Twitter Finds Its Business Model

Twitter announced today that it will be rolling out paid advertising, known as Promoted Tweets. This move is meant to bring in revenue and put a stop to questions about “What is Twitter’s business model going to be?”. COO Dick Costolo will discuss this offering in detail at today’s AdAge Digital conference and tomorrow at the official Twitter developer conference, so we can expect to hear much more about Promoted Tweets in the coming days.

Promoted Tweets are not traditional advertisements. These are organic tweets that brands want to promote to a wider audience. They act just like normal tweets which appear in your timeline, but they will be clearly marked as “promoted” and will gain special placement at the top of some search results pages. Think of it like paid search advertising, but your status update takes the place of ad copy. Only one Promoted Tweet will appear on a search results page at a time and, if the tweet does not “resonate” with users (measured in the form of replies, retweets, and favoriting), Twitter may stop displaying it. Promoted Tweets must also be timely, delivering information that’s relevant to what's currently happening.

This new advertising system will be unveiled in phases. This will allow time for Twitter users to get used to seeing Promoted Tweets and for Twitter to develop a system that pleases both advertisers and users. Initially the Promoted Tweets service will only be available to partners, including Best Buy, Bravo, Red Bull, Sony Pictures, Starbucks and Virgin America. Over time the service will be available to other advertisers and Promoted Tweets will begin to appear outside of the Twitter search results.

What does this mean for brands? Twitter is putting a premium on the quality of its user experience. If you were hoping for an easy way to promote yourself on Twitter without having to invest in the community, you’re out of luck. You can’t just “buy Twitter ads” and be done with it. Once Promoted Tweets are available to all advertisers, you will need to maintain an active Twitter account and post engaging tweets that can then be featured through this system. Promoted Tweets can also be used for proactive reputation management -- if your brand needs to get out in front of a conversation (for instance, respond to inaccurate or negative media coverage), this will be a great way to make sure your messages are front-and-center for other Twitter users to see.