On February 5th, Twitter released their quarterly report—their first as a public company–to an eager crowd of investors, techies, and analysts. Ever since the company started, people have asked how the hell they planned to make money. In large part, Twitter wants to monetize itself by becoming the world’s chat room.
The question is how much potential that global chat room has to be profitable. A series of recent partnerships by Twitter give us a pretty good idea of what’s eventually planned for finance, retail, and marketing. Two ways Twitter can potentially create revenue: by being an online advertising platform, and by offering its data stream as a hybrid mega-focus group/intelligence source.
As an intelligence source, Twitter has recently signed agreements that let journalists mine Twitter for story leads in real time and let A&R reps mine Twitter to determine which unknown bands are becoming popular (on top of similar partnerships in the financial sector aimed primarily at hedge funds).
At the same time, a newish soft feature Twitter is testing notifies users when their friends tweet about television shows. The experimental Tailored Audience program lets advertisers aim promoted tweets at users who have viewed a page about that topic elsewhere on the web. Not to mention Twitter’s existing partnerships with NASCAR, the NFL, and others.
But then there’s Amplify. Amplify is Twitter’s name for a multi-screen advertising product they’re pitching to content producers like A&E, Clear Channel, and the NBA. Fast Company‘s own Ellen McGirt and Nicole LaPorte describe it as a product “which lets content creators send short video clips (along with an ad) not only to people currently live-tweeting a show but also to anyone it thinks might want to tune in”. The Amplify product is an ingenious way for Twitter to turn their mobile app and homepage into the platform on which fans comment on sports matches, award shows, and television programs in real time. And, of course, once fans are second screening through Twitter’s home page, Twitter’s partners can step in to offer targeted (and hopefully lucrative) advertising.
The demonstration of Twitter Amplify below, created by BTIG Research, gives a pretty good overview of how the product works:
Alongside Amplify, Twitter has also been promoting their television advertising dashboard for advertisers, which allows them to individually target TV-watching Twitter users with ads. Both projects tap into an entertainment industry goal which has been coming to fruition at exactly the same time that Twitter itself jumped from geek to mainstream: How to microtarget individuals with television commercials.
