twitter user you get paid to Tweet advertisers stuff. It’s a win win, but of course Twitter doesn’t make any money here so they needed their own ad platform that they control.

What are your thoughts on Twitter’s “Promoted Tweets?”

If you have some thoughts share them and I’ll be sure to agree or rebut. :)

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