What Happens if Twitter Starts Collecting More User Data?

As it is, Twitter isn’t so much a social network as an informational network: your profile is limited, your interactions are more often than not with people you don’t actually know, and you are more likely to share news stories than last-night-I-got-so-wasted stories. But now that Twitter has all guns firing on its advertising platform, will we see more requests for personal information to better target ads and appease advertisers?

Willis Wee at Penn Olson wrote an interesting piece about this very question this week. He puts Twitter and Google on the same side of the advertising fence, displaying ads based on user queries which represent their interests. Facebook, on the other hand, targets ads towards demographic information provided by the user, such as their age, gender and social graph.

Wee posits an interesting question in his article: should Twitter collect more user data? He notes that by basing ad placement purely on search results (which is Google’s forte, not Twitter’s), advertisers might not be getting their Promoted Tweets in front of the right eyeballs.

The article seems to favor more user information being used for Twitter ads. Wee says that users are increasingly willing to share personal information, such as their location, on Twitter – showing a huge jump from 44% to 73% sharing location in the past year alone. He notes that people are not sharing this information for Twitter’s benefit, but that it could be harnessed for more targeted advertising.

However, there are some serious ramifications of Twitter asking for more user information.

Privacy is a major concern for internet users, especially in light of the recent password thefts at Gawker or the exposure of MasterCard numbers by WikiLeaks hacktivists. The more information that is out there, the more easily it can be accessed by others.

Users may feel betrayed if Twitter -which prides itself on simplicity and brevity – began asking them to create pages and pages of their “likes”, “favorites” or “interests”. That would not only raise the hackles of the privacy conscious, but it would also turn off Twitter users who are into the service for its simplicity.

If Twitter started collecting more user data, it might alienate its core usergroup. And as we recently reported, 2.2% of all Twitter users account for 60% of all activity. If this group feels that Twitter is asking for too much information, they might go silent, causing Twitter to lose the majority of its activity.

It’s a fine line to walk between users and advertisers, and Twitter has typically fallen on the side of the user more often than not. Without a source of revenue for over three years of its operation, Twitter chose instead to focus on the user experience.

I can’t really see the company throwing out years’ of catering to the user and creating a minimalist information network as opposed to a social network in favor of making money – but the recent appointment of Dick Costolo to CEO might mean that the company is taking a new, more financially-driven, direction.

In either case, if Twitter does start collecting more user data, they will no doubt appease their advertisers. But the risk of losing core users who have come to embrace Twitter’s minimalism might be too great, and might ultimately hurt both Twitter and the advertisers such a move would initially benefit.