In retrospect, it’s easy to see why this works — while “Promoted Tweets,” the format the company describes as its “atomic unit” of its ad business, requires a lot of testing and experimentation, buying a trend for the day is a familiar concept for ad buyers.

Anyone who logs on to Twitter for the day will see the promotion, which makes it roughly similar to a homepage takeover on Yahoo or YouTube – it’s a digital billboard.

So who’s buying?

A one-month survey, conducted by CNBC social media strategist Eli Langer, offers some clues. By Langer’s count, Twitter sold 26 promoted trends in the U.S. in the last 32 days — at rate-card prices, that $5.2 million, plus whatever the advertisers paid for in promoted tweets to support the campaign (bear in mind that Twitter sells trends in many other territories worldwide).

Nearly half of those came from Big Media companies pushing movies and TV shows; another chunk came from food-and-beverage marketers.

Thursday (3/7): No Promoted Trend
Friday (3/8): #TheNextBigThing (Samsung)
Saturday (3/9): No Promoted Trend
Sunday (3/10): #TheBible (History Channel)
Monday (3/11): #FeedTheBeat (Taco Bell)
Tuesday (3/12): No Promoted Trend
Wednesday (3/13): #BurtWonderstone (Warner Brothers)
Thursday (3/14) #501s (Levi’s)
Friday (3/15) #TheCallMovie (Sony Pictures)
Saturday (3/16) #3dollarsub (Subway)
Sunday (3/17) No Promoted Trend
Monday (3/18) #BatesMotel (A&E)
Tuesday (3/19) #TheHobbit (The Hobbit Movie)
Wednesday (3/20) #HotNSpicy (McDonald’s)
Thursday (3/21) #BracketBusters (University of Phoenix)
Friday (3/20) #NickyFlash (AT&T)
Saturday (3/23) #RallyCry (Capital One)
Sunday (3/24) No Promoted Trend
Monday (3/25) #Blackberry10 (Blackberry)
Tuesday (3/26) #ItsNotComplicated (AT&T)
Wednesday (3/27) #NYIAS (Toyota)
Thursday (3/28) #TheHost (Twilight Movie)
Friday (3/29) #GiJoeRetaliation (Possibly a few production companies via The Rock’s Twitter account)
Saturday (3/30) #OrphanBlack (BBC America)
Sunday (3/31) #TheWalkingDead (AMC)
Monday (4/1) #AprilFools (Jockey )
Tuesday (4/2) #twEATfor1K (Wendys)
Wednesday (4/3) #BoBSantigoldLive (Vitamin Water)
Thursday (4/4) No Promoted Trend
Friday (4/5) #EvilDead (Sony)
Saturday (4/6) #FinalFour (Capital One)
Sunday (4/7) #MadMen (AMC)

Twitter’s newest price hike went into effect earlier this year, and represents a 33 percent increase over the $150,000 rate the company was asking for in 2012. And it’s up 150 percent from the $80,000 a day it was getting for the ads back when it launched them in 2010.

The promoted trend lets an advertiser insert its own message atop the “trends” list on Twitter.com home pages and on Twitter apps; Twitter sells a single message a day, per territory. Except when it doesn’t: Today, for instance, there’s no promoted trend on the site.

Twitter started selling promoted trends after it launched its “Promoted Tweet” ads, which CEO Dick Costolo describes as the company’s “atomic unit” of its ad strategy.

But while advertisers are still trying to get their heads around paid Twitter messages — they’re not really banner ads, and they’re not really Google-like search ads —  promoted trends have been a hit from the get-go. That’s because it’s the closest thing the company has to a conventional display ad: If you buy one, you’ve got a very good chance that everyone who uses Twitter that day will see it.

So at the very least, the price hike should encourage Twitter and its investors, which are gearing up the company for an eventual IPO.

Twitter only started selling mobile ads in February. But in recent weeks, the company has started seeing more money from the Promoted Tweets it sells on phones than from the same product it sells on desktop computers, says CEO Dick Costolo.

Here’s Costolo, speaking at an Economist conference in San Francisco today:

Even though we launched our ad platform on the web, and only started running ads on mobile a few months ago, it has already been the case a couple weeks ago that we saw mobile ad revenue for the first time in a day be greater than non-mobile revenue. So mobile revenue for us is already doing delightfully well; I couldn’t be happier with it.

That’s a marked contrast from Facebook, which also began selling mobile ads in February, and told investors in advance of its IPO that it didn’t have any meaningful mobile revenue.

Then again, Facebook sold $3 billion worth of ads last year, and Twitter may have done a couple hundred million. So a boom for Costolo is a blip for Mark Zuckerberg.

Still, Costolo seemed to go out of his way today to point out that mobile advertising isn’t a riddle for Twitter to solve, because Twitter has always been a mobile product.

He told the Economist’s crowd that 60 percent of Twitter’s 140 million users get to the service via a mobile device, up from 55 percent six months ago. And he said that those mobile users are more engaged and use the service more frequently than the ones who get on via a PC.

Translation: If Twitter does get to $1 billion in revenue in a couple years, it’s going to do so because of the phone, not despite it.

