Twitter has taken its time building a revenue plan, but now the company is ready to move forward with it in a big way. A leaked document reveals that Twitter expects to earn $100 million in advertising revenue from its Promoted Tweets, Accounts and Trends in 2011, and it assures potential Promoted Products customers that Twitter users will get used to the increasingly intrusive ads in their timelines.
All Things D’s Peter Kafka got his hands on a 40 minute tutorial that was meant for Twitter personnel and advertising clients only. It outlines Twitter’s plan for the next year, including just how it will meet the $100 million mark.
Surprisingly to those of us watching the space, the tutorial explains that Promoted Tweets aren’t as profitable as Promoted Accounts. The paid Tweets appear in users’ search results when searching for a keyword that the advertiser had purchased, similar to Google Ads. Promoted Accounts, however, appear on the users’ right-hand panel on Twitter.com and are shown based on which accounts that user is already following.
The presentation urges advertisers to consider Promoted Accounts as a way to reach more users. It suggests that advertisers spend $4 on Promoted Accounts for every $1 they spend on Promoted Tweets, as Accounts have more inventory and are easier to purchase.
However, Twitter isn’t abandoning Promoted Tweets – instead, it will be rolling them out into users’ regular timelines in the next month or so. This means that Twitter.com users will see Promoted Tweets in their home timeline rather than only in search results or on third-party platforms like HootSuite as it stands currently.
Introducing more ads on Twitter will likely annoy users, but the presentation addresses this issue as well, saying that users will get used to the idea over time, and that those who are most opposed will be the minority.
The presentation also informs potential advertisers that while the click-through rate on Promoted Tweets are about 0.3%, the engagement rate – when a user retweets, favorites, or otherwise engages with a tweet – is much higher, at about 1% – 3%.
You can watch the full 40-minute presentation at All Things D.