Twitter Launches its First Advertising Platform

It’s official: social media network Twitter is launching its first means of advertising today – Tuesday, April 13, 2010. Many have been speculating since Twitter was introduced four years ago how the social media site intends on making money through advertising. The highly anticipated Twitter advertising platform officially called Promoted Tweets will show up when users search for key words that advertisers pay for. Companies like Best Buy, Virgin America, Starbucks and Bravo have already signed up to run ads on the new Twitter ad platform.

The idea is for users to search for example “coffee” and Starbucks’ Promoted Tweets will appear at the top of the search results page (even if it’s an older tweet), along with small text indicating that it is sponsored. This allows Promoted Tweets to have more influence, especially when it comes to combating negative conversations. Twitter search marketing is effective because companies can post positive tweets to show up on the top of the page, rising above the white noise.

However, Promoted Tweets are not guaranteed to stay up for long. Twitter is judging them based on guidelines they call “resonance”, taking account factors including number of people who saw the post, number of people who replied to it or passed on to others, and the number of people who clicked on the links. If a Promoted Tweet is no longer deemed useful, it will go down.

Twitter founders Evan Williams and Biz Stone have said their plan was to build a service that many people will use and then figure out a way to make money – just as Google did in its inception. Now that Twitter has identified its first step towards a business model, the big challenge will be for Twitter to keep ad quality and relevance high while still making money.

Twitter’s Chief Operating Officer Dick Costolo says, “A lot of people use Twitter for search…the volume is huge. We wanted to do something that just enhances the conversation that companies are already having with their customers on Twitter,”

Unlike search ads on Google, Bing or Yahoo, Twitter ad words will only display one advertisement at a time. Later on, Twitter plans to slowly roll out Promoted Tweets beyond search and into users’ Twitter feeds based on how relevant they might be to each particular user. The reasoning for this is to let users adjust to the changes and not get turned off by over-advertising. Twitter intends to use the new ad platform to engage users by providing features that only improve the user experience.

See the full article in New York Times.