is advertising on twitter right for your business?

wieden + kennedy's London office employee Neil Christie wrote on their "Welcome to Optimism" blog about how Twitter has incorporated advertising into its platform. Christie argues why it may or may not be a good idea for businesses to advertise on Twitter.

Twitter just announced that they will be launching a new ad platform and you may be wondering if it’s right for your business. Before we get to that, first let’s talk about how the new model works.

First and foremost, Twitter’s system isn’t all that different from Google AdWords, which is a system for placing ads alongside search results based on the keywords the searcher used. Twitter advertisers place CPL (cost-per-thousand views) bids on keywords and their tweets are displayed in the search results based on their bid and quality score, which will likely be calculated based on how people respond to the tweet, i.e. retweets, @replies generated by the tweet and new followers. The higher your quality score, the lower your CPM.

The benefit to advertisers according to Twitter is your tweets will be displayed “above the noise” of ever-changing search results, which gives brands the power to respond to discussions in real-time and not be buried by rapidly changing Twitter search results. Eventually, promoted tweets will find their way into Twitter streams and desktop/mobile Twitter clients like TweetDeck and Tweetie, but Twitter has not yet announced how this will be executed, but it will likely be related to the topics users tweet about. The ads will initially look like this:

Now, are sponsored tweets right for your business? If you have something to say that’s relevant in real-time, then yes. If you want to use it to promote a static message the same way you would with Google AdWords or banners, sponsored tweets are probably not right for you.

The Starbucks example above is a great illustration of an effective use of this technology. It’s related to a one-day promotion and would be shown to users expressing interest in the brand. It would also make sense for them to use more general keywords relating to coffee. However, keywords relating to free stuff and deals would attract less qualified users.

Initally, this system is being tested by Starbucks, Virgin America and Bravo, however, it will soon be opened up to other brands.