Twitter has already been showing some limited advertising on its mobile apps. But now it will start showing its “Promoted Tweets” — its primary ad product, and its attempt to replicate Google’s AdWords program — on phones, as well.

Just like the Promoted Tweets that Twitter shows on its primary Twitter.com site, these ads will show up in users’ “timelines.” At first, Twitter will only allow advertisers to place the ads in front of users who are already following their accounts. But within months, it will expand the program to allow marketers to reach people who don’t follow them — just as it does on the Web.

The announcement comes a day before a Facebook marketing event, where that social network is widely expected to roll out a mobile ad product of its own. So the timing may be more than coincidental.

But the bigger picture is that Twitter needed to increase its ad inventory anyway, in order to accomodate a wave of new ad buyers from its self-serve ad program. So this move would have come sooner than later.

Twitter says that any ad buys will automatically include mobile, and that it won’t sell mobile ads separately. One odd exception to the expansion: For now, the ads still won’t show up on iPads.

It’s still just in test mode, and only open to a handful of advertisers. But those who can use it can now buy ads directly via Twitter, using a credit card and a Web browser, without ever having to talk to a human being. Right now buyers can only purchase some of Twitter’s ad products — specifically “promoted accounts” and “promoted tweets” — but Twitter says that will expand over time, as it rolls out self-serve to more buyers.

This is a step that Twitter has been talking about for a long time — so long that it has had to argue with reporters who swear they saw one nearly a year ago — so it’s not earth-shaking stuff. Yesterday, for instance, when Twitter ad sales head Adam Bain disclosed it onstage during an interview at Business Insider’s Ignition conference, it didn’t seem to register.

Still, it’s a significant milestone, because if Twitter is ever going to grow into that $8 billion valuation and beyond, it’s going to have to be able to handle a huge volume of ad transactions — just like Google and Facebook. And that can only happen if small and medium-sized buyers can do it on their own.

At the other end of the spectrum, though, Bain and company are now pre-selling big dollar ad campaigns, to big brands, that will run in 2012. That kind of pre-sale is also the mark of a grown-up ad business, and while Twitter is a long way from getting there, it’s a start.

Here’s Twitter PR rep Matt Graves’s comments on self-serve, via email:

Last month, Twitter began testing self-service advertising with a handful of existing advertisers. These advertisers can now set up and run their own Promoted Products campaigns and pay via a credit card.

This is an important step in continuing to grow Twitter’s business. Our Promoted Products can help small and medium-sized businesses build their audience on Twitter and better engage with the people they want to reach.

As with all of our advertising efforts, we’re starting small, testing carefully and making improvements as we learn what works. We will slowly roll this capability out to more advertisers in the coming weeks and months.

[Shutterstock/Master3D]

What that means to advertisers: They’ll now have an improved chance to get their messages directly in front of some users, by inserting ads directly into their main “timelines.”

What that means to users: Depends. Marketers will only be able to deliver the ads — which will use the “Promoted Tweet” format the company rolled out more than a year ago — to users who already follow them on the service. And they’ll only appear on Twitter’s main Twitter.com site.

So if you don’t follow any brands/marketers/companies on Twitter, you won’t see the ads. And if you’re checking Twitter on your iPhone, or via clients like TweetDeck, you won’t see them there, either.

Here’s how Twitter described it to advertisers:

UPDATE: Here’s Twitter’s blog post about the new ads — or, if you prefer, new ad delivery system.

One important note is that even this program can’t guarantee that an advertiser’s message will reach their followers. That’s because Twitter will only show a certain number of Promoted Tweets using this system, and Twitter will use a bid/exchange system on the back-end, which incorporates both pricing and “relevance” into picking a winner.

As I noted earlier this month, delivering ads into users’s main timelines has been on Twitter’s agenda since April 2010. But this move doesn’t get them all the way there. Eventually, CEO Dick Costolo and company want to deliver ads to users who aren’t following particular companies by using targeting that finds likely recipients.

That is, Twitter wants a way for Starbucks to reach me even if I don’t follow the company, or any other coffee-related companies on the service. You know — just like lots of Web advertising works (or is supposed to work).

The fact that the company has been slow to do that is telling, I think — it shows that they’re quite content to move slowly on ads, despite the braying of outsiders (sometimes including me). Then again, when they’ve got outside investors lining up to spend $800 million on a $8 billion round, that confidence is a little easier to come by.

This isn’t the equivalent of Google’s AdWords, which was Twitter’s original intention when it started its ad platform a year ago. But Twitter may not need that kind of magic bullet to make this thing work — Facebook hasn’t found one, and things are working out okay over there.

Twitter is pushing a new ad product called “Promoted Tweets To Followers,” set to launch by early August.

They will give marketers a chance to place their message directly in front of users who follow particular brands, via ads that will show up when a user first logs on to Twitter.com.

Twitter has been selling “Promoted Tweet” ads, which look and act like regular Tweets, for more than a year. But it’s entirely possible for most users to spend all day on Twitter.com and never see one, since they usually only show up when a user searches for a particular term.

That’s created an inventory problem for CEO Dick Costolo and his sales team, since Twitter users don’t use search in the same way Google users do.

