With the recent surge of Twitter growth, it seems like everybody is trying to add their own 2 cents on how Twitter can create their monetary business plan. The social network has grown over 1000% during the last year, yet the company has yet to really make money of any of their community success.
When you have so many users, creating a sound plan to make money off them wouldn’t seem so hard, except when it comes to Twitter. How can you create a sound monetary business plan for a service that is often used through third party applications?
If you haven’t used Twitter yet, basically a profile page consists of the users image, name, location, web site, and brief description. If you are artistically savvy, you can also create your own background. The original Twitter feed page itself is just a simple list of the latest twits. If Twitter wanted to they could easily add some ads here and there, but the beauty of Twitter is that you can use it anywhere anytime.
If you have a Twitter account, take a second to look down the list of latest Tweets. You will notice that almost 90% of the tweets come from some third party application. The reason Twitter has grown so quickly is because it is basically a simple and easy tool to use directly from your phone or other mediums.
Now if many of your users are using the service, but through third party apps, haven’t you basically lost them?
If you look at Facebook, you will notice the ads are located usually to the right of the profile and mixed in with feeds, and they are targeted to the same keywords that are in the profile. If Twitter was to try this same approach and throw up some ads on your Twitter page, what good would it do if most users are not even using the page?
Another idea I have heard about was to charge for premium accounts, but what could they offer that would drive people to want to move from free to pay? If anything they would have to take something away, such as a limit on how many people can follow you.
The easiest option would seem to just insert ads blended in as tweets. You could have these ads targeted by what a specific user has been tweeting about and they could show up every so many tweets, but now you come to the problem of revenue sharing. If other companies are making these third party apps to use on Twitter, then shouldn’t Twitter have to share some of the revenue with them?
Whatever the solution Twitter comes up with will definitely be an interesting and one many are anticipating. While you can’t really trust the figures that are being thrown around, many top analysts are valuing the social network at $1 billion dollar plus. Seems like a reach for a company yet to actually derive money from the service.