Just like J. Lo said, love don’t cost a thing. While the world has shown the love for Twitter, and it hasn’t cost a thing, the day of revenue reckoning is upon it. Twitter executives say that it will soon offer paid-for “commercial” accounts to give businesses additional features unavailable to casual Tweeters.
This will not set up a toll gate for the six million people currently using the site. Nor will it stop small businesses from having a Tweeter handle. But it does give some clues as to how Tweeter will be used as a marketing platform and how it will make money. There’s a lot to like about this strategy. Among them:
It’s adless: At least for now, Twitter doesn’t have to peg its business model completely on advertising. It could still consider some kind of paid membership levels, and the current interface certainly leaves a lot of room for targeted display ads. But when a company growing this fast can base part of its revenue from users, that is more sustainable than an ad-based model.
It’s competitive: When the Twitterwannabes start flocking into VC money and coming into beta, Twitter has already taken money off the table. It is a built-in customer retention strategy.
It’s viral: If a company is paying money for a Twitter account it will work harder to make it pay out. It will make sure it is followed externally and internally. It will develop marketing strategies for the platform. Just as search grew because companies wanted to be searched for, Twitter will grow because companies want to be Tweeted.
It’s trackable: Company specific Tweeter accounts gather valuable customers and put them in a nice little sandbox. They’re easy to watch. These customers will purchase and recommend. It’s why they use Twitter in the first place. Loyalty programs become easier to execute; promotional tracking becomes easier to execute.
Will companies pony up for the Twitter services? There’s no reason to think they won’t and there’s also no reason Facebook won’t be next with this strategy.