“Promoted Tweets To Followers” are supposed to help solve that problem in two ways. They allow brands to send messages directly to people who have already said they care about them — that is, Starbucks can target people who are already following Starbucks on Twitter. And they can ensure that Starbucks’ followers actually see the ad, by inserting them at the top of their timelines.

Twitter is moving cautiously with the new ads. It’s telling marketers that it will limit the number of Promoted Tweets users see, and tweaking that number as it gauges consumer reaction.

And it’s not pinning the ads at the top of users’ timelines, like it had briefly tried to do with its ill-fated Twitter “quickbar” on its iPhone app this year. The ads will move down the timeline like any other Tweet.

Twitter has already tested Promoted Tweets in timelines via the Hootsuite Twitter client, but this will be the first time it has run the ads on Twitter.com. At the start, the ads won’t run on any other clients, like Tweetdeck or Twitter’s mobile apps.

The company has been pushing the ads to marketers over the past few weeks. Twitter wouldn’t comment on its plans directly, but offered this statement via email: “We are taking a deliberate and thoughtful approach with our advertising platform. As that platform evolves, we will continue to focus on delivering value for both marketers and users.”

Plans for ads in timelines have been in the works since Twitter first unveiled Promoted Tweets back in April 2010. And Twitter has occasionally told advertisers that they’d be coming soon: Last February, for instance, it said ads in timelines would be here by end of Q1.

I think it’s striking that it’s taken Twitter so long to make its ads more visible, even as its valuation keeps skyrocketing. And even this is a modest step — if you don’t follow any advertisers on Twitter, you still won’t see their ads.

Eventually, that will change. Twitter executives say that one day, they’ll have a targeting system that allows marketers to find receptive audiences for their ads even if they don’t search for certain terms or follow their brands. But that’s not happening anytime soon.

But it’s important to note that there are other benefits to owning your own photo-sharing service. For instance, Twitter could use its new service to run ads, just like many other photo-sharing services.

Here’s a nice reminder of how that works: A photo of Sunday’s barely-attended Brewers-Marlins game, posted by Sara Livingston, then retweeted yesterday afternoon by MSNBC’s Darren Rovell. It has since been viewed more than 27,000 times.

Right now those views are generating dollars for Twitpic, which is running two ad units on the page, sold by middlemen like Google, Federated Media and VideoEgg. But there’s no reason Twitter couldn’t be running its own ads against that photo and keeping all of the revenue for itself.

Twitter ads on Twitter photos won’t be a magic revenue bullet for the company. And Twitter hasn’t said anything publicly about its ad plans for the service, anyway–my hunch is that if they do runs ads there, they’ll wait a while to do so. (Note that Facebook is only adding a light dusting of ads next to photos its users share, and Facebook is the Web’s biggest photo-sharing service).

Photo ads would be a nice option for Twitter’s sales team, though. Particularly because they don’t require the company to create an entirely new kind of advertising, like they’re trying to do with their “Promoted” suite of products.

Ad buyers are still trying to get their heads around ads like “Promoted Tweets” because they’re not sure what value they’re getting for their money, what kind of users are seeing them, and whether they can buy enough volume to make the thing worthwhile.

But ads on Web pages, next to photos people like to look at? That’s an easy sell. Doesn’t easy sound nice, Adam Bain?

Which means a Twitter user in, say, the U.K. may now see a different ad than one in the U.S.

If this strikes you as a common-sense must-have feature for any Web ad business–let alone one with Google-sized ambitions–you’re right. Which shows just how embryonic Twitter’s ad product is today, nearly a year after launch.

The positive spin here is that these moves show how much upside Twitter sales boss Adam Bain has in front of him–if the product is this crude now, it has nowhere to go but up. The flip side is that the product is still very crude.

The details: Twitter is now letting some beta testers target Promoted Tweets–the ad units that are actually Twitter messages–by country. Within the U.S., buyers can narrow their targeting down to the city level. And it is also letting testers target Promoted Accounts–its pay-per-follower feature–by country.

Here’s Twitter’s comment:

Since we first launched Promoted Tweets last April, we have said that enabling marketers to geo-target advertising on Twitter was a key next step in our ad platform’s continued evolution… We continuously launch features to enhance the advertising experience on Twitter. As with all of our advertising efforts, we are watching this test closely and will use feedback from advertisers and Twitter users to fine-tune and iterate on the feature.

[Image credit: Chokola]

Which won’t appease the people who hate Twitter’s new iPhone app at all.

So if you’re an app update hater looking for a silver lining, think of it this way: This gives Twitter, and its users, a taste of what’s to come, when the service starts pushing ads in front of most users’ eyeballs.

The people who hate the new app–a small but vocal and visible group of users like Apple blogger John Gruber–are upset about the “Quick Bar” Twitter installed across the top of the app this week, which “shows trends and other important things”. And the Quick Bar isn’t going away.

Twitter says a revised version of the app will push the bar to the very top of the app’s display, instead of actually sitting on top of your Tweets in a translucent box.

But if Twitter really wanted to appease its critics, it would give them the ability to turn the Quick Bar off. And it’s not going to do that, says CEO Dick Costolo.

It’s easy to see why Twitter wants to keep the Quick Bar on the app. It thinks it can turn that sliver of phone screen real estate into ad revenue.

