Peter Kafka

Recent Posts by Peter Kafka

Twitter’s Ad Plan: Copy Google

What will Twitter’s long-awaited ad platform look like? Something like Google’s.

That’s the general description of Twitter’s plan, according to people who have been briefed by the company.

Here are the very broad strokes:

  • Ads will be tied to Twitter searches, in the same way that Google’s (GOOG) original ads were. So a search for, say, “laptop,” may generate an ad for Dell (DELL). The ads will only show up in search results, which means users who don’t search for something won’t see them in their regular Twitterstreams.
  • The ads will use the Twitter format–140 or fewer characters–and will be distributed via the third-party software and services that use Twitter’s API. The services will have the option of displaying the ads, and Twitter will share revenue with those that do.
  • Twitter will work with ad agencies and buyers to seed the program, but plans on moving to a self-serve model like Google’s, down the road.

The caveats: Everyone I’ve talked to cautions that the plans are evolving and that there are plenty of details to work out. Including a launch date, though it seems as if the first half of this year is a very safe bet.

But at first blush, this seems like a relatively straightforward way for Twitter to get into advertising, without upsetting its growing user base: You won’t see the ads unless you use Twitter to search for something, and Twitter’s advertisers will have at least a vague idea of what you’re interested in.

There are lots of gritty details that Twitter either hasn’t worked out or hasn’t disclosed to the people I’ve talked to. For instance:

  • How will advertisers buy and price the ads? Will they use a Google-like cost-per-click model or something else?
  • Twitter searches are popular, but very crude. Can Twitter refine them to make them more useful to users?
  • Google’s ads work because Google has reasonably good idea of both users’ intent and identity. Twitter knows much less about its users. How can it gather enough data to make its targeting more meaningful?

Twitter has been careful not to position its ad plan as the core of its business. And the company has made a point of stressing that its initial ad rollout, like other initiatives it’s launching this year, are merely “tests.”

That’s one of the of ideas behind the $100 million funding round Twitter closed last summer–it gives the company the time to play around with different business models. But this one seems to have plenty of potential.

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