How can Twitter make money? That's the billion-dollar question. This question is important for Twitter, as well as its users and global advertisers.
With traditional advertising proving less effective, marketers need new outlets like Twitter and Facebook to help create interest and demand. Here are some ways Twitter can make money.
1. Answer a Person's Product Need
We all search in Google, Yahoo, and MSN because we're looking for something. How do the search engines make money? When people search for products and services.
A similar revenue stream could be Twitter's. Simply ask a question, such as, "Where can I buy the foam things for my iPod headphones?" If a user tweets this, they could get answers from their "followers" -- in other words, real people. Or, if they opted in, they would receive information direct from foam ear bud cover suppliers.
Now, the key for this to work, just like in search, is the relevancy. A good first step would be a simple "thumbs up" or "thumbs down" relevancy button for the supplier tweets. This puts the onus not to spam back on the advertiser, similar to Google's quality score.
You can see why Google is possibly interested in acquiring Twitter, and also why Google launched Google Suggest, which allows users to rate search results and comment on them. Google understands that social media is their most daunting of competition.
2. Be a Recruiting Tool for Job Seekers/Recruiters
Just like Craigslist, Twitter could have employers pay a small fee to easily tweet their jobs. The user would select which titles and occupations they want to receive tweets for.
3. White Label Twitter Functionality for Fortune 500 Companies
Fortune 500 companies don't understand the Web, but think they do. These companies believe they need micro-blog functionality to keep up with the "Web 2.0 times." Don't believe big companies do this? American Airlines and Lufthansa unsuccessfully tried to build their own social networks.
Or going back to the '90s, remember when every company wanted to build out their own portal? AT&T thought everyone would make their My AT&T page instead of MyYahoo. A company called MyWay (part of Diller's IAC) made some serious bucks off these portal wannabes.
4. Analytics Packages for Companies
Break down the conversations occurring within Twitter into digestible data. The categories can be as simple as: Bad Review, Good Review, Product Question, Top Complaints, etc. The challenge here is that a third party may come along and offer this service for free (e.g., Google Analytics).
5. Local Coupon Pushes
This is probably the most obvious. Someone can simply ask for restaurant specials nearby and be pushed digital coupons.
Due to these tough financial times, visits to coupon related sites were up 33 percent, according to comScore. Cellfire ran a test with retail grocery client Kroger and saw mobile coupon redemption as high as 20 percent.
The time is right for this on Twitter. Other researcher indicated that 16 percent of all buyers wouldn't make a purchase these days with some form of coupon or incentive.
6. Micro-payments for Answers to Questions
Willing to pay 75 cents for the best answer to: "Trying to register my Mac & iTunes so I can rent a movie, but I can't figure out where to do this on the iTunes Menu - please help!"? Some people certainly are.
7. Analytics Packages for Individuals, Small Business
Just as it's helpful for big businesses, it would be useful for journalists, reporters, authors, etc., to be able to easily get a sense of what the public likes and dislikes about their work.
8. Quickly Find Sources for Reporters/Bloggers
Writers on a deadline can pay a subscription to easily be connected to the proper professionals to answer questions germane to their story or post. Professionals would register with the service to make themselves available for the free publicity.
9. Capture Revenue from Wireless Carriers
It's in the carriers' best interest to have many text messages flying across their networks. The wireless carriers (Verizon, AT&T, T-Mobile, etc.) could offer a $5 all-you-can-tweet (has a nice ring to it, no pun intended) monthly package.
10. Premium Service
If you launch a version with paid advertising, then you can launch a premium service that scrubs all the ads -- say $4 per month for an advertising-free Twitter.
Item 10 may be counter-intuitive. The key (and challenge) to all of these ideas: they need to be incorporated into the Twitter experience and enhance it rather than being interruptive detriments. If this isn't done properly, then competitors like Tumblr, Publr, Yammer, Six Apart (Pownce), Pluck, etc. could capitalize on any missteps.
Erik Qualman is off this week. Today's column ran earlier on Search Engine Watch.
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Biography
Erik Qualman is the Global Vice President of Online Marketing for EF Education, headquartered in Lucerne, Switzerland. With more than 26,000 employees in 53 countries, EF Education is the world's largest private educator.
His book "Socialnomics: How Social Media has changed the way we live and do business" was released from Wiley Publishing in August 2009. Qualman is a frequently requested speaker within the Internet and marketing community and also maintains a social media blog at www.socialnomics.net.
Qualman has been highlighted in numerous publications, including: BusinessWeek, AdvertisingAge, USA Today, Forbes, PR Week, Investor's Business Daily, eWeek, Media Life, Direct Marketing News and Direct Response Magazine. He has also been interviewed on various radio and television outlets. Qualman is also a published fiction author.
Prior to joining EF Education, Qualman helped grow the online marketing and eBusiness functions of Cadillac & Pontiac (1994-97), AT&T (1998-2000), Yahoo (2000-03), EarthLink (2003-05) and Travelzoo (2005-08). Qualman holds a BA from Michigan State University and an MBA from The University of Texas at Austin. He was also first team Academic All-Big Ten in basketball at Michigan State and still finds time to follow his beloved Spartans.
Article Archives by Erik Qualman:
10 Ways Twitter Can Make Money - December 28, 2009
Is Social Media Privacy an Oxymoron? - December 14, 2009
Social Media FAQs - November 30, 2009
Social Media Success Stories - November 16, 2009
Banning Social Media Is Counterproductive - November 2, 2009
Four Steps to Social Media Marketing Success - October 19, 2009
» More Articles by Erik Qualman
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