Twitter has already used the bar to display a “Promoted Trend”, one of the two ad formats that are working for the company right now. And while “#tigerblood“, one of the trends that’s appearing on top of the app right now isn’t an ad, clicking on it sends you to a search results page that does display an ad. The top result is a “Promoted Tweet” for a, um, Charlie Sheen poster.

I’ve never heard anyone complain–certainly not to this degree–about Twitter’s other ad implementations so far*, and there’s a reason for that. Promoted Trends and Promoted Users, the company’s two main ad formats, are tucked away unobtrusively on a corner of users’s Twitter.com homepages.

Which means in order to see them you a) have to use the site, which you don’t have to do to use Twitter and b) have to look for them once you’re there.

And Promoted Tweets, the company’s first ad format, are very, very hard to find. Because a) they only show up in search results for certain terms and b) there just aren’t many of them out there. Because Twitter has an inventory problem.

But that’s going to change with Quick Bar. And it will change even more this spring, when Twitter starts running Promoted Tweets in users’ main timelines on Twitter.com.

That’s going to help Twitter solve its inventory problem, since it won’t have wait for users to make certain searches in order to show them ads. But it’s certainly going to freak out a subset of users who’ve grown used to Twitter as an ad-free space.**

Bear in mind that the last update only went live on Thursday, which means the only people grousing about the Quick Bar now are Twitter’s savviest users — the ones who update iPhone apps immediately. My hunch is that vast majority of iPhone app users have yet to see it at all. But the in-stream ads will affect a much larger swath of Twitter’s users.***

On the whole, those users will be much easier to please, or harder to anger****, than the Twitterati grousing over the last couple days.

But there are going to be an awful lot of them. Should be interesting.

—————–

*For the record, Costolo, via Twitter, says the Quick Bar isn’t simply an ad delivery feature but an “alerting mechanism“. Which also delivers ads.

**I don’t have a problem with the ad concept. I like free, ad-supported Web services.

*** I haven’t heard Twitter say they’re going to show the instream ads on its iPhone app, but if they did they’d be that much more intrusive, given the small screen size. I asked Costolo to clarify, but he declined to comment, for now.

**** By the way, don’t click on those “see who’s viewing your profile” links. They’re bogus.

The advertisers are using the service to target consumers who are interested in real-time information about events, such as the Academy Awards show, or those who follow the moves of particular organizations or people.

Twitter’s best-known ad format, called Promoted Tweets, looks like a regular tweet. The ads appear in some users’ individual accounts, tailored to what Twitter knows about their personal interests, and when users type specific keywords into the heavily-used search box on Twitter.com.

Alex Beauchamp, a social business manager for Citrix Online, owner of conference-call service GoToMeeting, used a promoted tweet to take advantage of a sudden opportunity.

Read the rest of this post on the original site

We had intended to post on the news before an embargo breaker fudged up the plan, but since NetworkEffect recorded a video with CEO Bindu Reddy, we figured you might want to see her explain what the company actually does.

MyLikes, which operates primarily on Twitter, connects brands and tweeters for paid product endorsements. It is similar to Ad.ly and to some extent Klout.

The company takes pride in its founders, employees and funders being primarily composed of former Googlers.

Like many social media businesses, MyLikes has landed on the combination of brand advertising with cost-per-click payments. Reddy calls Twitter a television replacement, and her clients include familiar TV advertisers like Coca-Cola, Universal Pictures, Axe Hair and Microsoft.

Reddy works with tweeters including a fake “Family Guy” account and the reality stars Khloe Kardashian and Jon Gosselin. What her publishers have in common is an acute awareness of the direct correlation between attracting an audience and making money. They’re not quitting their day jobs yet, but some might earn enough to hire a part-time tweeting assistant.

Twitter itself does not have a celebrity endorsement product, and according to MediaMemo’s Peter Kafka is playing down its “Promoted Tweets” product where brands can pay to feature their own tweeting.

]]> http://allthingsd.com/20110301/mylikes-ceo-bindu-reddy-on-how-twitter-is-the-new-tv-video/feed/ 0 http://allthingsd.com/20110225/twitters-ad-team-runs-into-the-learning-curve-and-promoted-tweets-take-a-step-back/ http://allthingsd.com/20110225/twitters-ad-team-runs-into-the-learning-curve-and-promoted-tweets-take-a-step-back/#comments Fri, 25 Feb 2011 19:00:07 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=30159 Another sign that Twitter’s advertising plans are very much a work in progress: The company is playing down Promoted Tweets, the first ad units it introduced last year.

Instead, Dick Costolo’s sales force is telling ad buyers that if they want to buy Promoted Tweets–ads designed to run inside users’ Twitterstreams–they should also buy either Promoted Trends or Promoted Accounts–two other ad products Twitter rolled out last year.

This is probably a temporary state of affairs. But it illustrates why Twitter’s ad products are still in the experimental phase.

Promoted Tweets were initially pitched as something akin to Google’s Ad Words, and tied to search keywords. The ads, which are tweets themselves, show up as search results alongside non-sponsored tweets.

The problem is that Twitter search doesn’t work anything like Google search. And many of the “search queries” that Twitter has boasted about in the past are simply auto-refreshing columns in apps like Tweetdeck.

