Twitter says it will test new ad formats and placements on the platform. On Wednesday, Twitter’s revenue product leader Bruce Falck said Twitter would begin displaying ads on mobile devices within conversation threads after its first, third, and eighth replies. The company hasn’t been able to confirm that the changes are permanent, but said it will experiment with formulas to best determine the most meaningful insertion points and layouts. Twitter also said it would consider displaying ads that would opt in for creators, rather than forcing threads to accept them. In that case, creators will also see some of their advertising revenue, Twitter said.
The company has been struggling to significantly expand its user base. In short, we had to be more creative by maximizing the revenue from existing users. Over the past year or so, we’ve seen a ton of new products such as audio chat rooms, ticket events, creator tools, subscriptions, and virtual chips. Eventually, Twitter fulfilled its commitment to investors, doubling revenue from $ 3.7 billion in 2020 to more than $ 7.5 billion in 2023, turning its user base into 315 million monetizable daily users. I want to expand.
Most of the new products are in the early stages of testing, but Twitter hasn’t runaway yet. For example, according to third-party data, Twitter’s new creator platform, Super Follow, recently launched about $ 6,000 or more live in the US and Canada for the first two weeks ($ 12,400 in September 17 days). ) Is shown to have been generated. Company analysis). No matter which numbers are close to the truth, it’s clear that the demand for creator subscriptions hasn’t increased yet.
Meanwhile, Twitter has not yet offered a new premium product, the Twitter Blue subscription, to the largest markets, including the United States. This product contains features similar to what Twitter has previously provided for the “Edit Tweet” button that users want. “Undo” option to catch typos found quickly.
Starting today, I’ve been experimenting with different things in tweet conversations and testing new ad formats. If you’re participating in this test (global, iOS and Android only), you’ll see your ad after the first, third, or eighth reply below your tweet. pic.twitter.com/kvIGeYt2vp
— Bruce.falck () (@ boo) October 13, 2021
But even with all these new features, Twitter continues to generate most of its revenue through advertising. In July, Twitter generated $ 1.05 billion in advertising revenue quarterly, surpassing Wall Street’s revenue forecast. This is due to the improved effectiveness of advertising, and we have introduced 2,500 new topic categories to improve targeting.
Similarly, Twitter plans to contextually relate ads in conversation to what is being discussed.
“We see great opportunities to build ad offerings that create value and coordinate incentives for creators and advertisers,” Falk said in a shared announcement on Twitter. “When experimenting with this format over the next few months, focus on understanding how it works and how it affects people and conversations around you, at different frequencies. Thoroughly test the layout, contextually relevant ads, various insertion points, etc. Also, scrutinize what you’ve learned to determine if you want it to be permanent. Do this for advertisers. Excited to try, he wanted to find a way to open the door to additional opportunities to reward tweet authors and authors, “he added.
Its last bit refers to the proposed revenue sharing with creators who have content that leads to long threads where ad placement makes sense. When tweets spread by word of mouth on the platform, users often scroll down some screens to read more about their responses. This could allow Twitter to insert more ads not just near the top of the thread, but further down the thread, as currently proposed. However, monetizing such viral tweets can affect Twitter content and culture. Twitter is already a place that tends to reward certain high-performing types of users, such as posting snarks, jokes, angry tweets, and other emotional content. By linking the “viral” of tweets to the revenue of creators, Twitter could move further away from the genuine, thoughtful conversations that the company claims to host.
However, as the ad load on Twitter increases, Twitter may be able to offer another product to those who dislike enough ads to pay for an ad-free experience. Currently, Twitter Blue doesn’t offer ad blocking, but apps often offer a way for users to opt out of ads by paying for them. It’s probably bundled with Twitter Blue or can be purchased separately. (Twitter does not say this is under consideration for clarity. When asked, Twitter said it was “not part” of the plan at this time.)
Users tend to complain when Twitter shows ads near the end of the quarter or year and starts appearing every few tweets on the timeline. A fierce backlash from users to these new ads, or any other negative impact on consumer behavior on the platform, could prompt Twitter to revisit this test.
But given that Twitter needs to grow revenue, it’s likely that this change will happen once you get to the right formulas for layout, placement, and content targeting. Already, Twitter wasn’t able to get its “story” product to work, so it’s possible that a new section for advertising has been delivered to the site. But the story didn’t get enough user recruitment to make the ongoing investment worthwhile.
That’s why Twitter is looking for other ways to monetize through advertising. And showing more ads in more places seems to be the current answer.
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