I was curious as to how Twitter makes money.
While idiots like me believe in the objectivity of social media and takes pleasure in writing to be ‘heard’ how do the people who sustain this illusion make money.,for these are not altruistic gems.
This is how twitter makes it money through you and me.
Twitter also sells data. It will generate about $583 million this year. Twitter is expected to generate a little less than $1 billion in 2014, according to eMarketer.
Most of Twitter’s revenue comes from three types of ads, although it plans to have a more robust advertising offering next year.
The New York Times’ Vindu Goel gives a good rundown of those three money-making ad products:
- Promoted tweets: Advertisers pay to have brief messages show up in users’ stream of Twitter messages. They can use keyword targeting to reach specific users. Advertisers can also use a little bit of demographic targeting, although Twitter doesn’t know as much about its users as Facebook does. Twitter gets paid when users engage with the promoted tweets (when they favorite, comment on, or retweet the ad).
- Promoted trends: Twitter lists which topics are being talked about most on its platform. The trends vary by location, so Twitter’s list of topics in the US might not be the same as the list in England, for example. Advertisers can pay to have a topic of their choice listed too. A promoted trend costs roughly $200,000 for a day of exposure on all US Twitter accounts, the New York Times reports.
- Promoted accounts: If a brand wants more Twitter followers, it can pay to have its account recommended to Twitter users.(Business Insider)
Twitter likes to measure its advertising revenue for every 1,000 timeline views, (for some reason, they call it “advertising revenue per timeline view,” as if they’re counting one at a time, but ignore that for now because it’s confusing). What counts as a view? It’s every timeline “requested when registered users visit Twitter, refresh a timeline or view search results while logged in,” either from your desktop or mobile device. Across the entire world, the company makes $0.80 per thousand views, or $0.0008 each time you look at your feed.
But all views are not worth the same. In the United States, the value is $2.17 per thousand views, or $0.00217 per time you refresh. Elsewhere, it’s $0.30 per thousand, or $0.00030 per refresh. That’s why even though 77 percent of Twitters 215 million monthly users come from outside the U.S., only 25 percent of its revenue comes from advertising to them.
Twitter allows a single “Promoted Trend” to sit above the other nine. According to a source, brands are asked to pay $200,000 a day in the U.S. if they want to feature a trend – usually a hashtag – of their choice.
This digital billboard is in high demand.
Over a six-month period from March to September, Twitter may have raked in as much as $23.8 million with its U.S. promoted trend, selling the digital billboard 119 times in 179 days, based on tracking by CNBC.
Twitter didn’t immediately reply when emailed for comment on the pricing.
So who’s buying?
By CNBC’s count, media companies promoting movies and TV shows were most interested in the ad buy, purchasing 43 promoted trends for a total of $8.6 million during that time.
The technology industry bought 24 trends ($4.8 million), while food and retail companies purchased 31 trends ($6.2 million). Education services, auto companies and the finance industry ordered a combined 17 trending topics for $3.4 million.
It’s worth noting that the money spent here does not include additional purchases on Promoted Accounts and Promoted Tweets, which advertisers also tend to invest in on days it features its trending topic.