The idea of making money does not always sit well within the dogma of social media marketing, but businesses are increasingly tapping into social media to reach out to customers, build relationships, market more effectively and ultimately seek a return on their social media investment. Looking at Twitter specifically, there are now plenty of examples of companies using the tweetscape as an extension of their business model. Here are eight of the most interesting approaches to money-making on Twitter.
1. Advertising in Tweets
The placement of advertising in Tweets is the low-brainer approach to making money. And according to vendors, such ad networks are already flooded. These include:
Another variant in this category are sponsored tweets, where a company pays a Twitterer for tweets to further its own marketing strategy. The terms of such programs are reminiscent of other compensation models in the online marketing sector. That is, compensation is so low that hardly anyone participating in the program reaches the payout threshold. Check out adf.ly’s payout rates for an idea of what’s on offer.
2. Bargain basement Twitter marketing
The mother of all suppliers in this category is Dell Outlet. Dell uses this Twitter page to sell „Refurbished Dell™ computers, electronics … at great prices,“ and had racked up sales of 6.5 million dollars by December 2009 this way in just a few years. Moreover, one should not underestimate the impact of such a Twitter page as an additional marketing channel. As of today (29 June 2010), an incredible 1,559,891 bargain hunters are following @DellOutlet.
3. Special offers on Twitter
A close relative of the bargain basement is the good old-fashioned special offer. These are typically ‚last-minute‘ deals, with airlines being among the organisations taking advantage of Twitter to offload unsold seats. For example, United Airlines @unitedairlines does a raring trade with its airfare tweets, or ‚Twares‘ as the airline calls them:
With over 88,000 followers, the benefits of this model are clear: United has a ready market of bargain shoppers eager to snap up last minute deals. They have to be quick though; the above Tware was only on offer for two hours.
4. Upselling by tweet
The classic distribution model for digitally distributable goods in particular: offer a free, stripped down version or one heavily leavened with advertising to build the user base, then cash in on the percentage of users who upgrade to the paid version. A good example is the Freemium model of @tweetie or a service such as tweetreach.com, which offers a detailed report on the viral spread of key terms on Twitter.
5. Coupon tweets
A close relative of upselling are coupons. And there are now other services enabling you to use Twitter to aggregate, find, promote or market the coupons. These include, for example, Coupon Tweet and CheapTweet. The latter is particularly interesting because it is a sort of Twitter-based Digg-coupon, which directly ties in with targeted Sponsored Tweets:
These services do not actively distribute coupons, but they use appropriate content on Twitter to create a shopping search engine of sorts, which can be monetised through advertising and affiliate commissions.
6. Transaction-based models
You can use Twitter as a payment platform. Suppliers include twitpay and twippr which use either Amazon Payments or PayPal as a technical basis for billing, then charge a commission on the transaction. This amounts to $ 0.05 per dollar for every transaction at twitpay (which is suitable for micro payments), or four percent at twippr. Also of interest is a new project from twitpay called RT2buy, a sort of Twitter-based iTunes for offering your own digital content. More details from @BenParr on Mashable.
7. Paid content on Twitter
With Super Chirp, Twitter’s first marketer of exclusive direct messages has emerged.
Twitter is mobile and available in real time – and thus an ideal medium for fans of celebrities, bands or sports clubs. It could also be well suited for non-profit organisations, which can use it as an alternative to traditional donations – think of it as a digital, high-end Big Issue.
The author can define the monthly subscription fee for Direct Messages (DM) (0.99 to 9.99 U.S. dollars) and Super Chirp takes a commission of 30 percent.
8. Tinker with Twitter
The idea is simple: aggregate Tweets from third parties on a specific topic such as Harry Potter – thanks to the Twitter API, this is technically a doddle – and enrich it with other content, but mainly with advertising:
Tinker is a development of Glam Media Labs. Using it one can monetise real-time trends or events through advertising, supplementing Tinker.com with widgets on any other page. Interestingly, this does not appear to conflict with the Twitter Terms of Service: „We claim no intellectual property rights over the material you provide to the Twitter service. Your profile and materials uploaded remain yours. You can remove your profile at any time by deleting your account. This will also remove any text and images you have stored in the system.“
As a Twitter trends discovery engine, Twinker takes some beating. See TechCrunch Europe for more background on Twinker.
Will we see more payment models in future? Certainly, for although the monetisation of Twitter is still in its infancy, Twitter-based start-ups get increasingly more funding. By mid-June 2009 at least U.S. $ 23.3 million had already been invested by various angels and VCs – this gives us some hope for the future of getting paid on Twitter.
ps. Of course, this list is not exhaustive. Please share and discuss in the comments any other models you have discovered.
About author Stefan Wolpers:
Stefan Wolpers is an entrepreneur and consultant specialising in startups and social media. He is also wildly enthusiastic about ice cream, which he makes himself and publishes recipes for, and is a self-described lover of Mac, iPhone and Twitter.
Stefan is also the founder of Twittwoch – a Tweetup for people who deal professionally in Germany with social media in general and Twitter and microblogging in particular.