Like every social networking website Twitter also makes money from its users. It has been around 8 years and this little blue bird social networking website has approximately 284 million monthly active users. Launched in 2008, Twitter is now the seventh most popular website and is available in 35 languages and more than 77% of the site’s users live outside of the United States.
No one could have envisioned talking in billions when Twitter was launched by Jack Dorsey, Evan Williams, Biz Stone and Noah Glass. Like Facebook, Twitter has a massive user base but unlike Facebook, Twitter has become a crucial source of news. It is so highly acclaimed and valued as a source of news that its worth is around five times more than the New York.
The US federal Government is investing in big data analytics for Twitter, in a hope to crack down on hate crimes. The government has a hope that insights from Twitter will help identify regions that tend to have higher instances of hate speech. It is from here that the authorities would be able to focus their efforts on improving awareness and outreach programs to solve the quagmire.
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Let us now see how Twitter makes money :
1. Twitter makes Money from Advertisment
Around 85% revenue of Twitter comes from advertisement. In order to earn from advertising, Twitter uses promoted tweets, promoted accounts and promoted trends
Twitter provides opportunities for people to connect and engage with their customers through personal interactions. Promoted Tweets help simplify the tweets to a wider audience to dive more engagement with the content. Tweeter sells promoted tweets to marketers and these tweets then appear in users’ twitter feeds. Starbucks, Virgin America and Red Bull pay for promoted tweets which can appear in Twitter Search results.
Promoted accounts are the ones that are paid by the advertisers that Twitter places in targeted users’ “Who to follow” list. It provides a way for the advertisers to grow a community of users who are interested in advertisers’ business or products or services. Such accounts are pay for performance advertising that is priced through an auction.
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Promoted trends are the ones that are promoted by different companies, organization or people just to make that topic popular in from of users. It was one of the company’s first attempts at using an area outside of the Timeline to drive revenue. When users click on a Promoted Trend, search results for that trend are shown in a timeline and a Promoted Tweets created by advertisers are displayed to the users. Twitter sells Promoted trends on a fixed fee per day basis.
For better understanding for promoted trends have a look over the image in right side.
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2. Twitter makes Money from Data Licensing
In 2015, Twitter announced that anyone who wants access to the stream, known as the fire hose will have to license the data from Twitter directly. Data licensing allows the data partners of Twitter to access, search and analyze historical and real-time data on its platform. These data partners purchase the licenses to have access to all or a portion of the data for a fixed period. In 2013, Twitter got $70 million in data licensing payments, up 48% from the year before.