It’s been a busy few weeks at Radar DDB Toronto. So busy that I haven’t been able to post anything on two high impact changes in the social media marketing landscape on two of the largest scale social media platforms, Facebook and Twitter.
I’ll save Facebook’s changes for a later date as they are going to have a deeper long term effect on the way users and marketers need to approach the platform but Twitter’s long awaited announcement of a business model (Promoted Tweets v1, v2, v3) takes less analysis.
My position on Twitter has long been short (i.e. I love to use it, I see the current value for my clients wanting to participate in social media but I’ve struggled to see a long term future for the technology) so bear that in mind as you run through these top line thoughts and links.
John Battelle – Promoted Tweets looks to take on the same characteristics as Google’s AdWords and look where that platform has headed.
Andrew Goodman – first take is positive, the ads enhance the experience for marketers and users. There will be change, as in all attempts to monetise the experience.
Jeremiah Owyang – Promoted Tweets allows for tight tight targeting and puts pressure on the marketer to achieve ‘resonance’ with the user base with its advertising. There’s also a fancy matrix.
Wall Street Journal – Promoted Tweets will not be a revenue driver for Twitter in the same way AdWords is for Google
Back-of-the-envelope calculations say that Twitter’s 3 million searchers – and their 20-odd million searches every month, even if fully sold at this rate, should generate less than $200,000 a month in revenues. Chump change compared to Google’s near $2 billion a month revenue run rate. Billion dollar valuation? We’ll need another trick for that, thank you very much.
As an aside, WSJ also believes that always on social media threatens the ad-agency model. [I disagree and believe it enhances the need for strategy, creativity and results, something ad agencies are built on, versus, for example, Public Relations]
Silicon Angle – Promoted Tweets are good for ad-agencies but bad for the smaller ad networks as this will redirect advertising dollars to a platform most marketers have a) heard of and b) likely use themselves. Twitter is just another channel where you need expertise and you will likely not get this in house.
Todd Defren – Promoted Tweets are going to be breakthrough in reputation management on Twitter as the official response from a brand can now live on top of the search results rather than being washed away. That is, if the brand can get a call back from Twitter when crisis hits. Does this turn Twitter into a flock of vultures hoping Big Brand A gets into a largescale crisis?
Dachis Group – is the comparison to Google AdWords a good one? People search differently on Twitter than Google. Brands which don’t receive Twitter love should wait for results before looking to invest.
eMarketer – Twitter is smart to “launch a trial balloon rather than a rocket ship”. This will not help Twitter get to 1bn users by 2013 but modest growth based on ad revenue is not an unreasonable expectation.
Mashable – to be successful, advertisers must realize that user acceptance of advertising is likely to take some time, that advertising alone will not do the trick and that they must tailor their advertising to the medium. Good best practices for all forms of marketing.
My thoughts are that this is a good start for Twitter but I’m unsure why it took so long for the company to go public. Pundits have been calling for something like this for months if not years and waiting so long looks like they have been following rather than innovating (a common problem with Twitter). Promoted Tweets are designed to make the advertiser a first class citizen and will have use in both crisis communications and in deal/offer based campaigns. However, to make the most of their advertising buy, brands will have to commit more resources and creativity to the platform.
In pure metrics, how will Promoted Tweets be measured? They are sold, at the moment on a CPM basis and are kept at the top of the results by the number of retweets/interactions. But good old impression numbers are, quite frankly, irrelevant online. I can buy 30m impressions on Facebook for about $5,000. It’s all about the click-throughs and based on my Bit.ly stats, I have a horrendous click through rate. (tr.im gave me credit for a slightly higher rate so clearly there is a play in the analytics space). Of all the links, the WSJ has most cause for alarm. Not for traditional agencies but for Twitter. If the calculations are even 100% too low, Twitter will make about $5m pa from Promoted Tweets. How much will it cost to develop a self-serve portal so advertisers can fill up redundant inventory?
In conclusion, my advice for clients has been to watch and wait. This is just in beta now and none of the big media buying agencies I work with have had much exposure to it. Before you can answer the question “how do I buy Twitter ads?” you must first answer the questions “should I be active on Twitter?” which you can only answer once you know “what is my social media strategy?”
Start at the beginning, take things slow, build up your table stakes and then look to the shiny object.