Short version: Twitter doesn’t have enough search inventory for specific terms to accommodate Promoted Tweets. “It’s a powerful ad, but it doesn’t scale,” says one ad buyer.

Buying a “Promoted Trend” helps solve the problem, temporarily, since users who click on the trend end up creating a search query where the Promoted Tweet can show up. (Click on today’s “Hall Pass” Promoted Trend and you’ll see a Promoted Tweet pushing the new movie.)

I’m not clear how bundling Promoted Tweets and Accounts helps marketers, though Twitter’s instructional video for ad buyers promises that buying them in tandem will “turbocharge” results.

The bundle does help Twitter, because the inventory for Promoted Accounts is much deeper. Buyers pay for every follower they sign on to their account, and the only real limit there is the size of Twitter’s user base.

Twitter declined to comment.

As I noted last week, Twitter hopes to have a long-term solution to its inventory problem this spring, when it starts running Promoted Tweets in users’ main “timelines” on Twitter.com. That should give the company a huge swath of real estate to sell.

And the flip side of this story is that Promoted Trends and Accounts, two products Twitter rolled out last year with much less fanfare, seem to be selling quite nicely for the company. Which is the nature of start-ups: Sometimes the thing you’re counting on doesn’t come through. And sometimes the thing you weren’t counting on turns into a pleasant surprise.

]]> http://allthingsd.com/20110225/twitters-ad-team-runs-into-the-learning-curve-and-promoted-tweets-take-a-step-back/feed/ 4 http://allthingsd.com/20110218/twitter-asks-ad-tester-not-to-talk-about-testing-twitter-ads/ http://allthingsd.com/20110218/twitter-asks-ad-tester-not-to-talk-about-testing-twitter-ads/#comments Fri, 18 Feb 2011 11:00:32 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=29954 We now have a pretty good idea of how Twitter’s ad products work. How do they perform?

You’d have to ask companies that have tried them out. One Twitter ad tester, VoIP platform CallFire, would like to tell the public. But Twitter has asked them not to share.*

Here’s the beginning of a blog post CallFire marketer Natalia Klishina published Wednesday:

Towards the end of 2010, CallFire was invited to try out the beta of Promoted Twitter. I had originally written a blog article explaining the service and reviewing it. Unfortunately, this article has been removed due to Twitter’s informing us that “during the beta rollout of [their] Promoted Products services, advertisers can’t blog about their experiences using the products.”

And then Klishina inserts this clever retort:

No comment from Twitter.

*To be fair, asking beta testers not to talk publicly about beta tests isn’t unique to Twitter. Google, for instance, does the same thing.

]]> http://allthingsd.com/20110218/twitter-asks-ad-tester-not-to-talk-about-testing-twitter-ads/feed/ 2 http://allthingsd.com/20110216/inside-twitters-sales-machine-a-secret-guide-for-advertisers-video/ http://allthingsd.com/20110216/inside-twitters-sales-machine-a-secret-guide-for-advertisers-video/#comments Wed, 16 Feb 2011 16:45:01 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=29862 Twitter hopes to generate something like $100 million from advertising this year, but first it has to teach people how to buy its ads. Here’s how it’s doing that: A hand-holding how-to video, which walks through everything from pricing to dealing with angry users.

The tutorial, which runs 40 minutes, is up on YouTube, but it’s unlisted and is only accessible via a private link. Thanks to a helpful reader, I’ve been able to watch it myself, and I’ve uploaded it at the bottom of this post so you can see it, too.

But it is 40 minutes long–and most of you don’t need to watch all of it. Here’s what you need to know if you’re interested in advertising, technology and Twitter’s first attempts at making real money:

Promoted Tweets, Twitter’s first big ad product, hasn’t taken off.
Instead, at least for now, Twitter is pushing customers to spend most of their money on Promoted Accounts, its pay-per-follower product it rolled out at the end of last year. Twitter tells advertisers they ought to spend $4 on Promoted Accounts for every $1 they spend on Promoted Tweets–the original Google-style ad concept CEO Dick Costolo introduced last year. Twitter says that’s because it’s a lot easier to buy the former than the latter, because there’s a lot more inventory available. (And because Promoted Accounts will “turbocharge” Promoted Tweets.)

Promoted Tweets should get a big push in the next month or so.
Until now, the only way you’re going to see a Promoted Tweet is if you click on a search term that someone has purchased, or if you’re using Twitter app HootSuite. But Twitter says the ads will start running in users’ regular “timelines”–the primary Twitterstream they see–on its own Twitter.com site, by the end of Q1. That’s going to make them much more visible, and should hopefully help with the inventory problem noted above.

Twitter is telling customers to expect an “engagement rate” of 1 percent to 3 percent.
Ad buyers are usually trying to measure success by figuring out how many people looked at or clicked on an ad. Click-through rates for most Web ads are very tiny, and according to an ad buyer who has seen Twitter’s presentation, the company says a realistic click-through rate is 0.3 percent. But “engagement” rates–which measure when a user retweets an ad, or likes it, etc.–are supposed to be much higher. My tipster, by the way, says Twitter is requiring new ad buyers to make a purchase of at least $5,000 worth of inventory in order to participate in the company’s beta tests.

