Earlier today, Twitter formally announced that you may start to see Promoted Tweets in your main Twitter timeline. In other words, ads will enter the stream in a truly significant way for the first time. As this news began to trickle out over the past few weeks, there was some concern that this may cause user backlash. But Twitter’s head of global revenue, Adam Bain, doesn’t see it this way at all. In fact, he believes it will be a win-win for both brands and users. Shortly after the announcement, we had the chance to talk with Bain.
“It’s no secret that as Twitter has grown, companies have flocked to it,” Bain says, noting that marketers and brands have been there since practically day one. “We’ve found that 20 to 40 percent of users follow one or more brands on Twitter,” he continues, noting that this is extremely important (the stat is based on third-party research and is so wide because the definition of “brand” varies). “Users want to be updated when brands have updates or exclusive content. The one problem we’ve heard from users is that when there is exclusive content or deals, there’s a chance they might miss them,” he says. “If the brand tweets at 9 AM, and the person comes in at 9:15 AM, they’ll miss them.”
Hence, Promoted Tweets in timelines.
Bain notes that this new concept works the same way as Promoted Tweets have been working in Twitter Search for some time now. “We know this works for users and this also works for brands,” he says. He then rattles off some of the big brands they have signed up as launch partners: Dell, HBO, Summit Entertainment, Red Bull, Sephora… The list goes on.
“As always, the Promoted Tweets will be relevant to consumers. You already follow the brand,” Bain says.
Okay, that all makes sense and sounds good. But clearly this is the biggest step forward yet in terms of monetizing Twitter.
Along those lines, I ask Bain about the pricing of this product. He says that while he can’t talk about specific pricing, this is the same model that the other Promoted products on Twitter follow. That is, it’s a “bidded” marketplace. For about a year, Twitter has been perfecting this model in search and a few other places, and have realized that the cost-per-engagement model works well on the service. If a brand does a Promoted Tweet, Twitter can only charge if there’s an engagement on the ad. That means Twitter only makes money if someone clicks, retweets, or favorites the Promoted Tweet. And most of those engagements are actually clicks, Bain says.
“It turns out that on Twitter, users are already interacting with ads on a level that most would be surprised by,” Bain says. He notes that while traditional online display ads only get a click-through rate of something like 0.05 percent, some Promoted Tweets are seeing engagement in the double-digit percentages. “Engagement matters,” Bain says.
And it really matters to Twitter. Because if the ads aren’t being engaged, Twitter has the right to remove them. There’s also a more explicit way for a user to say they don’t want to see the ad: simply “X” it out and it will disappear from the timeline. “We use a lot of signals to measure and understand relevance,” Bain says.
“Resonance is also really important to us. This is about the realtime opportunity. And that expires fairly quickly,” Bain goes on, saying that in the ideal scenario, the things brands tweet will be “good, not loud”.
Bain says that the realtime aspect of the product is also vital to how Twitter places them. Because hot topics that people are Tweeting about can happen at any time, Twitter needs to be able to talk to a brand and quickly place an appropriate Tweet. “It’s realtime marketing at scale,” he says. “That’s the whole value proposition of the platform.”
When I ask about the importance of exclusivity for the deals Twitter is offering (that is, will only Twitter get to offer them?), Bain says that it’s important to note that Promoted Tweets aren’t just about deals or offers — he doesn’t want this product thought of as “Twitter Deals”. “That’s one of a bunch of categories that consumers find interesting,” he says. “More than half of our launch is about exclusive content,” he says.
Bain talks about one recently successful Promoted Tweet campaign involved the film Super 8. Apparently, Twitter sold over $1.5 million worth of tickets in just a couple of hours. And remember, that was just due to Promoted Tweets in search and Promoted Trends. In the stream, such numbers could and should go even higher.
Bain also says that Twitter has been giving marketers advice on what type of content will work in the stream. He says that it’s really about getting the right Tweet out there to establish a connection. “If people are following your brand, they’re some of your most loyal and passionate customers,” he notes. Now it’s just time to connect the dots.
Again, this is clearly Twitter biggest move into the money-making waters yet. Will it work? We’ll see, but it’s clearly the next logical step for the Promoted Products. After months of perfecting them in search and on the sidebar, now they’ll be put to the real test. We should see quickly if users begin to unfollow brands as a result, or if the engagement rates go through the roof. If it’s the former, it’s back to the drawing board (again) for Twitter. If it’s the latter, it could be time to think of Twitter as a serious business.