Inside Word: In Defense Of Ads In Twitter

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Inside Word
Inside Word: In Defense Of Ads In Twitter

The Inside Word is a weekly feature that looks at compelling industry debates and discussions unfolding on the blogs of employees at digital-media companies.

Blogger: Mark Suster

Position: Partner, GRP Partners

Blog name: Both Sides Of The Table, which features startup advice

Backstory: No one knows what percentage of Tweeters (if any) would drop the service if ads started showing up in their streams, but Suster’s firm invested $500,000 last month in Ad.ly, an in-stream Twitter ad company. Ad.ly pays users, mostly celebrities, who agree to send one Tweet from an advertiser every other day for seven days to their followers.

Blog post: Suster defends the investment in a recent post, arguing that users will accept in-stream ads. “We’ve run enough campaigns to know that users have been tolerant of authentic ads,” he says. “I remember in the mid-90’s when banner advertising started. The first ads I remember were on HotWired. Users were outraged. ‘The Internet is free, you can’t make money off it! It’s for all of us. It’s not TV.’ Do you notice anybody complaining about banner ads these days other than from advertisers complaining that they’re not effective?”

He goes on to say that Ad.ly’s in-stream ads have had high click-through rates because it’s an intent-based form of advertising. “I have chosen who to follow on Twitter so the information in my stream is self selected.”

Post-script: I asked Suster what the market would look like in a year. He said there would soon be a “proliferation” of Twitter ad platforms. As for Twitter itself, Suster said he didn’t believe that advertising would be the company’s focus for the next year-and-a-half—something Twitter executives themselves have said. “If they do enter the market I would imagine it would be through an acquisition of somebody who has proven execution in the market. This is consistent with how Google (NSDQ: GOOG) and Yahoo (NSDQ: YHOO) entered the market for PPC (pay-per-click) advertising, with the purchase of Applied Semantics and Overture respectively.”

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Joseph Tartakoff

@josephtartakoff Nov 6, 2009 6:10 PM ET

Posted In: Advertising, Features, Inside Word, Social Media, Nanopublishing, Companies, Twitter

latest headlines

@PayPerTweeting Info

I also support 'Pay Per Tweet' as a means to support my twittering time. The internet will continue to be free as long as these anti-advertising knuckleheads realize that advertising revenue makes it all possible. Does google provide a search engine because they are simply nice people?

Maija Haavisto

I don't mind people posting very occasional ads, but I've had to unfollow a few people when they stopped posting actual content and only posted ads.

I'm also extremely unlikely to click on a Twitter ad.

Gavin

Everyone…. I mean everyone hates ads with a passion. Especially the new ones that decide to scream through your computer speakers. I will stop using Twitter if I start seeing ads. You guys ruin all kinds of things. I hate you.

patricia

I disagree with this. There are two main applications over any platform—utility, and information distribution. Twitter is a utility—it enables people to talk to other people. It's historically been difficult to insert advertisement into this stream—that's why it doesn't happen with your cell phone or landline. It's just not natural to the experience. Users on the internet are way more tolerant of advertisement and commerical promotion on message boards (which are essentially social networks) but it's not likely that they'll go beyond a certain threshold for it even now.

This is why utilities over a platform make money off services—for telco, that's your voice mail, call waiting, etc. Message boards (aka social networks) have been historically hard to monetize with ad revenue for decades for this reason. You don't hear a lot about it because those who speak and lead in the market take no historical reference or research of the past to point to what to do now.

At some point, everybody will come to this understanding and stop wasting time on the wrong approach.

Rachel

I currently delete every follower who I believe is only trying to sell me something. I go on twitter to socialize and nothing else. Some of the athletes on twitter do a little self promoting or for there endorsements every now and then and that doesn't bother me so much as long as that is not there main focus for being on here to me.