Twitter is warning buyers that some users will have a problem with their ads.
At the end of the presentation (around the 35-minute mark), the company takes time out to coach buyers about “dealing with negative user feedback,” which it more or less assumes they’ll be getting. “People are averse to change, especially when it comes to advertising, and this type of feedback is to be expected,” Twitter’s off-screen instructor explains. The company’s suggested coping strategy: Don’t worry! The complainers are an “extremely marginal percentage of the total.”

[UPDATE: So how do the ads actually work? A Twitter ads tester would like to share their experiences with the rest of the world, but can't.]

]]> http://allthingsd.com/20110216/inside-twitters-sales-machine-a-secret-guide-for-advertisers-video/feed/ 9 http://allthingsd.com/20110211/twitter-tells-advertisers-to-dig-deeper-promoted-trends-are-going-to-get-more-expensive/ http://allthingsd.com/20110211/twitter-tells-advertisers-to-dig-deeper-promoted-trends-are-going-to-get-more-expensive/#comments Fri, 11 Feb 2011 11:30:11 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=29572 Twitter’s “promoted trends” ads may be the company’s most consistent source of revenue. Now the company wants to wring more money out of them: It has told buyers to expect a significant price bump for the ads in the next few months.

Twitter doesn’t have a formal rate card, but ad industry sources say the going price for a one-day promoted trends purchase has settled between $70,000 and $80,000, after starting out as high as $100,000 a day.

Now Twitter has started telling buyers the coming price hike will consistently push the ads into the $100,000 to $120,000 range.

Promoted trends give an advertiser a chance to essentially purchase a small sliver of Twitter’s site, by inserting their message at the top of the “trends” section of users’ pages. For now, Twitter sells only one per day, and has been selling the slot out with some frequency.

And promoted trends could become even more valuable for Twitter CEO Dick Costolo and his company if they start carving the ads up into different geographies, giving them the ability to sell more than one per day.

If, say, Twitter could sell at least two different promoted trends, in two different territories each week, at $100,000 a pop, those ads alone could generate $20.8 million a year. Play around with those assumptions, and you can quite easily bite off a big chunk of the $100 million-plus ad revenue estimates we’ve seen floated.

Ad buyers also tell me Twitter has been bullish about its “Promoted Accounts” product, which it rolled out toward the end of last year.

When I first wrote about the concept last summer, and described it as a way to let marketers (or anyone) “buy” followers, the concept upset some Twitter traditionalists.

But they’re going to have to get over it, because it’s exactly what Twitter is selling: It prices the ads, which show up on users “Who to follow” list, on a “cost per follow” basis. Buyers pay between $1 to $3 for every new account that follows them.

The one Twitter ad product I haven’t heard buyers talk that much about is the first one Twitter rolled out. “Promoted Tweets” were supposed to work like Google’s AdWords–”organic” tweets, tied to keywords, that showed up in search results, and later in users’ regular streams.

That seemed like a promising tactic at first. But I’ve never seen a promoted tweet “in the wild”; the only time I’ve seen them is when they’re attached to the promoted trends.

But perhaps I’m just missing them. If you’ve bought one, or if you see one, please pass drop me a line (peter@allthingsd.com) and let me know.

]]> http://allthingsd.com/20110211/twitter-tells-advertisers-to-dig-deeper-promoted-trends-are-going-to-get-more-expensive/feed/ 7 http://allthingsd.com/20110126/twitter-testing-self-serve-ads-for-launch-this-year/ http://allthingsd.com/20110126/twitter-testing-self-serve-ads-for-launch-this-year/#comments Wed, 26 Jan 2011 10:19:00 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=28631 UPDATE: Twitter says MediaPost got this wrong, and that it has yet to test a self-serve platform. I’ve asked MediaPost for comment.

Earlier:

——————————-

Twitter wants to replicate Google’s and Facebook’s advertising success, and in order to do that it will have to have a self-service ad platform, just like the big guys. It’s now testing out the service, which it wants to launch later this year, and MediaPost has a lengthy preview. Takeaways: The platform is designed to sell Promoted Tweets and Promoted Accounts; buyers can use both search keywords and users’ interests to target the ads.

]]> http://allthingsd.com/20110126/twitter-testing-self-serve-ads-for-launch-this-year/feed/ 0 http://allthingsd.com/20110124/a-first-guess-at-twitter-ad-results-how-does-150-million-sound-for-2011/ http://allthingsd.com/20110124/a-first-guess-at-twitter-ad-results-how-does-150-million-sound-for-2011/#comments Mon, 24 Jan 2011 12:20:06 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=28498 Twitter’s ad business is still in the just-getting-started phase, but eMarketer thinks that will still be a nine-figure business: It predicts Adam Bain and crew will sell $150 million worth of promoted tweets, promoted trends, etc., this year. Next year, spurred in part by a Google/Facebook-like self-serve ad system: $250 million. “But the company must show it can live up to its hype.” Noted!

