Yet to turn into a profit making company, Twitter is under pressure to show its young advertising business is deserving of its current market cap of $26.9 billion. Hoping to win the confidence of the advertising business which is inclined towards Facebook, Twitter is said to debut 15 types of new ad products and improved ways to target users in the coming six months. Twitter is yet to confirm about the ad experiments in public.
The first batch of the ads that would be rolled out in the coming week, will include a product that will coax users to download apps through Twitter. Hoping to win the confidence of the mobile game developing companies, Twitter will launch a mobile-app install ad unit.
App-install ad unit will be delivered using Twitter’s “card” technology, an expandable tweet allowing advertisers to include a button that lets users perform the desired action. When users click a “download” button, they are taken to the respective app store where they can download the app. Once it starts downloading, the user is automatically taken back to the Twitter app.
This format brings Twitter more in line with app-install ads on Facebook. Facebook users downloaded 245 million mobile apps after seeing ads for those apps in their news feeds last year. This strategy has fuelled Facebook’s mobile advertising revenue, which in the last quarter accounted for more than a half of the overall revenue for the first time.
Subsequently, Twitter wants to take the eCommerce market in confidence too. It is experimenting with placing a “call-to-click” button that would put users on the phone with businesses. The company has also been in talks with payments processor Stripe Inc. to allow users to purchase goods directly through Twitter. Including commerce on its platform has been a work in process for some time, as we noticed while sharing the nine recent Twitter experiments.
Twitter Cards, which is currently limited to seven predetermined formats, executives suggested the product will become a more open platform that would give marketers more creative freedom to come up with their own uses of Cards. Twitter, for example, showed how Cards can be used to encourage users to sign up for sweepstakes and contests with one-click sharing of their email addresses.
Beyond advertising, Twitter has also begun improving methods of targeting users by offering a wealthier trove of data in recent months.
In December, Twitter signed or expanded partnerships with large third-party data marketers such as Datalogix Inc. and Acxiom Corp that allow advertisers to target users based on their consumer behavior when they are not on Twitter. While the two databases can’t make out personal identifiable information such as email addresses and phone numbers, combining the databases can inform advertisers what Twitter users are doing when they are away from the service.
The company’s stock which has fallen about 33% so far this year to $42.96, might get a boost with this new set of advertising features. However with the influx of ads, Twitter will have to focus not only on the user experience but also reduce the customer acquisition costs through its ads.
Right now it is $20 through ads while it is below $4 in the US for new user on Facebook.
It is going to take time while we see a global roll out; the new features could be a respite for Twitter India which recently shared that advertising has been a challenge in the country. With the eCommerce market reported to become $8 billion industry in India, Twitter India would like to grab a bigger piece of the pie to spike its revenues.