Last year, Twitter fired back at critics who crucified it for its lack of a viable business model when it introduced a couple of advertising products to the world. The social media company mentioned its ambitions to offer self-serve ads earlier this year, and has finally delivered by recently rolling them out to a few lucky marketers. For brands that have been wanting to advertise on Twitter, yet haven’t due to the limitations of its existing solutions, this particular offering is a long time coming.
The beauty of Twitter’s new self-serve ads is all in the convenience. Before the introduction of this new offering, marketers who wanted to advertise through Promoted Tweets or another one of the company’s advertising products had to do so by going through the lengthy process of filling out paper work and speaking with a company representative over the phone. With the self serve tool, a marketer can simply pay for their ads with a credit card, and customize them via a web-based interface in a similar manner as they would with Facebook or Google AdWords. The convenience factor alone should make advertising on Twitter a more attractive idea.
Twitter initially got the ball rolling by releasing three advertising products last year. These products were Promoted Tweets, Promoted Trends and Promoted Accounts. While Twitter’s ad models were able to attract some major brands, the luxury price tag essentially limited it to brands with luxury budgets. Take Promoted Trends, for example. Back in the summer, several outlets reported that Twitter was charging $120,000 to $125,000 per day to run ads through Promoted Trends. With prices like this, advertising on the microblogging platform was viewed as a cost prohibitive move by the average business.
From the looks of it, the new self-serve ads put Twitter advertising in easy reach of marketers by not only making it more accessible, but more affordable. According to reports, the company is allowing brands to purchase ads through Promoted Tweets and Promoted Accounts on the basis of cost per follower and cost per engagement respectively. Ads with Promoted Tweets are said to cost between $0.75 to $2.50 for each engagement, which in this case could include a click, retweet, favorite or @reply, while the costs for Promoted Accounts are said to range from $2.50 to $4 for each follower. A more economical pricing structure should definitely attract smaller brands who steered clear of Twitter advertising because of the costs.
Another Revenue Stream for Twitter
Twitter currently has roughly 2,400 advertisers. Look for that number to grow substantially if the self-serve initiative receives a positive response. The ability to bypass the conversation with a live company agent and buy spots online at a much more reasonable price will open up another revenue stream funded by the small and medium-sized businesses for whom previously, paid advertising on Twitter was not an option. Some observers are questioning whether the motive behind the new format is justifying its recently estimated $8 billion valuation to investors, but in any event, the move should help the company bring in some much needed revenue.
Twitter’s self-serve ads are currently in the experimental phase and being rolled out to a small group of testers. There has been no word on when the format will officially go live. For now, all we know is that it is supposed to be made available to all advertisers over the coming weeks and months. It could be a while before everyone gets to take advantage, but the mere announcement of a new ad platform has seemed to spark a renewed interest in Twitter marketing.