]]> http://allthingsd.com/20110124/a-first-guess-at-twitter-ad-results-how-does-150-million-sound-for-2011/feed/ 2 http://allthingsd.com/20101103/promoted-tweets-graduate-to-google/ http://allthingsd.com/20101103/promoted-tweets-graduate-to-google/#comments Wed, 03 Nov 2010 21:27:26 +0000 Voices http://voices.allthingsd.com/?p=32009 Quite the week for the paid ads that Twitter calls Promoted Tweets. First they start showing up uninvited in some users’ timelines in a test ahead of a broader rollout. And over the next couple of days, they’ll start to appear along with certain query results in Google’s Realtime Search. This is the first time that ads from an outside network will appear on Google, reports Danny Sullivan of Search Engine Land, and the revenue will be split 50-50.

]]> http://allthingsd.com/20101103/promoted-tweets-graduate-to-google/feed/ 0 http://allthingsd.com/20101101/twitter-tests-the-waters-with-in-stream-ads/ http://allthingsd.com/20101101/twitter-tests-the-waters-with-in-stream-ads/#comments Mon, 01 Nov 2010 20:06:39 +0000 Voices http://voices.allthingsd.com/?p=31859 As promised, Twitter is now starting to throw paid ads into users’ streams and hoping not to cause too many ripples in the process. In an initial test with the 900,000 users of third-party client HootSuite, the ads–Promoted Tweets–will be inserted into users’ personal timelines when relevant, based on context and connections. Given the potential for rebellion, Twitter is assuring users its approach to the rollout will be “deliberate and thoughtful.”

]]> http://allthingsd.com/20101101/twitter-tests-the-waters-with-in-stream-ads/feed/ 0 http://allthingsd.com/20101004/conan-obrien-really-really-wants-some-twitter-followers/ http://allthingsd.com/20101004/conan-obrien-really-really-wants-some-twitter-followers/#comments Mon, 04 Oct 2010 18:43:08 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=24116 I follow Conan O’Brien on Twitter. So do 1,677,799 other people.

But that’s not enough for O’Brien. Or, more likely, it’s not enough for Time Warner’s (TWX) TBS channel, which is paying big money to bring O’Brien back to TV next month. In any case, someone is paying Twitter* to make @TeamCoco a “Promoted Account”–one of the first that Twitter has rolled out today.

Here’s what that looks like (via my “New Twitter” homepage):

A little redundant, and I’m probably not going to follow two different Conan accounts. But whatever. It doesn’t have any material impact on the way I use Twitter, which remains both free and useful to me. (Except when it breaks, as it seems to have done just now.)

My hunch is that I’m going to feel the same way as Twitter starts to carve out increasing amounts of real estate for ads and other revenue-generating products on its platform. That’s what media companies do, after all.

And in fact, here’s another small ad move coming out of Twitter at the same time. It has moved up its “Promoted Trends” product from the bottom of its topics list to the top, where I’m more likely to see it.

Or at least it says it has: My Twitter Trends feature, which is set to “New York,” doesn’t show me any Promoted Trends at all. If and when they do show up, the fact that they’re up higher won’t make much difference to me, because I almost always ignore Trends in general.

And that’s the real risk for Twitter here–not that users will be turned off by ads, but that they’ll ignore them, just as they do throughout most of the Web. When’s the last time you clicked on, or even looked at, a Gmail ad from Google (GOOG)?

*It is possible that no one is actually paying Twitter to promote TeamCoco, and that the company is throwing it in as a promotional freebie, as it did in some cases when it rolled out “Promoted Tweets.”

]]> http://allthingsd.com/20101004/conan-obrien-really-really-wants-some-twitter-followers/feed/ 2 http://allthingsd.com/20100928/twitter-puts-earlybird-down-for-a-long-nap/ http://allthingsd.com/20100928/twitter-puts-earlybird-down-for-a-long-nap/#comments Tue, 28 Sep 2010 16:25:58 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=24012 As Twitter continues to roll out new revenue products, it is also putting some away. Twitter is “setting aside” its “@earlybird” shopping promotional product, COO Dick Costolo said today at an Advertising Week event. Costolo left open the possibility that Twitter could revamp the product and bring it back, but I wouldn’t count on it–too much work to do on its primary products: Promoted Tweets and Promoted Trends, which will be joined shortly by Promoted Accounts. Meanwhile, Costolo gave at least one hint of nonrevenue products the company is working on: It’s trying to figure out a better way to let people know about real-time Twitter coverage of events, he said.

]]> http://allthingsd.com/20100928/twitter-puts-earlybird-down-for-a-long-nap/feed/ 0 http://allthingsd.com/20100927/exclusive-want-twitter-to-help-you-find-more-followers-pay-up-for-a-promoted-account/ http://allthingsd.com/20100927/exclusive-want-twitter-to-help-you-find-more-followers-pay-up-for-a-promoted-account/#comments Mon, 27 Sep 2010 18:48:49 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=23925

Twitter is still working to get its first two ad products up and running. But it’s going to launch a third, anyway: Tomorrow the company will show off “Promoted Accounts” at an ad industry conference in New York.

The idea is a simple one, people familiar with the company’s plans tell me: Twitter will try to help corporations and brands increase their Twitter following by inserting them alongside other Twitter users it suggests in its “Who to Follow” feature.

