Friday 24 November 2017

Just how does Twitter make all of its money?

They say talk is cheap, but somebody has to pay and it could be you, says Adrian Weckler

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Adrian Weckler

Adrian Weckler

IN the Irish careers section of Twitter's corporate website, there are 28 positions open for the company's Dublin office. But these are not engineering, innovation or technical jobs. They involve sales.

Ahead of an expected IPO next year, Twitter now means business.

The world may have become used to sounding off for free on the micro-blogging service. But the company now wants something back. And its Dublin sales-hiring spree is just one indicator of its serious intent for a push into the advertising market.

Twitter has recently stepped up this commercial drive with the appointment of a new head of commerce, the former president of Ticketmaster, Nathan Hubbard. Mr Hubbard's role will involve a plan by Twitter to create new shopping opportunities on the site, going into competition with Amazon and eBay.

"We're going to go to people who have stuff to sell and help them use Twitter to sell it more effectively," Mr Hubbard said in an interview with Bloomberg News.

"One of the hallmarks of Twitter's entire approach has been partnering. We're going to take the same approach with owners of physical and digital goods."

At present, Twitter attracts revenue largely through advertising on its service. This takes the form of 'promoted' content (see panel, below) which allows companies to purchase positions on the service's information stream according to user searches or keywords.

The format is popular with large Irish-based companies, including telecoms firms UPC, Vodafone and Meteor.

Promoted tweets have also become a method for middle-class malcontents. On Monday, a disgruntled British Airways passenger made headlines when he purchased a promoted tweet to complain about the airline's mishandling of his luggage.

The passenger, Hasan Syed, bought the following phrase: "Don't fly @BritishAirways. Their customer service is horrendous." Mr Syed then vowed to keep buying promoted tweets until his difficulty was resolved.

The airline quickly acknowledged its fault with Mr Syed and has apologised to him. Mr Syed has not said how much the promoted tweet, which received 25,000 impressions in its first six hours, cost him. However, the incident prompted the vice president of rival airline JetBlue Airways to speculate about the introduction of a new type of advertising, where brands purchase tweets to criticise their competition.

Although Twitter does not release detailed accounts – it is still a private company – the online analyst firm eMarketer estimates its revenue to be heading toward €500m this year, with projected growth of up to €800m in 2014.

Other forms of commercial gathering being explored by the company include new ventures in television analytics.

Twitter recently signed an agreement with the television metrics firm Nielsen to create new indices for measuring television engagement.

One reason that the company has recently begun to ramp up its revenue-gathering activity is the expectation of an initial public offering (IPO) on a US stock exchange early next year.

Analysts say that the success of this flotation will depend on established revenue streams and opportunities for growth.

In Ireland, Twitter has over one million registered users, according to recent research published by Ipsos MRBI.

The company currently employs around 100 people in its Dublin premises, but is growing this number rapidly.

Irish Independent

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