It’s easy enough to see how that would appeal to an advertiser, assuming they saw value in a robust Twitter following to begin with. (And if individual users want to boost their follower count for others reasons, Twitter will sell them the service, too.)

And Twitter will try to make the promotions palatable to users by serving up only “relevant” accounts, using the same algorithm that it already uses when it suggests “Who to Follow.”

In theory, that means that if you’re not interested in LeBron James, and none of the people you follow on Twitter follow LeBron James or related Twitter accounts, then Twitter won’t suggest that you follow LeBron James. Even if he hands them a pile of money.

In practice, it’s easy enough to see how the definition of “relevant” could get stretched here–if you pay attention to sports in general, could you end up with a LeBron suggestion? But it’s hard to see how the opt-in product–Twitter can’t make you follow LeBron–would upset users who are already looking at the “Promoted Trends” the social network is also serving.

I don’t have details on pricing, but it’s possible that COO Dick Costolo will talk about that when he rolls out the new product tomorrow, at the IAB MIXX conference in New York City.

But as I noted when I first wrote about the product back in July–I referred to it as “Promoted Tweeters” at the time–there are some fairly obvious ways to go there: Twitter could charge users based on the number of followers they acquired, or simply based on the exposure their Twitter accounts received.

And it’s easy to see how the new product fits in alongside the first two Twitter has already rolled out. Its “Promoted Tweets” are supposed to parallel Google’s AdWords product, but have been slow to take off. But its “Promoted Trends,” closer to a conventional display ad, have found a warmer reception with advertisers.

Twitter declined to comment, but referred me to the comment they offered when I first wrote about this a few months ago:

“We will eventually have full suites of both promoted and commercial products. All the components of these two buckets of product have yet to be determined. Some are currently being tested publicly now. Some will be tested soon. Some are just ideas that we are broaching externally for feedback.”

]]> http://allthingsd.com/20100927/exclusive-want-twitter-to-help-you-find-more-followers-pay-up-for-a-promoted-account/feed/ 8 http://allthingsd.com/20100914/the-new-twitter-com-is-a-consumption-environment-translation-twitter-is-a-reluctant-media-company/ http://allthingsd.com/20100914/the-new-twitter-com-is-a-consumption-environment-translation-twitter-is-a-reluctant-media-company/#comments Tue, 14 Sep 2010 23:56:28 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=23470 Twitter’s new Web site has lots of cool features and gizmos. But they’re all supposed to do one thing in particular: They’re meant to encourage you to spend more time on Twitter.com, where the company can show you some ads.

The Twitter folks don’t exactly present it that way, of course. I talked to CEO Evan Williams and COO Dick Costolo earlier today, and they both repeated the mantra that the new Twitter is supposed to reflect the fact that Twitter is a “consumption environment,” where it’s just fine to read (or watch videos or look at pictures) instead of write.

In Williams’s words: “We’re trying to get people to understand that they don’t have to tweet if they want to get value out of Twitter.”

Which is another way of saying that Twitter is a media company: It gives you cool stuff to look at, you pay attention to what it shows you, and it rents out some of your attention to advertisers.

And that’s the real parallel with Facebook here. Not that both have inline video in the timeline or other design similarities, but that both companies started out trying to avoid the advertising business, and that both of them have ended up embracing them.

Nothing wrong with that, of course!

Speaking of which, how are Twitter’s new ad products coming along? Just great, says Costolo, who told me about engagement rates that pushed into the “double digits” for some of the company’s “Promoted Tweets” – and single digits for most of them. Which is way, way higher than traditional Web ads.

And Costolo says Twitter’s “Promoted Trends” product has been able to “boost the conversation” around given Twitter topics by as much as 600 percent.

The informal feedback I’ve heard is that advertisers are quite comfortable with Promoted Trends, since they function much like conventional display ads. But less so with the Promoted Tweets, which are sort of like Google’s AdWords but not really–unlike Google (GOOG), Twitter has very little idea of what’s on your mind.

But we’ll see: Costolo says Twitter will start pushing out the paid tweet ads more aggressively in the next few months.

Here’s a brief chat I had with Costolo before Twitter’s press event this afternoon, where we talk about the new site’s new features, the company’s ad plans and the inevitable “what will TweetDeck think of this” questions. Apologies once again for the horrendous video, but at least this time I have an excuse. I managed to lose my Flipcam en route to Twitter’s headquarters, so this one was shot with the BlackBerry Tour’s limited camera:

]]> http://allthingsd.com/20100914/the-new-twitter-com-is-a-consumption-environment-translation-twitter-is-a-reluctant-media-company/feed/ 15 http://allthingsd.com/20100727/twitter-links-up-with-jetblue-again/ http://allthingsd.com/20100727/twitter-links-up-with-jetblue-again/#comments Tue, 27 Jul 2010 17:08:51 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=21877 Another small step in Twitter’s slow-motion business plan: A tie-up between the messaging service and JetBlue for Twitter’s @earlybird account, which gives followers 20 percent off of (some) tickets. This is the second time JetBlue has worked with Twitter: It was also one of the lead marketers in its initial rollout of “Promoted Tweets”. Which we haven’t heard that much about for some time, by the way…

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